Stimulus money 'should be used to pay credit card debts'

Now could be an ideal time to take steps to clear their credit card debts, for those Aussies receiving money from the government as a part of its financial stimulus package.

Speaking to A Current Affair, Paul Clitheroe - author of Making Money: The Keys to Financial Success - claims this cash should be put towards repaying debts owed on credit cards, particularly if a significant rate of interest is attached to such a product.

"I strongly encourage you to take your $900 and actually pay down that high interest," he claims, adding that those with credit cards charging interest of between 20 and 30 per cent should not see themselves as "anti-Australian" by wanting to use the money they receive to clear their debts.

Mr Clitheroe also urges those who owe money on multiple credit cards and are at risk of losing their home to recognise the difficulties they are in and be proactive about getting on a firm financial footing.

One way in which people may be able to manage their finances more adeptly is by opting for a zero per cent credit card balance transfer.

Earlier this month, Aaron Summers, from Rockhampton, Queensland, told the Morning Bulletin that he will use his stimulus cash to help pay off his credit card bill, in addition to topping up his wardrobe.