Holiday Credit Card Advice – ‘Tis the Season to Use Your Credit Wisely
The holidays can be a dangerous time for credit card users. You’re in a generous mood, you’re at the mall, and the credit card bill seems a long way off. But the reality is that, sooner or later, you’ll have to pay for all of those gifts. Here are some suggestions to help keep you in the holiday spirit while protecting you from excessive credit card bills in the New Year.
It Came Upon a Credit Card
Before you start your holiday spending, review your credit report. You can get a copy from Web sites such as www.experian.com. Verify that all of the information is correct, and that there are no unfamiliar accounts on the report. Your credit report will also remind you just how much money you already owe on each of your credit card accounts. Keep this in mind as you shop for the holidays
“During the holidays, be sure to review your credit card bills closely as well,” advises Maxine Sweet, vice president of public education for Experian. “If you notice any unusual activity, be sure to notify your credit card company immediately.”
Do You Hear What I Hear?
It’s that little voice inside your head telling you that it’s the holidays, so why worry about the budget? Ignore that voice. During the holidays, more than ever, it pays to plan ahead. Make a list of all the gifts you need to buy, then set a limit for each that is reasonable for your budget and stick to it. When you want to splurge and put something on your credit card, ignoring the fact that it’s something you can’t afford, avoid the temptation. “The rule of thumb is to keep your credit card balances manageable, which means you should be able to pay more than the minimum payment each month and pay the entire balance off in a short period of time,” says Sweet.
Rudolf the Power Shopper
The Internet has made it easier than ever to be a comparison shopper. No matter what you’re looking for, chances are you’ll be able to find numerous Web sites selling the same or similar products, so you can usually find the best deal. During the holidays, many Internet businesses offer perks, like free shipping or gift wrapping, making your holiday shopping even easier. Another alternative to consider is gift cards. Many malls offer cards that are good at any store in the mall, or you can give a gift card that you know will be meaningful to the recipient. For example, if your babysitter loves movies, give a gift card to the local theater or movie rental store. Avid readers will love a bookstore card. Not only does this help keep you on budget, since you won’t be tempted by impulse purchases, the recipient gets to buy something he or she really wants. Making a charitable donation on behalf of your friends or family is another great option. It’s really two gifts in one – the charity gets a much-appreciated donation, and the honoree gets the satisfaction of knowing they’ve made a difference.
We Three Kings are Broke
If you can’t afford to buy gifts for the whole family, why not suggest drawing names this year so everyone only needs to buy one present instead of having to buy for your siblings, their spouses and their kids? Or have the grownups skip gifts altogether and just focus on the children. Consider alternatives to gifts you buy. Offer snow-shoveling services to your grandmother or free babysitting to your sister. Another good option is to gather friends and family together for a holiday party in lieu of gifts. The party doesn’t have to be fancy or expensive. It’s just a way to spend some time in the company of those who mean the most to you at this special time of year.
You’re a Mean One, Mr. Grinch
Sad to say, in addition to being a time of good cheer, the holidays are also prime time for identity theft. Don’t let yourself become a victim of this growing problem. “Make sure to keep track of all your receipts and shred them before disposing of them,” cautions Sweet. “Keep your wallet and purse protected at all times when you’re out shopping. Don’t give out any more personal information than absolutely necessary when making a purchase, and always cover key pads when entering your pin number to prevent someone from capturing the number. This is also known as shoulder surfing.” Consider using only one credit card for holiday purchases. By taking only one card shopping you can reduce your exposure to fraud if your purse or wallet is lost or stolen in the holiday bustle and it can make it easier to track your spending.
For more information on checking your credit report, as well as information to help you understand, manage and protect your personal credit profile, visit www.experian.com.