Time to Think About Your Christmas Shopping

It’s that time of year again!  Yep, you heard that right.  It’s time to think about Christmas shopping!  Where will you get the money this year?  Credit cards?  Personal loan?  Maybe a year end bonus?  Or will you use just plain old cash?

You know, retail stores aren’t the only ones who love holiday spending.  Credit card companies stand to make a small fortune every time customers whip out those credit cards… that’s why your mailbox is filling up with all those credit card offers, with balance transfers, low interest, and rewards galore!  And, while there are some really good deals right now, be sure to read the fine print for any new offer that you consider applying for this year.

Here are a few things you’ll want to pay attention to before you fill out that credit card application:

“Interest Free” Purchases:  Seems like every offer you see, whether it’s in the mail or in the store, promises “interest free until next year.”  And while it’s true that you won’t pay interest, you do need to make sure that you can pay off that “interest free” purchase before the expiration date.  Otherwise, retroactive interest charges may be added to your account at the end of the promotional period.  (And while you’re at it, better check what the interest rate actually is when that promotional period expires!)

Balance Transfer Fees:  Be sure to read the fine print any time that you consider a balance transfer – with fees as high as 3%, you could pay a pretty hefty fee if you transfer a large balance.  And again, make sure that you can pay the full amount off before the end of any balance transfer promotion!

Store or Catalog Credit Cards:  Right now, there are lots of promotions out there… discounts, coupons, interest free until next year, etc.  Once again, check your interest rate and have a plan to pay the account off quickly!   (Store and catalog cards are actually a good start if you’re looking to improve your credit score – many of them will work with you to get you the credit you need.)

Millions of Americans use credit cards as a way to finance their holiday spending, and then aren’t able to pay it off – make sure you’re not one of them.  Set a budget, have a plan and enjoy the upcoming holiday season!