CREDIT CARDS AT CHRISTMAS

Credit Cards at Christmas

Credit cards are a convenient way to pay for the things you want, and ever so tempting at Christmas time, but this convenience can come at a cost. It can be very easy to rack up more debt on your card than you expect or are comfortable with, so it's important to stay in control.

Here are some things to consider whilst using your credit card at Christmas:

1.    OVERSEAS TRANSACTION FEES

If you do Christmas shopping online with an international retailer, you could end up paying an international transaction fee worth 2–4%.

2.    OFFERS TO INCREASE YOUR LIMIT

Banks sometimes offer you a higher credit limit on your card.  If you receive an offer to do this around this time of year if could be very tempting to take them up on this.  However, getting a higher credit limit can be bad for your Christmas budget, since the temptation to overspend will be magnified. You could easily end up spending more than you should and paying much more in interest charges too.

3.    CONSIDER REDUCING YOUR CREDIT LIMIT

If you want to avoid the temptation to overspend on your card, ask your credit provider to reduce your credit limit. You can do this by phone or by visiting a branch. In most cases, your account will be updated within 1-2 business days.

4.    PAY ON TIME

When you get your credit card statement, check the date the payment is due, and make sure you pay on time. This will help you avoid extra interest charges or hefty late payment fees.

To make it easier to pay on time, consider setting up a direct debit to pay a fixed amount off the balance owing each payday. Just make sure these payments cover at least the minimum monthly payment due on the card.

5.    MAXIMISE YOUR REPAYMENTS

If you only make the minimum repayments on your card each month, you will pay a lot of interest and it could take you a long time to pay off your balance.

Why not make a plan to get rid of your credit card debt and pay more than the minimum repayment each month.

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