The average American spends the first six months of every year paying off their holiday debt from the year before. Overspending, opening new credit accounts and generally just spreading your finances too thin is especially tempting as you succumb to the “spirit” of the holidays.
That spirit has Americans planning to spend an average of $1,096 on holiday presents this year, up $207 from 2004. thecreditrepairblueprint.com/10-credit-card-tips-holidays/ But before you dust off your trusty credit card for its busiest time of the year, read up on these 10 tips that will keep you and your credit scores merry and bright.
1. Stay away from high credit balances and too many accounts.
Charging high amounts to your credit cards and carrying them over month to month can lower your credit score, even if you are making payments. That’s because the high balances could indicate that you may have bit off more than you can chew, financially speaking.
Opening too many new credit or charge accounts can also negatively affect your score — it may indicate that you’re spending more than you can honestly afford.
2. If a creditor inquires about your credit score, it counts against you.
Every time you open a new account, a creditor will check your credit report. This is what’s known as a “hard” inquiry, and it’s figured into the formula for calculating your final credit score. Too many hard inquiries can, indeed, count against you. “Soft” inquiries, however, (such as when you inquire about your own credit report) do not get factored in.
3. Pick a card that fits your needs.
There are all kinds of credit cards out there — those that offer airline, merchandise or travel rewards, those that offer extra warranties or accident insurance for electronics or travel and those that offer low, fixed interest rates. Depending on your needs and lifestyle, you should choose a card that can benefit you the most.
4. Have your name taken off of credit marketing lists.
If you find it tempting (or just annoying) that credit card companies are mailing you marketing materials to get you to sign up for their cards, you can have your name removed from their lists (similar to the National Do Not Call Registry).