Featured Posts

Is Tesla Still a Worthy Investment? "Is Tesla still a worthy investment?," asked a friend of mine who read my article which I wrote back in June of last year. A lot has happened since then. Tesla stock has doubled in price and Elon's presence in the media is omnipresent. This guy is one of... Read more

Year 2013: My Favorite Personal Finance Articles It is hard to believe but, indeed, year 2013 is in the box. For stock investors, it was a banner year. Nasdaq finally climbed back to its old highs and other indices performed brilliantly as well. While pundits on the Street may have tried their best to... Read more

That Mutual Fund is Robbing Your Retirement "I don't take risk, so I invest in a mutual fund," said a friend with a smirk. He is not alone. I have known many friends who take pride in handing their hard-earned money to the Wall Street gang. If you are one of the proud mutual fund investors, I am about... Read more

How to Make Money Online Internet has definitely transformed our world. From a street smart's perspective, Internet has ushered a new era of knowledge that was confined in the walls of libraries around the world. It has also made harder for biased journalism to twist facts and control... Read more

How to Invest Money in Any Market [caption id="attachment_4819" align="alignleft" width="640"] photo by: Grant Wickes[/caption] Let's face it, not all investments are made equal. How to invest money is  as much or more important than how to earn and save money. I have known many friends who... Read more

Mr. Money Mustache and Jim Collins: An Interview [caption id="attachment_4746" align="alignleft" width="640"] ....photo by: timmycrockery[/caption] Mr. Money Mustache is the Babe Ruth of the early retirement zealots on the blogosphere. His fiery style with a touch of badassity has inspired thousands around... Read more

Tesla Cars: Why Investing in it May Make You Rich The investor of today does not profit from yesterday's growth. -- Warren Buffett If you are wondering, the title indeed  is dubious. And that's by design. I am not suggesting that buying a Tesla car may make you rich. At the hefty price tag, it can certainly... Read more

Is Apple not Paying its Fair Share of Corporate Taxes? Apple has been in the limelight again, but this time Steve Jobs is not around to vindicate it from tax avoidance allegations: It is accused of not paying its fair share of corporate taxes. Uncle Sam wants sweeter Apple as he is hungry. Common sense is uncommon... Read more

Life's Like a Football Game The biggest diverse, invasive or pervasive culture that human kinds knows is football and I love the fact that at the altar of football human kind can come worship and celebrate. -- Former Newcastle player Andy Harper Football is an amazing game. The thrill... Read more

Don't Die Like an Idiot: Create a Living Trust I confess that the title of this post is bit denigrating, but you will like it once you read this article in New York Times. We avoid thinking about our death and our taxes -- both are inevitable! Roman Blum, a holocaust survivor, left $40,000,000 estate... Read more

How to Build Wealth: A Do it Yourself Guide Investing is intimidating for most of us mere mortal souls. With so many ways to invest -- and so many products to choose from -- it has become a task as difficult as a task for a kid to decide which candy to buy from a candy store. We often ignore the hidden... Read more

The Fetish of Consumerism It is by the goodness of God that in our country we have those three unspeakably precious things: freedom of speech, freedom of conscience, and the prudence never to practice either. -- Mark Twain The assault on saving,  by our media,  is a common phenomenon.... Read more

Get Free Articles!

Proud Member of Yakezie

How to Use Your Credit Cards Wisely for Holiday Shopping

Category : Personal Finance

This article was written by  Logan Abbott, a personal finance and credit card expert with over 10 years of experience.

The year is winding down, and we are now in the midst of this year’s holiday shopping season. While we are still in the throes of the global economic recession, you and millions of other people will venture out to crowded department stores, malls, and boutiques in search of the perfect gifts for their friends and family.

Since most people know they will be spending money on gifts, the holiday season is one of the best times to take advantage of benefits offered by credit card issuers such as cash back, rewards points, and no interest on purchases. Keep in mind, if you were to make these purchases using cash, you would be squandering the potential benefits gained by using a credit card.

However, the holiday spirit and temptation to buy expensive gifts for friends and family members can end up causing shoppers to rack up significant amounts of credit card debt, simply due to failure to take adequate precautions when using their credit card.
Here is a list of simple questions that you should ask yourself when using a credit card this holiday season to minimize problems and maximize benefits:
  • Am I already carrying credit card debt? If the answer to this question is yes, then you should probably stay away from using your credit card to make holiday purchases this year. While it’s easy to get carried away with wanting to make your friends and family happy with nice gifts, your financial security is more important, so scale down those gift purchases to something more affordable.
  • Do I know my credit limit?  Knowing your credit limit is of utmost importance. This is because if you exceed your credit limit without knowing, you run a good chance of the credit card company charging you penalty fees, and harming your credit score. Do not spend more than your credit limit allows for.
  • Do I know my interest rate on purchases? If you plan on carrying a balance whatsoever, you’d better know your interest rate, or you risk digging yourself into debt. If you have a high interest rate and you’re planning to use your credit card for holiday purchases, you should make sure to pay the balance off in full at the end of the month.
  • Do I have a budget in mind? The easiest way to stay within your means this holiday shopping season is to create a list of gifts that you plan on buying for your friends and family including dollar amounts, and then adhere to that budget by all means.
  • Can I use my existing credit card points to buy gifts? One of the main draws of a credit card is getting rewards points from your purchases that you can redeem later for items such as electronics, flights, hotel stays, and more. If you have a lot of points saved up from using your credit card throughout the year, you can use these points to buy gifts instead of having to use actual money. This can save you a lot. If you do not yet have a credit card that offers rewards points, you can compare credit cards  to find one that will benefit you the most.
  • What do I say when a store offers me a store-branded credit card? No. That’s a simple answer. You want to make sure you stay away from retailer credit cards at all times. This is because their interest rates are extremely high, and they offer poor long-term benefits. In addition, applying up for too many credit cards in a short period of time has the potential to harm your credit score.

With the above questions (and answers) in mind, you are now ready to get out there and shop for your loved ones, while at the same time ensuring your financial security.

Elsewhere:

How to Play the Credit Card Game and Beat the System @ Work Save Live

Credit Card Balance Transfers Can Be Your Friend @ Modest Money

Using a Credit Card to Buy a Car @ Financial Samurai

Photo by: Paymentmax

Related Posts Plugin for WordPress, Blogger...

Comments (5)

I love getting and shopping with reward points. We actually bought most of our Christmas presents this year with them, but I agree that if you carry a credit card balance, you have no business shopping with credit.

Discipline is the key. If you can’t pay off balance at the end of the month, don’t indulge yourself into earning any fringe reward offered by the credit card company. It’s simply not worth it.

Agreed. We bought flights for all of our holiday traveling using rewards points.

[...] @ Street Smart Finance writes How to Use Your Credit Cards Wisely for Holiday Shopping – The year is winding down, and we are now in the midst of this year’s holiday shopping [...]

[...] How to Use Your Credit Cards Wisely for Holiday Shopping on Street Smart Finance [...]

Post a comment