Abby Hayes
The holidays aren't just the hardest time of year to stick to your diet plan. They're also a tough time to stick to a budget. Holiday parties, decorations, baked goods, family activities and, of course, gifts, can all add up to a lot of spending.
And if you don't have much in your piggy bank, it's tempting to charge all those expenses to a shiny plastic card. You can always pay for it later, right?
But you shouldn't necessarily lock away your credit cards until the new year. With a few simple steps, you can use credit cards wisely this holiday season. You may even get more bang for your buck by using credit. Here's how:
1. Think before you swipe.
Yes, you certainly can get rewards for using credit cards to shop for the holidays. And if you haven't saved enough money for gifts, you can spread out your purchases using credit cards. But that doesn't mean you should automatically pull out the cards when you're ready to purchase a gift or new decorations.
Make a habit of thinking twice before you swipe your credit cards. You can even take some simple steps to avoid automatically charging purchases:
-- Don't save your credit card information to websites. A saved credit card is an easy way to check out before you've even mentally processed what you're buying. The act of getting out your credit card and entering the information may save you from unwise purchases.
-- Keep your cards at home. Likewise, don't carry your credit cards with you this holiday season, unless you're on a planned shopping trip. Stores are great at getting you to buy extra junk you don't need with tempting displays and pretty endcaps. If you don't keep your cards with you, you'll be less likely to buy things you weren't planning to buy in the first place.
-- Make a shopping list. Use a site like Pinterest or an Amazon wish list to create your shopping list well ahead of the holidays (like, now!). Before you buy another gift for your mom, your spouse or your kid, check the list. Is the gift you're about to buy something that you planned? Or is it just a last-minute, that-looks-fun purchase? Referencing your list can save you from expensive, underappreciated last-minute purchases.
2. Leverage rewards.
One of the best ways to get more bang for your buck with credit cards is to leverage rewards. Luckily, there are some great apps that can help you do just that.
One option is Wallaby. This app lets you enter your credit card information for all the cards you own. Then, it keeps track of the rewards available for each card -- even the ones with rotating categories. You can even use the app in-store to figure out which card will net you the best rewards for each purchase.
3. Take advantage of holiday rewards.
Many credit card companies roll out extra rewards during the holiday season. For instance, American Express sponsors Small Business Saturday each November. This year's Small Business Saturday is Nov. 29, and American Express cardholders can get a $10 card credit when they spend $10 or more on a single transaction at a qualifying small business. You could do this up to three times for a total of $30 back.
Other credit card companies are catching on to the holiday specials trend. If you're thinking of applying for a new credit card, look at the rewards for the holiday season. You may be surprised by the deals you'll find.
4. Keep a budget.
The reason it's so easy to lose track of credit card spending, for most of us, is that the money is not coming out of our checking account. That balance isn't going down, so we spend more than we think we will.
Don't let your credit card spending get out of control this holiday season. Be sure you keep careful tabs on what you've spent and on what you're still planning to spend. Not great about writing down your transactions? Use an app or website that links your cards to track spending for you. Then, check in with your holiday-related spending every week or two during the holiday season.
5. Shop early, and then wrap it up.
One temptation with holiday shopping is to wait until the very last minute. If you do this, you've probably missed most of the good deals. And in your frenzy, you're likely to spend more money than you intended.
Don't fall into this trap. Instead, set a goal to finish shopping at least two weeks before the holidays. Get all your gifts together and organized, and then wrap them up so you won't be tempted to add little extras later on.
Yes, this is a tall order. But shopping earlier and more thoughtfully keeps your spending under control and makes the holiday season more relaxing and enjoyable for everyone.
Abby Hayes is a freelance blogger and journalist who writes for personal finance blog The Dough Roller and contributes to Dough Roller's weekly newsletter.
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