As the holiday season approaches and retailers push to make 60+ percent of their annual revenue 4Q 2013 there are a few pitfalls to be aware of. G.I. Joe once said knowing is half the battle. The other half is making good decisions.
1. Know your limits. The optimal usage on revolving lines is no more than 30% of your available balance. Set your budget accordingly and be sure to shop sales if you are using you’re credit cards.
2. Late payments. In the hustle and bustle of the holiday season it is easy to get sidetracked and miss a payment. It is always suggested that you have your credit cards set up on autopay for the minimum payments. This will keep you from missing that minimum while you are traveling, shopping, or just overwhelmed by the season.
3. Store credit cards. Now is the time of year retailers like to push their credit cards on you. You have your basket full of goodies at the checkout counter and a friendly young clerk asks if you would like to save 15% on your purchase by opening a “insert big chain store here” credit card. The answer should always be “NO!” Sure you may save 15% on your one time purchase, but do you want to trade that for a credit score damaging inquiry, new credit line with no history and 19+ percent interest rate?
4. Overdraft fees. Hopefully you are not in the position that holiday shopping stretches your budget, however if you find yourself like most Americans you might be. Keep track of what you are spending. Set a budget and don’t go over it.
5. Protect your cards. With everyone out shopping in crowded malls and stores thieves become more active as well. Opportunity brings scavengers. Keep your credit and debit cards close and your cash even closer. Identity and credit/debit card theft soar during the shopping season. Keep an eye on anyone you have to hand your card over to and be sure to report lost or stolen cards ASAP.
Be safe, stay warm, and keep your credit in mind. If you have concerns you should check your credit reports for any suspicious activity.