Christmas on credit

Christmas on credit

In an ideal world, we would all save year round for Christmas and approach the festive season with a nice healthy savings account, all ready for the present shopping to begin.

The reality, however, sees most of us approaching November with a mixture of panic and desperation, particularly given the current period of economic stagnation, high inflation and low wage rises.

The fact is, we’re all strapped for cash and the Christmas period is one of the most expensive of the year. Not only presents, but parties, eating out, new clothes, haircuts, travel and general good times all combine to a rather expensive bill!

One useful solution can be to get a credit card that allows you to spread the cost of the festive season, but without paying through the nose for it.

Avoid basic credit cards with sky high interest rates, or you could find yourself still paying for this year’s Christmas holiday, next year!

A credit card with a zero percent interest rate for an initial period can be useful. Some cards offer this at three months, which may give you enough time to clear the balance before the interest charges kick in.

The trick is to do all your spending on this low or no interest rate card, then repay it as quickly as possible – ideally spreading the cost over the promotional period.

Other cards allow you to transfer expensive prior credit balances for a certain extended period if you have previous debts being charged at high interest rates; there are cards offering zero percent balance transfers for a year or more.

If your finances are in good shape and you’re simply looking to maximise returns on your Christmas shopping, you could also look at a cashback card that gives you between 0.5 and 5% of your purchases back at the end of the year in a cash sum.

Just remember to pay it off each month if full if you don’t want to pay interest charges. You can find a list of these cards at comparison sites such as moneysupermarket.com.

Other cards offer incentives such as airmiles, loyalty scheme points and other rewards, which can make them worthwhile. You can also apply for credit cards through cashback sites. Sometimes, certain providers will run promotions whereby you can earn a cashback amount for applying for a card and using it.

Remember too that a credit card offers useful additional protection when you’re shopping online against fraud, as well as protection against providers who go bankrupt.

Additional protection services can be bought and may be included in card insurance, for items bought on the credit card and later found to be faulty, or lost or stolen. Credit cards offer additional protection compared to debit cards or cash in these instances.

You may wish to take out your own card protection in case you find yourself unable to meet repayments in the event of unemployment or sickness – check details with the provider to find out more.

For all the latest credit card offers and rates, go to a comparison site and do a search. You can even apply directly via the site for speed and your card should be with you in just a few days. Happy shopping!