Consumers Beware These 5 Holiday Spending Hangups

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Does the onslaught of holiday decorations around town make your wallet tremble? Keep your seasonal spending on track with these five ways to ensure that your holiday budget stays merry and bright.

Carefully Consider New Credit Offers

The holidays are a time that can easily put good spending habits to the test. Seasonal expenses combined with an attractive new credit card offer might prove tempting, but beware those low introductory rates that will spike next summer. Most states have laws that limit the interest rate lenders can charge on borrowed money – limits that, in theory, apply to credit card issuers. But a 1978 Supreme Court decision, and state laws passed in response to it, have made those limits irrelevant when it comes to credit cards. For all intents and purposes, there isn’t a maximum legal interest rate on credit cards in the United States, so be sure to read the fine print in those card offer leaflets you receive.

Know Where You Stand Before You Shop

If you haven’t been monitoring your finances through the fall months, make sure you check in before you embark on a holiday spending spree. Knowing in advance what shape your finances are in and understanding how much debt you have can help you budget a reasonable amount to spend on the holidays. Consider a detailed budget that shows where you can spend on gifts, décor, and seasonal events you may want to attend. A budget is only good if you stick to it, so check in regularly to keep yourself on-track throughout the season.

Be Frugal with Your Personal Information
Holiday shopping trips may provide opportunities to enter drawings – a free lunch, a neat tech toy, or even some great winter sports equipment – but think twice before volunteering any sensitive information, especially if it involves your credit or financial details.

Shop Savvy Online
If you’re scouring the Internet to compare prices, you may also subscribe to shopping newsletters or apps. Be cautious when supplying your payment information, since many websites collect both your personal and financial information. Make sure you know how they ensure the security of your information before you sign up. There are many ways to harness the power of the Internet to capture a better deal – and they don’t all need your personal information to help you find better prices.

Stay Connected
As the holiday season progresses, make sure you’re auditing your accounts to confirm all the charges are accurate. The same advice goes for those holiday credit offers you may receive: pay attention to the rate your cards are charging and shop around for the best rates when applying for new credit. You’ll also want to check your credit throughout the season – and the year – for any signs of suspicious activity that could be costing you, and address them as quickly as possible. You may also want to consider credit monitoring to help you keep an eye on your credit information during the holidays. With shorter days and more to do, outsourcing monitoring can be an easy way to stay on top of key changes that appear on your credit report.

Still worried about your holiday finances? With a bit of planning and some discipline and ingenuity, you can be the master of a holiday budget that won’t land you on the naughty list.

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.