As per a recent report, many more American customers are expected to pay for their shopping with cash and debit cards, while fewer consumers are expected to use their credit cards. According to the server, around 27.6% of the shoppers would pay for the gifts with credit cards. This percentage is the lowest since 2002, the year in which 26.8% shoppers used credit cards for their shopping plans of the holiday season. Approximately 43% of consumers are expected to pay for their shopping expenses using debit cards. This represents a 20% increase from the 34.3% mark in 2005. The number of customers who are going to pay for their shopping expenses with cash has increased slightly from 24.9% last year to 25.7%.
A lot of customers actually believe that using credit cards increases their spending for the holiday season. On average, credit card customers end up spending between 100 to 500 dollars more than originally planned. They also admit that they are not prepared for a surge in their spending. You might need a few tips in case you are intending to use your credit card for your holiday expenses.
The first thing to do would be to have a holiday spending work sheet. There are quite a few articles online which show you how to control increasing bills. You must also realize the simple fact that some of the store credit cards have attractive discounts at sign up, but they come with large interest rates. The average interest rate on store credit cards was found to be 23.83 percent, which is 9 points higher than the rate offered by bank credit cards. It is therefore far more sensible to get yourself a low interest credit card if you think you would be making a payment over a period of few months.
It is also a good idea to utilize the holiday cash back reward offers from credit cards that you already own. This could include bonus points, redemption, gift cards for the bonus points etc. It is not a bad idea to check with the credit card issuers for promotions that will help you make a few savings. This way, you wouldn`t be spending more than what you are expected to save. You can also cash out on some rewards points and cash back cards.