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There`s no doubt about it - holiday shopping can be a truly stressful endeavor. Not only are there often crowds and chaos to be encountered at stores, but there is the challenge of finding gifts for everyone on your list while staying within your budget.
Credit cards, when used conservatively and with common sense intact, can be a great asset when it comes to making holiday purchases. They key to using credit cards correctly is by keeping in mind that you aren`t out to create additional debt but to use your credit cards to your fullest advantage in order to collect rewards and cash back points by buying the things you would be spending money on anyway and paying the balance off before it can accrue any interest charges.
Keep in mind that all rewards credit cards work a little bit differently, and careful attention should be paid to the value of the rewards you are earning.
Travel rewards cards can offset some of the hectic aspects of the holiday shopping season as you charge your way towards a relaxing vacation you can cash in on in the New Year once all the celebrating has subsided. Some cards are offering big bonuses to new accountholders if they reach a specific spending minimum within a set time period after opening the line of credit.
Cash back rewards are always great, and it is highly unlikely that they will go unused. Many issuers also offer cashback bonuses for meeting a minimum spending amount within a particular period of time, typically three months, after the account has been opened. Most cashback cards offer unlimited cashback reward percentages (typically between 1 and 2%) on all purchases and bigger percentages back (up to 5%) on specific items or on things that are purchased online though the appropriate shopping portal. All issuers uphold different policies regarding the expiration of rewards.
It’s even possible to obtain reward benefits without opening an entirely new credit card account. Take a moment to call up your bank and ask if your MasterCard or Visa is eligible for some sort of rewards program. Sometimes specific retailers and merchants offer perks like gift cards for making a certain amount of purchases from their website with your credit card. Keep your eyes peeled as you are out shopping for those types of special offers.
Be mindful of any restrictions that limit how and when you are able to redeem the rewards you have earned. And when using rewards credit cards, always make sure that you pay off the balance every billing cycle and don’t allow things to revolve and accrue interest. Most rewards credit cards come with a higher APR than the average rate, making any rewards you earn come at too high a cost if you carry an outstanding balance.