Christmas Shopping Need Not Lead To Credit Card Debt

by The Smarter Wallet on October 20, 2010

Now that it’s October, it won’t be long before Christmas will soon be upon us. People are already starting to think about the forthcoming holiday, but for some reason, people are still taken by surprise sometimes, which is why you’ll find the stores tend to get packed with a lot of last-minute shoppers.

There’s no doubt that Christmas tends to be equated with shopping, which is why you’ll find that there are a lot of people thinking about what gifts they can purchase with their credit cards this year. Without self-control and a budget in place, Christmas is indeed a dangerous time for finances.

That is certainly the case for many people, especially those who haven’t got firm budgets or struggle with spending money in some way. Budgeting for holiday shopping is absolutely essential. If you start now, you have a few more paydays to go until Christmas, assuming you get paid at the end of the month and you don’t get your Christmas pay early. If you do, you’ll be in luck as that gives you an extra payday a few days before Christmas. That’s why you have to start thinking about it now.

We know we have time to plan, so although it might go against our nature to do so, it pays to do it now. Even if you like to put off the shopping until the very last minute, there is nothing to stop you from setting aside a portion of your paycheck for Christmas shopping purposes. Once December rolls around, you can use the money you set aside and do your shopping.

Christmas Shopping Need Not Lead To Credit Card Debt

However, not everyone is able to set aside some cash for shopping, making credit cards the main alternative. But is it a good or a bad idea to use your cash back credit cards for Christmas shopping? If you speak to people who dread their January credit card bill, you might think it’s a bad thing. But it doesn’t have to be this way. Without a doubt, credit cards are useful during the Christmas season but you need to control your spending and stick to your list of purchases so you don’t find yourself drowning in debt by the next year.

To avoid racking up huge credit card bills, be sure that you make and stick to a holiday budget for the presents you’re buying. Saying that you’ll just worry about it come January is a surefire way for you to sink into debt. It might not matter in December, but you’ll be starting off the New Year on a bad note if you let your spending get out of control.

You should also know your limits. We’re not talking about credit limits here either. We’re talking about the limits you will place on your spending. Make sure that if you do go out with a credit card, you know what your budget is for spending on it beforehand. Keep track of what you spend on it by keeping the receipts together and totaling them every now and then. This will help you stay on track and make your Christmas – and your New Year – better than ever.

If you enjoyed this post, you can get free regular updates through our RSS Feed, or you can have our latest posts delivered to your email inbox by supplying your address here. Your address will only be used for this purpose, and you can unsubscribe anytime.

{ 2 comments… read them below or add one }

1 PerkStreet Jen October 21, 2010 at 8:27 am

Also consider cash back debit cards to use for the holidays. PerkStreet is offering 5% cash back at a number of popular stores now through the end of the year. Pretty sweet to start the new year off with cash back instead of a huge bill!

No matter how you’re spending, you’re absolutely right about setting a budget for gifts before you head out the door. It’s so easy to get caught up in all the shiny holiday fun, and drown out the sensible spending voice in your head with some Bing Crosby carols. Make a plan and stick to it to have a debt free holiday!

2 Jeff October 22, 2010 at 12:49 pm


As X-mas season looms, here is a video on the responsible use of ATM, debit and credit cards — especially aimed at young people using their first cards.

Leave a Comment

{ 1 trackback }