Avoid These 5 Credit Card Mistakes Before the Holidays | CCCS of Chattanooga
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Avoid These 5 Credit Card Mistakes Before the Holidays

With the upcoming holidays on the horizon, getting your budget in order should be at the top of your list. Heaping expenses onto your credit cards is never the ideal option, especially not with credit card interest rates as high as they currently are, at 24.72%

As the shopping season draws near, here are five credit card mistakes to avoid. 

 

1. Only Paying the Minimum

Although it can be tough some months to pay more than just the minimum payment on your credit cards, more is always ideal. When you have more debt than available credit, it can significantly impact your credit score. If you pay more now, you’ll be ahead of the game when the holiday shopping season is done.

 

2. Expecting Credit Card Rates to Decrease

The Federal Reserve made cuts to the target interest rate in September. While this should have some impact on credit card interest rates, it will be minimal. This means you should continue to pay on your credit cards as much or more than you have been. 

 

3. Compounding Interest

When you carry a balance over from your credit card each month, interest accrues, adding more debt. As this increases, it becomes even more challenging to pay off. Some tips include transferring your balance to a 0% introductory rate card or talking to your lenders about a potential reduction in your rate. 

 

4. Go Into More Debt While Shopping

The holiday season is often synonymous with shopping. While giving gifts is always nice, no one wants you to go into debt to do so. Try making a holiday budget now so you don’t max out your credit cards tomorrow—like 37% of cardholders have done or come close to since 2020.

 

5. Not ask for help

Talk to a credit counselor if you’re struggling to pay off your credit card debt. Not only can they help you create a budget, but they can enroll you in a debt management plan (DMP). Through a DMP, they can work with your creditors to reduce your interest rate and consolidate your credit cards into one affordable monthly payment so you can enjoy the holidays without debt stress.