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Credit Card Trends: Shoppers to Use Less Credit this Holiday Season

by Barbara Marquand

More consumers this holiday season plan to keep their credit cards in their wallets and pay for gifts with cash instead, according to a new survey by the National Retail Federation.

The number of consumers expected to do holiday shopping with credit cards dropped 10 percent from last year. About 43 percent of consumers plan to use debit or check cards to shop, a quarter of shoppers plan to use cash, and 28 percent plan to use credit cards.

Shopping and Credit Card Trends

The trend is indicative of tightening credit as well as the tough economy's impact on consumer spending. National Retail Federation President and CEO Tracy Mullin said in a press statement that with holiday shoppers focused on spending within their limits, it was no surprise fewer planned to use credit cards.

Using credit cards for holiday shopping, though, doesn't have to be a budget buster. If you still plan to charge holiday purchases, follow these tips from the National Foundation of Credit Counseling.

Holiday Credit Card Use

• Just as you make a weekly grocery list to prevent overbuying at the grocery store, make a holiday shopping list and stick to it. Sure, there are lots of bargains out there, but resist temptation. An extra item here and there, even on clearance, can add up to a pile of debt later.

• Start shopping early. Purchasing gifts over a couple of months spreads out expenses and prevents a whopping credit card bill in January.

Guard your Credit Card

• Protect your credit cards. Guard your credit card number when you sign for purchases and watch your purse or wallet. Crowded and chaotic stores make it easier for thieves to pickpocket.

• Keep your charges under 30 percent of your credit limits to prevent hits to your credit score.

Watch Credit Card Debt

• Don't charge more than you can pay off in the first quarter of next year. Pay off your credit card debt as quickly as you can. If you're still paying off holiday shopping for last year, reconsider your plan to use credit cards this year. Remember, when you carry a balance from month to month, there is no grace period. You start owing interest on purchases as soon as you make them.


Published 11/22/09 (Modified 07/09/14)

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