Approaching Holidays - Manage Your Credit Cards [Credit Cards]
November 14, 2007, 05:26:21

The holidays are just around the corner. Are you ready? If you don’t feel prepared, you are not alone; 61% of Americans list money issues as the leading cause for their holiday stress. The pressure to entertain, to travel, and to buy gifts for family and friends – especially with food and gas prices on the rise – could stress anyone out.

Do you have a holiday spending strategy? Many holiday shoppers use credit cards to finance the gift-giving season. This is reasonable if their holiday debt is relatively low. Any credit card charges should be paid off at the end of the month rather than paid out over several months, to save money on fees, penalties and interest. The national average interest rate for credit cards is currently 13-14%.

You could save money this holiday season by doing some research to find a low-interest personal loan. Personal loans have evolved over time to stay competitive. These days, borrowers have many options to choose from. Secured or unsecured personal loans can be used to finance holiday spending. These loans generally have lower interest rates than credit cards; some credit unions offer personal loans with as low as 7.7% interest.

Credit card interest rates are higher, and card holders who don’t pay off their balance each month will find that most of their monthly payments go toward fess and interest. Also, card holders who have trouble controlling their spending might be tempted to charge too much during the holiday shopping season. Credit cards represent a source of constantly available, “free” money that isn’t free at all. With personal loans, you can borrow only the amount you need to get through the holiday season.

You can also save money after the holidays by using a personal loan to consolidate your debt. Do you have several credit card payments? It might be worth your time to take out a personal loan and pay off your cards. That way, you will have only a single loan to repay each month, with much lower interest.

Some other ways to control your holiday spending include shopping after 6pm on the evening before store sales “officially” start; making a list of who you will buy for, and sticking to it; and taking a hard look at your financial situation and deciding how much you can spend on each person on your list without causing yourself a hardship. If you shop online, look for stores that offer free or discounted shipping; those charges can really add up.

Most of us feel a financial squeeze during the holidays. Luckily, shoppers have more options than ever before. Rather than loading up your credit cards at the last minute, take some time before the holiday crunch to plan your best spending strategy. If a low-interest personal loan suits your needs, shop around for the best deal possible. Banks and credit unions want your business, and they will compete for it.

Low interest loans and a set spending budget can prevent a lot of holiday woes. This year, give yourself the best gift you can – peace of mind.

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