Avoid credit card binge

Detroit Free PressNovember 23, 2013 

Head into the mall this holiday season, and you won’t just be bombarded by 50 percent off signs or two-for-one deals. Once you hit the cash register, someone is bound to tempt you with more deals if you sign up for text messages, credit cards and other goodies.

The pitch this holiday season is to get you hyper-connected to a store, restaurant or credit card. It’s a two-way street. Some discounts may be worth a little extra annoyance. But as we try to watch our wallets this holiday season, it’s key to question whether an extra 10 percent off just encourages us to spend even more.

Some tips on how to avoid a credit card binge:

•  Some consumers swear that the best way to track their spending is to use cash.

Others only put their purchases on one credit card or one debit card, just to carefully watch on the total amount they’re spending each month.

•  If you use more than one credit card during the holidays, create a ledger to track what you’re spending on each card. You don’t want to forget about two or three $100 purchases on different cards.

•  It might be better to simply pull out the credit card that has the lowest annual rate, regardless of the rebates or cash back, especially if you will not immediately pay off the full balance.

•  Consider how often you really shop at a store before opening a credit card. Some deals are tempting. But if you open too many credit cards at once, your credit score will drop.

•  Be realistic. You might plan to pay off a large purchase before the limited 0 percent offer expires on the new credit card opened to buy the item. But what if you do not get that big tax refund as soon as you expect? Then, you could be paying a very high interest rate – in the 25 percent range -- that may be charged from the date of purchase.

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