Christmas Bring Credit Challenges

Every year, Christmas brings its own credit challenges. With Christmas seemingly coming earlier to us each year, we will no doubt feel the need to get ahead with our present and food buying. This though only leads to us spending more than we should. With the shops full of decorations and Christmas tunes, stores are enticing us to buy our gifts now. This means by the time December has come and gone, we may have spent more over the 2-month period that the shops have been full of Christmas cheer.

This is not all bah! Humbug.

Personally, seeing the kids faces when they open their presents on Christmas morning makes all the preparation worth while.

But that doesn’t mean that it comes without cost. In some cases more of a cost than folk can ill afford. Christmas can come at a heavy price to bear for a lot of people. Rather than let anyone down, they turn to the promise of buy now, pay later that credit and store cards offer.

Don’t get me wrong, credit cards and even store cards, have their uses. This is only true though if you only use them to your advantage. If you are thinking of taking one or the other, we always suggest you go for the credit card over the store card.

We all want to enjoy this time of year. We also all want to save cash and not to fall heavily into debt. This will make the festivities all the more enjoyable. By considering a few advantages and disadvantages of credit and store cards. this will hopefully go a long way on helping you make the right decisions. Christmas does not have to be a credit challenge.

Credit Card Advantages

• More favorable interest rates than a store card
• Many offers on the market, some of which will give you an interest free period
• Some come with money back schemes that give you a percentage of your expenditure back to you (usually between 0.5%- 2%)
• Will protect your gifts as soon as you have bought them as some cars provide purchase protection
• Lets you buy now and pay at a later date

Credit Card Disadvantages

• Can lead you to spend more than you can afford to pay back, which in turn will lead to the interest being charged to your account.
• They can come with a heavy hit in the pocket, with charges for late payments and going over your credit limit.

Store Card Advantages

• Can use them as soon as you are accepted for the card.
• Initial discount (normally 10% off you first purchase) will give you a saving straight away.

Store Card Disadvantages

• Overly high interest rates, which are well above those of a credit card. Some can be as much as 30%.
• Can lead you quickly to debt, if they are not cleared at the end of each month.
• Sold to the customer by assistants who know absolutely nothing about what they are selling.