The best is to save for festive season spending long before the decorations go up…. For many, this advice may come too late. For them, festive season spending may mean maxing out current credit cards, opening new lines of credit or taking on extra debt. Excessive enquiries for new lines of credit, higher balances compared to credit limits and large amounts of debt can all be harmful to a consumer’s credit health. TransUnion offers five tips to help get financially fit before the festive season:
- Check your credit reports frequently: Most banks will not allow you to use your credit card overseas unless you have already informed them where you will be going, and the dates that you will be away. This is a smart precaution as it helps the financial institution to know that activity on your card in a foreign country is not necessarily a suspicious activity. It also helps you to avoid false alarms - mistaken credit fraud alerts or account access freezes.
- Know your score: Understand what affects your credit score and take the necessary steps to reaching healthier credit. The higher your score, the better rate you are likely to receive.
- Make a Gift List and Check it twice: The list should include all the people you plan to buy holiday gifts for, along with a Rand amount you plan to spend or the item you plan to purchase. Stick to this list when it comes time to buy holiday gifts to avoid overspending.
- Budget and Save: Review your list and calculate how much you plan to spend on gifts. Divide the total by the number of salary checks you will receive between now and when the holiday shopping season begins. It’s also a good idea to set aside additional money to be used for food and entertainment during the festive season.
Save for Yourself: Remember, not only does saving for the holiday shopping season help alleviate stress, but if possible, you should also save a portion of each salary check to pay for any unexpected financial crises, such as a health emergencies or a major repair on your car.