With the holiday shopping season about to kick off, it’s important to understand your financial situation before heading to the stores so that you can create a sensible budget. By shopping smartly, you can take steps to make sure your credit score doesn’t suffer for the sake of the season. That way you can remain merry long after the holidays are over.
Shop Smart
There are a number of steps you can take while shopping this season to protect your credit score during the holiday rush. First, it’s a good idea to set boundaries. If your score is lower than you would like — or even if you want to maintain it — it’s important not to spend outside your means. A good rule of thumb is to try to keep your credit card balances well below 35% of your total credit limits. If you know it’s hard for you to resist buying just "one more thing," try paying with cash. That way, you’ll be more likely to stay within the budget you set. And, as appealing as it can be to save 15% on your holiday purchases, it’s best to avoid retail credit card offers. Opening too many lines of credit can negatively impact your credit score and could ultimately cost you more than you’d save.
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