Black Friday is only a few weeks away, and the sales emails are already piling up. A credit card can make holiday shopping a lot easier, but it can also make it easy to lose track of what you've spent. Here's how to enjoy the season without still paying for it in March.
Start With a Number
Before you open a single sale ad, decide how much you can spend on the holidays in total. Remember that there are more expenses than just gifts – think travel, food, decorations, extra fuel, even shipping. Many people forget the last few and end up blowing past their budget before they've bought a single present. Break it all down and think through what makes sense in each category.
Keep in mind that even though you CAN spend a certain amount, it doesn’t mean you SHOULD spend that amount. Your credit limit is simply the most the card will let you charge. It says nothing about what you can comfortably pay back in a reasonable time frame. Build your budget around your own income and your January bills, then use the card to stay within it.
Know How You'll Pay It Off
Interest is what turns a good deal into a mediocre one. If you carry a balance, a 30% discount on a TV can quickly be offset by the interest on that TV, and the longer it takes to pay off, the less of a deal it was.
The simplest approach is to pay the balance in full each month. If that isn't realistic, pay as much as you can above the minimum, and plan for how a bigger December statement will fit into your budget in January and February. Even a rough plan puts you ahead of most shoppers.
Be Picky About the "Deals"
A sale price only saves you money on things you were already planning to buy. Compare prices at a few stores, check the return policy, and look at shipping costs before you check out. If something isn't on your list, give it 24 hours. Most of the time, the urge fades and the money stays put.
Watch out for store card offers at the register, too. An extra 15% off today looks great, but those cards often come with high interest rates that can cost you more than you saved.
Keep Scammers Off Your List
The holidays are a busy season for fraud, and the scams tend to look like normal shopping. Texts about a missing package, emails about a problem with your order, and ads for prices that seem too good to be true are all common. Don't click the link. Go directly to the retailer's website or app instead.
Stick to websites you know, make sure the address starts with "https," and avoid entering card details on public Wi-Fi. If you get a suspicious message that claims to be from AUCU, call us at 334-844-4120 or use the number on the back of your card.
Check In Often
Don't wait for your statement to find out what you've spent. A quick look at your account every few days during the holidays makes it easier to catch a charge you don't recognize and keeps your total from sneaking up on you. The myAUCU mobile app lets you check your balance and set up alerts so you can keep an eye on things from anywhere.
If a charge looks unfamiliar, check the merchant name, amount, and date first. If it still doesn't ring a bell, give us a call.
Your Trusted Financial Partner, Online and in Person
As a member-owned financial institution, our focus is on helping members make informed financial decisions and providing the personal service they deserve.
Whether you're shopping from your phone, managing your account through online banking, or stopping by a branch in Auburn or Montgomery, our team is here when you have questions. If you want to talk through your credit card options or have concerns about activity on your account, contact Auburn University Credit Union at 334-844-4120.
