Like racers on their mark, many shoppers barely get through their Thanksgiving dinners before they are running out to begin making their Christmas purchases. If you are among those who enjoy the rush and throng of Black Friday, you may get caught up in the excitement, spending more than you had planned. Thankfully, you remembered to bring your credit cards.
However, did it occur to you that the balances you still owe on your credit cards date back to last Black Friday or perhaps even the year before? A recent review of data finds that 25 percent of consumers who will use their credit cards this shopping season still have a balance from the previous Christmas. This means that any money you saved on those Black Friday deals last year you likely lost in the interest you paid on your credit card balances.
Digging a deeper hole
While using credit cards to do your Christmas shopping may not be a bad thing, consumers easily fall into trouble if they do not pay the full balance by the end of the month. You are not alone if you expect your credit cards to carry you through the holidays. Statistics show the following interesting facts:
- About 73 percent of those surveyed in Texas and beyond plan to use credit cards to purchase gifts this holiday.
- Last year, that number was 58 percent.
- Most consumers expect they will be paying on their holiday credit card debt into next February.
- Last year, shoppers took an average of 2.3 months to pay off their holiday debt.
- About 20 percent of shoppers say they will try shopping loans instead of using their credit cards.
Shopping loans are a new method of obtaining credit at the point of sale. Similar to taking out a small loan at the cash register, you will complete a questionnaire at checkout, wait for approval and sign your name to accept the loan. If you plan to try this type of loan, be aware of the exorbitant interest these creditors charge.
Breaking the cycle
While the best plan for holiday shopping is to set a budget and save throughout the year, that is not always possible, especially if you are already struggling with your finances. You may realize your credit card debt has become a burden you can no longer manage. Then, you may find guidance with the help of a skilled and compassionate attorney.