Halloween has only just been and gone, and you might curse us for mentioning it... but now's a good time to start thinking about your Christmas shopping!
Not only will you be able to avoid the hectic Christmas shopping rush, but you may well make some savings if you start thinking about buying gifts now, as well as spreading your spending out over more paydays.
Section 75 offers protection
Have you already got an idea of a big purchase Christmas gift for someone in mind? Maybe you’re thinking of treating your kids to that games console they’ve been pining for, or perhaps someone in your family is in need of a new TV?
Well, as long as you’re comfortable you’ll be able to repay what you spend, Section 75 of the Consumer Credit Act could protect you should your purchases be faulty or not show up – providing that you buy them on your credit card.
So long as what you’re buying costs between £100 and £30,000, if the product is faulty or doesn’t arrive (perhaps because the retailer goes bust), then you can reclaim what you spent from your credit card provider, regardless of whether it was bought online or in a store.
This works even if you only paid for part of the product on your credit card. For example, you might have paid a £100 deposit using your credit card and the rest with your debit card. In this case, should the gift not turn up or if it shows up damaged or faulty, you can claim all your money back from your credit card provider.
As another example, you might be thinking about paying for your son or daughter’s driving lessons as a Christmas gift. If this is on the cards, it usually works out cheaper to buy lessons in a block of 10 or 20. If you were to make even just £1 of the payment on your credit card, you would be covered even if the driving school went out of business, as long as the driving lessons cost more than £100 in total. Even if your child had started taking the lessons, you’d still be able to claim a refund on the lessons they didn’t get to take.
Be wise with your credit card this Christmas
Section 75 is a good piece of protection to take advantage of if you’re planning on making big purchases this Christmas, but don’t let it tempt you into spending more than you originally planned. It’s always a good idea to stick to a budget, especially at Christmas when your bank balance can take quite a hit.
Before you flash the plastic, consider how you’re going to repay what you borrow. If you think you won’t be able to afford what you’re thinking of buying, it’s probably best to hold off for now. Besides, would your partner want you to still be paying for their flashy new games console one year down the line?
However, if you’ve budgeted carefully, a credit card could help you to spread Christmas costs over a number of months, and might be a helping hand when money is tight during the festive season. Just remember to check how much you’ll have to repay each month, including any interest. The Money Advice Service offers a free calculator to help you work this out, which you can find here.
If you are looking to apply for a new credit card, why not find out more about the Ocean credit card.
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Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender.