Should you put Christmas on a credit card?

Should you put Christmas on a credit card?

author: Bryony Pearce

By Bryony Pearce

Before you put the cost of Christmas on plastic, get clued up on the benefits, considerations and how to avoid fines in this blog.


There’s no denying it, Christmas is an expensive time of the year. From presents and parties to festive food and all the home decor trimmings, it all soon mounts up, which is why some people choose to spread the cost on a credit card.

The decision isn’t one to be taken lightly though. While there are a number of benefits to financing some of the festive season with a credit card, if you don’t purchase using your plastic wisely, you could find yourself paying for the price of Christmas long after it’s passed.

We’ll show our credit card Scrooge side a little later on, but for now, let’s take a look at some of the benefits of applying for a Christmas credit card.

Spread the cost

According to figures from VoucherCodes and the Centre for Retail Research (CRR), on average, British families will spend a whopping £821.25 on Christmas. Suffice to say, this isn’t the kind of cash everyone will have just lying around.

Although you should only ever spend what’s affordable for your financial circumstances, putting Christmas purchases on a credit card can help soften the blow and spread the cost of them in the run-up to and post-Christmas.

If you’re able to bag yourself a 0% introductory offer, you’ll have the added benefit of spreading the cost of the festive season completely free of charge, too (providing you clear your balance before the interest-free period ends).

Save money while spending

If you opt for a credit card that comes with perks like cashback, you could earn yourself money as you spend it. That doesn’t mean to say you should start splashing out to rack up cashback rewards, but it’s a nice little extra that you might not otherwise have had.

Protect your festive purchases

Credit cards come with what’s known as Section 75 protection. In a nutshell, this gives you the peace of mind that you’re financially covered if anything goes wrong (for example, if you receive faulty goods or the company goes bust) with any items or services you buy between £100 and £30,000.

So, should the worst happen and something goes wrong with a loved one’s gift, your credit card provider is equally as responsible as the vendor for giving you a refund, ensuring you’re not left out of pocket.

Avoiding unfriendly festive fines

If you take out a credit card to cover all or some of the cost of Christmas, the last thing you want is to be faced with charges and fees - you’ve got enough to pay out for as it is! So, to avoid incurring any extra costs, remember:

  • If you’ve not got yourself a 0% introductory offer, pay your balance off on time and in full each month to avoid paying any interest. To make sure you don’t miss or make a late payment by accident, it might be worth setting up a direct debit.
  • Always make at least the minimum payment. If you don’t, not only could you be charged a fee, but it could leave a mark on your credit history for all future lenders to see.
  • Try to avoid using your credit card to withdraw cash from an ATM machine. It’ll vary from lender-to-lender, but you’ll usually be charged a fee of around 3% of the amount you withdraw for doing this.
  • Your credit limit’s there for a reason. You should stay within it for your own financial management, but also to avoid charges from your credit card provider and affecting your credit score.
  • Only spend what you know you can afford to repay. A credit card might seem like a great idea to cover the cost of Christmas at the time, but if you end up repaying the balance well into the New Year, it can soon become a financial burden.

Things to watch out for

Interest rates

Don’t rush the research stage. If you want to bag the best deal for your Christmas spending, take the time to thoroughly research what options are out there and scout out the best interest rate offer for your circumstances - and remember, the better your credit history, the better interest rate you’re likely to be given.

Credit history

Not only will your credit history impact your interest rate, but it’ll determine whether or not you’re accepted for a credit card full stop.

Missed payments, how much of your available credit you’re using and whether or not you’re on the electoral roll are just a few things that can contribute to a bad credit history. If you think a checkered history is holding you back from the credit you’re after, here are some simple steps to start to improve your credit score in as little as 30 days .

Don’t overdo it

If you’ve unsuccessfully applied for a credit card or two in preparation for your Christmas spending, don’t fall into the trap of continually applying for more. Multiple applications can show up on your credit report and make you seem desperate for cash, which is a bit of a red flag for lenders.

Not only will this impede your chances of being accepted for a credit card this Christmas, but it could damage your chances of being granted other forms of credit down the line too.

So, that’s a wrap (pun intended) for our Christmas credit card guide. All that’s left to say is Merry Christmas, and remember to spend sensibly!

Disclaimer: All information and links are correct at the time of publishing.

author: Bryony Pearce

By Bryony Pearce

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Should you put Christmas on a credit card? Should you put Christmas on a credit card?