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Five Things That Help Manage Holiday Credit Card Spending

Five Things That Help Manage Holiday Credit Card Spending

The holiday season often means more expenses and a bigger credit card bill. From gifts to groceries, travel plans and tempting sales, it is easy to get carried away by the wide range of costs that come up in December.

In fact, the average American expects to spend $765 on these things during December, according to data from the CNBC All-America Economic Survey.

The survey also reveals that people specifically choosing to spend money during the holiday season actually expect to spend an average of $865 more than they would at other times of the year.

“Behind the Yuletide cheer is an improved outlook for expected home values, wage gains and stocks—all three are at or above their highest levels since the 2008 recession,” CNBC reports.

While there could be a difference between what you expect to spend and what you actually spend, all too often holiday costs lead to serious credit card debt in the New Year. And adding $800 or so to the average household credit card debt of $7087 is bound to put more pressure on you when it comes to repayments.

But spending money at this time of year does not have to be as stressful as these statistics make it out to be – with a little planning you should be able to get what you need and still manage your credit card balance. This guide is designed to help you do just that, outlining five of the best strategies you can use during the holiday season to help keep your spending and your credit card balance in check.



Budgets are a great way to stay on track with your finances at any time of year. When it comes to the holiday season specifically, a budget helps you manage your spending on gifts, food, decorations and the wide range of social events that often come at this time of year.

Start by listing out the different expenses you know you will have to deal with, including each present you want to buy, additional food, holiday and accommodation costs etc. Once you have an estimate of these costs, add them all together and the total dollar figure gives you a basic budget.

If you want a shortcut with this kind of budget, there are also a number of budgeting apps you can download to your smartphone or mobile device, such as the free one from Mint. These will guide you through the process of creating a budget and could help you stay on track in other ways too.

Consider this amount: is it affordable? Can you cut costs somewhere to save a bit more? How long would it take you to pay off week-by-week if you put it all on credit card?

Asking these kinds of questions will help you realize the value of this budget and make it easier to pay off these expenses in the near future. That should mean less credit card interest from Christmas spending in the New Year.


Shopping lists

There’s a reason the Christmas song says that Santa is “making a list and checking it twice” – lists help keep us organized. This applies whether you are shopping for presents or groceries and, if you stick to the list, reduces the number of impulse buys.

It also means there is less chance of being caught up in the last-minute rush. New research from RetailMeNot has found that 56% of Americans leave their Christmas shopping to the last Saturday before the big day, with most preferring to shop in brick-and-mortar stores.

The research also found that “more than 2 in 5 (43%) consumers who identified themselves as last-minute shoppers have waited until the 11th hour because they didn’t know what to get their intended recipient.” So having a list ready will mean you can start shopping earlier, manage your spending more effectively and reduce the stress that comes from rushing around in the few days before Christmas.

But if you still find it hard to get things before Saturday, a list will at least make it easier to get in and out of stores quickly than if you walk in with only a vague idea of what you need to buy.

Automated transfers

Credit card balances soar at this time of year, and with everything else going on it is easy to forget to make a repayment. Instead of risking a late payment or rushing to transfer it on time, consider setting up automated transfers.

You can avoid late fees by setting up a Direct Debit which you can do through Online Banking. Please make sure you have sufficient funds in your nominated bank account or you may incur a fee.

These repayments can be set at a specific rate – such as “minimum repayment”, “full payment” or a nominated dollar value – which is automatically transferred from a nominated account into your credit card account before the repayment due date.

Most credit card issuers provide this repayment option, with major lenders like Bank of America and Wells Fargo even outlining the different options for their customers. As Bank of America explains, the key thing to remember about this type of repayment is to “make sure you have sufficient funds in your nominated bank account or you may incur a fee” – otherwise, you could end up paying fees for both your credit card and other bank accounts.

But when everything is in order, this option means one less thing to worry about over the holiday period, so it is worth considering if you are worried about remembering to make payments.

Additional repayments

Another way to keep credit card balances in check over the holidays is to make additional repayments. If you find that you spend more on your credit card at this time of year, then paying more off in manageable installments will stop your balance getting out of hand.

A simple way to make extra credit card repayments is to take a little money out of your weekly or fortnightly pay, transferring it directly to your credit card account. So, for instance, if you took $50 from your fortnightly pay and put it straight into your credit card account, you would pay an extra $100 off the balance by the end of the month.

If that sounds like a stretch at this time of year, consider this: transferring just $10 a week to your credit card, would mean you are $40 better off at the end of the month. While $40 might not seem like a huge repayment amount, it is more than the minimum payment for many credit cards and on top of automatic payments could save you a lot of money on interest.

Another way to make additional repayments is to use any bonuses you get from work. A bonus could be a great way to pay down debt, particularly when it comes to credit cards because they have higher interest rates than most other loans.

But even if you don’t have that much debt to deal with, putting all or some of your Christmas bonus towards your credit card balance is a great way to make sure all the extra spending you do doesn’t turn into debt down the line.

Balance transfer offers

The wide range of balance transfer offers available to have the potential to get you off to a great start with your financial goals in the New Year. These deals give you a low-interest rate on your balance for anywhere from a few months to over a year, and some also have low rates for purchases as part of the introductory offer.

The Chase Freedom and American Express Blue Cash Everyday card, for example, both offer 0% on purchases and 0% on balance transfers for 15 months for new customers signing up in December 2014. The Citi Simplicity, on the other hand, has 0% on balance transfers and purchases for 18 months.

These deals mean you can make affordable repayments every month and not have to worry about accruing interest. But it is important to realize that higher interest rates will apply once the introductory period is over, so the more you can pay off in that time, the better.

Balance transfers often come with a fee of up to 3% of the total amount transferred, as well as terms and conditions that vary from card to card. So if you are considering taking advantage of a 0% interest credit card deal now, make sure you compare a few offers before choosing one that seems best suited to your circumstances and needs. That way you can make sure you are using credit in the smartest way these holidays, and hopefully save some money as a result.


While this time of year should be about celebration, there is often a lot of stress around the added expenses that arise. The wrong approach to holiday credit card spending can actually set you up for years of debt, while the right approach makes it manageable from before you even pull out your card.

The five tips outlined here give you a range of ways to manage your credit card around Christmas time so that it becomes a valuable part of the process, rather than a necessary evil.

By developing a budget, making a list, setting up the right kind of card payment or payments and considering balance transfer credit cards, you will also become more aware of the cause-and-effect relationship between credit and debt. And that means you can set things up so that you have less debt and more ways to make credit work for you not only in December but into the New Year too.


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