Post-Christmas Spending: Choose Your Credit Carefully

Spending after Christmas can be tricky. Make sure you do it wisely.

15:16 30 December 2014

More people will find themselves owing money by January 2015, and will not care even if they are flat broke. We should think about-amongst many other things- taking the right form of credit to save ourselves from the troubles that might ensue later.

Credit Cards

Don’t be too happy that you managed to take out a credit card offering 0% introductory rate. Many credit cards revert to standard interest rates once the initial interest free period is over, so failing to clear any Christmas debt within this period could cost you much more than you thought possible. Research points out that several people who were lured into such deals last Christmas are still struggling to pay off their debts. If you have made your mind up to opt for this route, you should not attempt to spread the cost over to next year. Otherwise, you will be still repaying your festive borrowing for this Christmas when the next season comes along.

A credit card with a low rate may seem to be a better alternative if you think you will find it hard enough to repay the debts in the short term.

Overdrafts

Several building societies and banks now offer competitive rates for overdraft making your overdraft facility another cheap go-to option. Bear in mind that good deals are only available to people that boast of good credit ratings. There are many ways to see what offers you are eligible for without hurting your credit score.

Loans

A good number of Britons will also take loans such as personal loans to fund their festivity. The amount of money borrowed should be £7,000 or upwards, in order for you to get low interest rates. If you are looking to consolidate several other debts, you could go down this route and enjoy the low interest rates it offers. As was mentioned earlier, only borrowers with good credit scores will be eligible for such loans.