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Managing Your Spending: Keep Your Credit in Check During the Holidays

While the holidays are an exciting time of the year, they can also cause a lot of anxiety over
finances. In fact, a recent survey found that 71% of people are stressed about spending this
holiday season. Making sure you have a good handle on your credit is a step toward ensuring
you have a less stressful holiday.

Here’s four ways you can combat holiday overspending and keep your credit score from taking
a hit.

1. Watch your spending.

We know it can be easier said than done, but limiting your spending is one way to reduce the
negative impact on your wallet. This means making a holiday budget, including what you owe
to your lenders, your monthly bills, and the amount you designated for the holidays. Make sure
to put a dollar limit on each person and categorize your holiday shopping. This way if you spend
too much money on one category, like food or holiday decor, you can make up for it
somewhere else.
To track your spending, use a method like a spreadsheet or budgeting app to help you keep an
eye on your finances.

2. Watch your credit.

During the holidays, it’s wise to take extra precautions against identity theft. You can do this by
using a virtual credit card number when shopping online. This is a temporary number that’s
linked to your card and allows you to make purchases without putting your information at risk.
Protecting your credit score also means making sure you don’t overspend and making
payments on time to your card each month. You don’t want your credit utilization ratio (the
amount of money available versus how much debt you have) to get too high because it can
affect your credit score.

3. Shop smart.

Starting your shopping early can help you disperse your spending, reducing the impact. But you
may also want to utilize shopping events like Black Friday and Cyber Monday to take advantage
of the sales. When shopping online, make sure to look for discount codes, and you can save in-
store on certain items by looking for coupons. And if you don’t have a lot to spend on people,
get creative. Novelty items don’t have to break the bank. You can also get crafty at home or in
the kitchen for gifts.

4. Get credit counseling.

If you’re overwhelmed, a credit counselor can help. During your appointment, your counselor
will go over your finances with you, help you create a budget, and provide you the tools and
resources to successfully get through the holidays without maxing your credit cards out.


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