If you’re planning to pay for your holiday purchases with a credit card this shopping season, make sure you’re being smart about saying “yes” to plastic. Nearly half of Americans planned to use credit cards for holiday purchases last year, according to a TransUnion survey of over 1,000 adults. The jury’s still out on this year’s forecast, but it’s fair to say many U.S. consumers will be turning to rewards cards or other credit cards to support their holiday buying efforts.
Here are seven things you can do to get your credit card ready for the upcoming holiday shopping season.
1. Pay down high credit card balances. If you want to avoid over-the-limit charges and keep your credit score in good shape after the holiday shopping season winds down, make sure you aren’t maxing out your credit cards after this year’s spree. Take inventory of your current debt load on all cards, and start paying down higher balances. You might also consider balance transfer offers that can free up some of the credit line on a rewards credit card, so you can pay off higher balances at low interest rates while using a new card to earn rewards.
2. Scrutinize your credit report. If you haven’t used your credit cards in a while or are unsure what types of balances you are carrying on several cards, order a copy of your credit report from annualcreditreport.com. The report will list all open lines of credit, current balances and your credit limit. This can help you determine which cards are safe to use this upcoming season and which ones need to be left alone until you prepare a debt payoff plan.
3. Review price protection privileges. Many credit card companies offer purchase protection as a benefit to cardholders. Find out what types of purchases are eligible for price protection, which will refund you the difference in price if the price drops on a recent purchase. For example, Citi offers a 60 day guarantee with its Citi Price Rewind benefit with which you can get a maximum refund of $300 per item totaling $1,200 per year. This can be especially helpful if you plan on making big-ticket purchases this holiday season, such as a laptop, smartphone or other pricey device.
4. Determine return privileges. Even though you may be well aware of a store’s return policy during the busy shopping season, some stores may not honor a refund on certain purchases. You can override this rule by paying with a credit card that offers a return guarantee. For example, the Discover Card Return Guarantee allows cardholders to get a refund of the purchase price up to $500 on eligible items if a store doesn’t accept your return within 90 days of purchase. Review the fine print for details about your return rights before you shop.
5. Review cash-back bonus options. Many rewards credit cards offer cash back and special bonuses during the peak holiday shopping season. Make sure you are aware what types of purchases are eligible for cash back and other rewards before you start shopping. You may also be eligible for instant savings at checkout by redeeming special deals and offers directly through your credit card company.
6. Learn about extended warranty protection. If you are planning to purchase televisions, smartphones, computers, vacuum cleaners and other items that may require a warranty, make sure you’re not overbuying by checking if your credit card company offers extended warranty privileges automatically. For example, you may qualify for an extended warranty just for buying a product with a certain credit card. Review your cardholder agreement closely, so you can determine which cards to charge those larger purchases to for extra warranty coverage.
7. Sign up for free credit monitoring services. If you plan on using your credit cards regularly throughout the upcoming shopping season, protect yourself from identity theft by activating credit card monitoring services. Many credit card companies offer free 30-day trials or discounts on monthly services for new customers. You can take advantage of these special offers to get you through the shopping season, and then decide if you want to cancel shortly thereafter. You will receive alerts about any suspicious activity on your credit report and can have some peace of mind while shopping both online and offline this season.
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7 Ways to Get Your Credit Card Ready for Holiday Shopping originally appeared on usnews.com
