Expenses are a huge part of your holiday preparations from personal shopping to buying of gifts to preparation of Christmas decorations, food, and a whole lot more. Shopping with your credit card may lead you to incurring huge credit card debt after the holiday season is over. The burden and stress of having to pay off those holiday bills tantamount to the convenience you had from the lavish spending you made during the holidays.
You actually the option to consolidate your credit card bills as a way to save and get lesser interest rates.
Why Consolidate Credit Card Debt?
There are two essential reasons for a credit card consolidation during the holiday season. One is to have self-control or self-discipline in terms of expenses and the other is to have a better, more improved cash flow.
With a consolidate credit card bill, you are able to make fewer payments with better monitoring of your bills as you no longer have to worry about having paid or not having paid this or that bill. You can also easily keep track of your finances having it all in just one credit card.
More importantly, a consolidated credit card debt increases your cash flow. Consider having four different credit cards, which means having to pay four different annual fees whereas a consolidated credit card only incurs one. The interest rate is another factor. You save a lot from getting just one interest rate over having individual interest rates and this can be done through a balance transfer.
Hazards of Credit Card Debt Consolidation
You may be sure of lower interest rates and an improved cash flow with credit card consolidation, but you also have watch out for pitfalls with this procedure. When considering going through a balance transfer, you may be faced with a balance transfer fee, so compare and choose a firm or bank that does not charge high fees. Although most banks offer introductory rate in a consolidation, remember that this is only for certain duration and after which, a higher interest rate may be applied on your bill.
Avoid the Use of Extra Credit Limit
The main purpose of putting all your credit cards into just one is to save on monthly payments, but if you go out of control and use up those remaining credits on your card especially during the holiday season, you may be up for a worse problem on your credit card debt. Do not attempt to make purchases using your consolidated credit card because this is primarily intended for balance transfer to get lower monthly payments. Managing your expenses whether using a credit card or cash always boils down to self-discipline.