The holiday season is upon us and it is the busiest time of year for retail stores. It is also the busiest time for credit card companies.
“The average American credit card holder charges nearly $1,000 or 40 percent of normal yearly charges during the holiday season, per account,” said Isaac Chappell, a regional consumer science and personal finance management agent with the Alabama Cooperative Extension System.
- Credit cards are convenient. More than half of all Alabama families own one or more credit cards. Cards are used for holiday airline travel or car rental, gifts, food and fun.
“Many times gifts are purchased that would not be possible if you had to pay cash, Chappell added. “ Credit card companies make this easy by delaying payments for about a month or by charging no finance charges during the month of December.“
Many credit card companies also give bonus points or discounts to customers who frequently use their cards. This practice has advantages and disadvantages, said Chappell. Customers enjoy the bonus points, but can overspend in order to receive them.
Another disadvantage to credit card use is cards can be lost or stolen.
Chappell offered some simple guidelines that can help reduce the risk of your credit cards being lost or stolen during the holidays.
- Know where your credit cards are at all times.
- Keep credit cards on your person. Don’t leave them in the glove compartment of your car or put them in your luggage when you are traveling.
- If you have many cards, carry only those you expect to use. Better still, use only one credit card for all you Christmas spending to keep track of what you’re spending.
- Index your credit cards. Clip half an index card to your credit card and keep a running total. The fact that you must look at your total balance before you charge something new can prevent you from charging more than you should.
- Make sure salespeople return your credit card after each purchase. If charge slips with carbons are used, ask for the carbons or tear them up.
- Do not give your credit card number over the phone unless you initiated the contact with a company you know and trust.
- Review the number and kinds of credit cards you own. Cancel and destroy all those you don’t use or need. Department store and gas credit cards often charge higher rates of interest than other cards.
- Keep a record of all credit cards and credit card numbers. Be prepared to act quickly to inform the issuer of a loss or stolen card. Your credit card safety record should include the name of the card, the card users, card account number, telephone number for reporting lost card, company address for reporting lost credit cards and expiration date.
If you lose a card, this information will help you act immediately. After properly notifying the credit card issuer that your credit card has been lost, you are no longer responsible for any charges made against the card.