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Everybody is excited for the holidays. Everyone wants to make the celebrations merry and special. But does this mean you should let yourself be stuck in bad debt? Should run up debt just for the sake of the merriment? What can you do to avoid spending traps especially on a holiday season? Take a look at these reminders:

1. Chasing after credit card rewards.

People who own reward credit cards are often prone to overspend during a holiday season. They can simply reason out that charging larger purchases to their credit card will help them rack up more points and get rewarded sooner. But is this justifiable?

In reality, many reward cardholders incur large charges yet fail to pay off their balance in full. As a result, they carry over high balances, get charged with steep interest rates, and struggle with repayment months after the holidays are over.

To avoid being in this situation, you should be more conscious about your spending, particularly your credit card use. Don’t use the holidays as excuse to spend more than what you can afford. Before charging a purchase or a bill to your reward credit cards, seriously consider if you can pay back the full balance on time and if the expense is really worth it.

2. Acquiring a store credit card.

Retailers and merchants take advantage of the holidays by offering special discount cards or loyalty cards to shoppers. Should you sign up for one? At first glance, it might be tempting to get a store card and enjoy a 5% discount from your purchases. The question is, are you really aware of the possible risks?

True, store cards may offer exclusive discount rates but what about the fees? How much would you need to pay each month to keep the card active? How much is the penalty fee if you max out your limit? Will you be using the card often or will you be using it one time only? Weigh the pros and cons before signing up for a store credit card.

3. Getting the buy three, take one deal.

Most shops offer special holiday promotions which could seem like an attractive deal until you take closer look at the offer. For example, a product might be sold in bundles and the label says “buy three, take one”.

Some shoppers might instantly feel that they’re saving money with this purchase but before you thrown in the package to the shopping cart, do you really need to buy that many of the same item? You should also check the price and compare it with the unit price of the product. When you do the math, you might find that you’re not really getting a discount at all or you’re only getting a very small discount.

Furthermore, filling your shopping cart with too many “buy one, take one” deals may cause you to spend more than you planned. Once at the counter, you might realize that you exceeded your budget and be forced to buy because you’re embarrassed not to pay for all.