The holiday season is here, and with that for many people comes more spending than usual.
You may find yourself charging this extra spending to one of your credit cards. If this is the case, here are four possible ways to keep your credit score in check this holiday season.
Don’t Apply for Many Retailer Credit Cards
When you’re out shopping in stores or online, it is likely that you will be asked by a retailer or two if you would like to apply for their store credit card and save money on that day’s purchase.
While this may seem tempting, each inquiry on your credit is considered a “hard inquiry” on your account, which could lower your credit score. If you’re approved for the retail credit card on the spot, this brand new account will lower the average age of your credit, which could also lower your credit score. Both of these can work against best practices to keep your credit score in check this holiday season.
If you are considering adding a new credit card to your wallet this holiday season, a better way to do it would be to research ahead of time which credit cards (retailer-based or not) that you are interested in and that you would most benefit from carrying. Some credit cards offer major perks like the Camino Visa Platinum with Rewards that offers you 1 point per $1 spent, which could add up to many points this holiday season!
Set a Spending Limit
When you’re shopping in stores or especially online with a credit card, it can be easy to spend, spend, spend. If you go over your credit limit or spend an amount that you will need to carry as a balance on your credit card for a long time, this could damage your credit score.
Instead, try setting a spending limit that you do not want to go over on your credit card to help keep your credit score in check (and your credit card bill).
Know your Credit Limit Before Shopping
One of the things that could matter the most to your credit score is how much of your credit limit on your credit card you are using. How much of the credit limit that you use is called “credit utilization,” and it’s best to keep this percentage as low as possible.
To keep you in the know about your credit utilization and how close you are to reaching your credit limit, many cards offer the option to set up electronic alerts. Keeping your credit card utilization low could help keep your credit score in check this holiday season.
Know Your Credit Score Ahead of Time
It can be hard to gauge the effective of spending on your credit score this holiday season if you don’t know the starting point. Check your credit score on your recent statements before beginning the majority of your holiday shopping and spending.
Overall, one of the best things you can do to keep your credit score in check is to start by, setting spending limits, keeping your credit utilization as low as you can, and avoiding adding extra credit cards offered by retailers.
Do you need help with your finances? Let us know!
Let Camino help you. We want our members to find the best option that works for their needs. Please go online at caminofcu.org, give us a call at 800-835-3400 to speak with one of our Member Advisors, or contact us for more information.