Five Reasons to Use Your Credit Card This Holiday Season

As the leaves change and the holiday season approaches, it’s the perfect time to start planning your holiday shopping. With fall marking the start of increased spending on travel, gifts, dining, and seasonal décor, it’s essential to have a smart financial strategy in place. Using your credit union credit card strategically can help you:

• Earn rewards points for every purchase.
• Redeem rewards to offset holiday expenses.
• Access valuable perks like extended warranty protection.
• Secure your purchases against theft or fraud.
• Track your spending for better budgeting.

Earn Rewards Points on Every Holiday Purchase

Unlike debit cards or cash, credit cards can earn rewards points on every purchase, with opportunities to earn even more in special categories. You can then redeem those rewards for:

• Cash back
• Gift cards
• Travel or other experiences, depending on your card.

Let’s say you have a card that earns you 1.5 points per dollar. Spend $1000 in a month, and you’ll earn $180 a year with no extra effort. During the holidays, when big spending occurs—from airplane tickets to gift giving—using your card for large purchases means you’ll accumulate points to pay yourself back.

Important: This doesn’t mean you should spend more than you can afford just to earn rewards. Only purchase what you can pay off. Carrying a balance will accrue interest, which may outweigh the value of your rewards. Remember, interest on cash advances and balance transfers accrues immediately and cannot be avoided, even if you pay off your balance in full.

Redeem Rewards for Holiday Spending

If you’ve accumulated points by using your credit card throughout the year, now is the time to redeem them. Use rewards to:

• Pay for holiday gifts.
• Offset travel costs.
• Cover dining or seasonal decor purchases.

This strategy allows you to stretch your budget further and makes your credit card work harder for you during the holidays.

Take Advantage of Exclusive Cardholder Perks

In addition to rewards, many credit cards offer perks such as:

• Roadside assistance
• Cell phone protection
• Extended warranty coverage on certain purchases.

Tip: Always read the fine print to understand what perks your card offers and how to qualify. These benefits can add significant value during the holidays.

Protect Your Finances with Credit Card Security

If you rely on cash for purchases, there’s little recourse if it’s lost or stolen. However:

• Credit cards typically shield you from liability for fraudulent purchases.
• Many cards allow you to set spending limits and alerts by location or merchant type.

Tip: Stay vigilant by monitoring your account regularly and taking advantage of your card’s security features. Acting quickly can help stop fraud before it escalates.

Simplify Budgeting by Tracking Your Spending

Credit card statements list every vendor where you’ve made a purchase, making it easier to:

• Monitor your spending habits.
• Identify patterns in your expenses.
• Automatically categorize purchases by merchant type.

Using this data allows you to create a more accurate holiday budget and stay on track financially.

Build Your Credit for the Future

If you plan to apply for an auto loan or mortgage, a credit card is an excellent starter product to build your credit. Paying off your monthly balance regularly can significantly improve your credit score over time.

Caution: There are instances where using a credit card might not save you money, such as:

• When transaction fees outweigh the rewards earned.
• When making large purchases (e.g., weddings) that you cannot pay off quickly.

In these cases, consider a personal loan with a lower APR (Annual Percentage Rate).

Do your research and find the card that fits your everyday lifestyle. Happy shopping!