During the holidays, credit card companies offer all sorts of perks to get shoppers to sign up. American Express’ Daily Wish and Chase’s Ultimate Rewards are two popular programs that give away money, merchandise discounts, and gift cards to frequent card users. This year, however, fewer consumers are choosing to pick up a new card, and they will be more likely to use a debit card to buy their holiday gifts.
According to the Bedford Report, 43 percent of consumers will be shopping with their debit cards. Only 27.6 percent will be using credit cards, just slightly more than the 25.7 percent of consumers who will use good old-fashioned cash for their purchases. Furthermore, there was a 24 percent drop in open credit card accounts since 2008.
Why the change? Unemployment is still fairly high, so money is tighter for many families. Some people don’t trust themselves with a credit card. They might have trouble keeping track of how much they have spent, or they know that they don’t have strong self-control when it comes to holiday spending. Responsible consumers might prefer having a set amount of money on hand to pay or the threat of overdraft charges keeping them in check.
To read more about holiday spending, check out My Credit Specialist’s holiday shopping guide, coming soon on their blog at http://blog.mycreditspecialist.com, and if you are unsure about your credit score or credit history, sign up for a free credit evaluation at http://www.mycreditspecialist.com.
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