If all this sounds terribly complex, use our favorite cash back card, the Citi Double Cash. You earn a flat cash back rate of 2 percent on everything you buy (1 percent when you buy it, 1 percent when you pay it off) and you’re not confined to using your card at the one store to get the best rate.
Getting out of holiday debt
There’s a reason the average indebted American household carries roughly $6,000 in debt: plans often go awry or weren’t made in the first place.
Credit cards can get you into debt, but they can also be your salvation.
If you have a sizable holiday I.O.U., consider a balance transfer card. There’s an array of offers, as you can see in our guide of our favorites, but you’ll typically have two months to transfer over your debt after you’ve signed up for a card and then a long period (maybe 18-20 months) of zero percent APR to pay off your debt before interest kicks in. You’ll probably have to swallow a fee (usually 3 percent) of whatever you transfer. This is a good, low-cost option to avoid interest while you chip away at your debt. Warning: You likely need very good or excellent credit to qualify for one of these cards.
An alternative, valuable if you know you want to buy something beyond your budget, is to sign up for a card with a long 0 percent APR period for purchases. You get this type of card when you’re planning on going into debt and want to minimize your interest payments. One of our favorites, the Chase Freedom Unlimited, comes with 15 such months after opening your account, plus you’ll earn a decent rewards rate for your trouble. This will allow you to buy that $1,000 Steelcase Gesture office chair as a gift to yourself, and pay it off in 15 payments of $67.
Christmas, or any winter holiday that involves exchanging presents, is more than the stuff you give or receive. It’s the debating, comparing, and evaluating of what you want and what you think will make others happy, which is made all the sweeter if you can make it to New Years’ Eve without dipping into the red.
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A version of this article appears at Wirecutter.com.
Article source: https://www.nytimes.com/2019/11/13/smarter-living/wirecutter/how-to-save-money-for-christmas.html?emc=rss&partner=rss
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