If you plan on using your credit card for holiday purchases, now is the time to evaluate your current credit card to find out if you can benefit more by using a different card. While this is particularly important if you have credit card debt or if you intend to take on new credit card debt, it can also prove valuable if your current credit card isn’t offering you adequate rewards. Here are three scenarios where a new credit card can help you save or earn money this holiday season:
1.) You are about to take on new credit card debt: If you know you will be taking on new credit card debt during the holidays, don’t do it on a credit card with a 14% or 20% interest rate. There are a number of credit cards available today that offer 0% interest rates on purchases for a full year. Using one of these credit cards instead of a high interest credit card can save you anywhere from a few dollars to $100 or more.
The longer you need to repay your debt the greater your savings, so if you think it will take you six months or a year to pay down your holiday purchases, there is little reason not to take advantage of 0% offers.
2.) You currently have credit card debt: If you currently have credit card debt, a new balance transfer credit card that also offers a 0% rate on purchases will likely net you substantial savings. At present, it is possible to find credit cards with 0% APR balance transfer deals that last 21 months. Transferring two thousand dollars to one of these credit cards from a credit card with a 14% interest rate could potentially save you $200 during the 0% period.
When you add in the savings you can get with the 0% rate on purchases, getting a new credit card with 0% rates on purchases and balance transfers makes a lot of sense.
3.) Your current credit card offers mediocre rewards or no rewards at all: If you are not earning rewards every time you use your credit card, you should be. With the right rewards credit card you can earn between one and five percent cash back on every purchase you make. This, coupled with current promotions that give new customers as much as $100 cash back just for switching credit cards, makes it possible to save close to $200 on holiday expenses you are going to make anyway.
In addition to cash back our top airline miles card, the Chase Continental Airlines OnePass® Plus Card, will allow you to check your bags for free and earn $250 worth of free miles. Deals like this can save a family of four taking a holiday trip $200 in checked bag fees.
Unless you’ve got your credit card situation optimized, there’s a good chance you’re leaving money on the table. Taking a few moments to compare your credit card to other offers can easily translate into a hundred dollars or more in savings. Why not take advantage of this?
About the Author: Jeffrey Weber is a six year veteran of the credit card industry and President of Credit Card Depot Inc. He is an active blogger and former contributor to the Forbes MoneyBuilder blog. For more information and to learn more about current balance transfer deals, visit Smart Balance Transfers.