How Worried Are Canadians on Overspending During the Holidays?
For Canadians as well as our neighbours down south, Christmas shopping really started, well, now…especially with all the Black Friday sales being advertised already.
It’s really that period between now and mid December when scores of us are doing our Christmas shopping. But that blitz of shopping during the last two months of a year only blinds us to the reality ahead in the new year…when we look at our credit card bills to see the damages done to our wallets and bank accounts.
According to a survey done by Ratehub.ca, almost one in three Canadians (31 per cent) are afraid to see their credit card bills come January.
The survey also found the majority of Canadians (61 per cent) agreed with the statement "the holidays are the most stressful time of the year financially."
Ratehub’s survey, which polled over 1,200 Canadians, also found that:
- 30 per cent said they won’t be able to pay off their credit card bills by their monthly statement due date - meaning they’ll need to pay interest on their holiday spending.
- Of those that will require more time, 33 per cent think they will need over 3 months to pay off their credit card bill from holiday purchases.
- Over a quarter (26 per cent) will require 3 months, a quarter (25 per cent) will require 2 months and 16 per cent will require 1 month.
- More than a quarter (26 per cent) will spend money they don’t have and go into debt just to keep up with expectations from friends and family around the holidays.
- When it comes to setting spending limits with friends and family, Canadians are almost evenly split between speaking up or just going with the flow. Only 38 per cent speak up if they’re uncomfortable and can’t afford the set limit, while 42 per cent just let it go and spend the expected amount.
If you think that you as a consumer are forever stuck in this cycle of spending every year with little options to escape from it, there are some suggestions on how to use your credit card more wisely, according to Ratehub:
- Take a look at your holiday spending last year. Did you set a budget, and did you stick to it? Did you take on debt? Knowing what you did last year will help ensure you’re making the best decisions this year - especially when it comes to your method of payment.
- Unless you’re a credit card connoisseur, stick to one this holiday season. If you’re one of the Canadians worried about seeing your statement in January, you’ll want to stick with one card. It’ll be easier to control your spending and not overspend.
- Stop hoarding your rewards. If you’ve been racking up points for months or years and haven’t spent them nor have a plan to, now’s the perfect opportunity to use them to help save money over the holidays or even stretch your budget.
- Compare, search and save. And not just for your holiday purchases this year. A study we conducted earlier this year found that Canadians are missing out on almost $1000 worth of credit card rewards! There’s no time like the present to take a look at your current credit card and the options out there to ensure you have the best one for you.
So as you induldge in your holiday shopping this Christmas season, it’s important to watch what you spend, lest you want to avoid the physical and psychological discomfort when you get your credit card bill in January next year.