Mortgage Advice

How to Maintain Good Credit During the Holiday Season

November 27, 2013

The holiday season is in full swing, and shoppers will soon be hitting up stores for the hottest deals of the season. With Black Friday right around the corner, we thought it would be beneficial to give some tips on how use credit responsibly as you’re shopping for gifts this holiday season.

Today, Dave Sullivan, marketing director for Credit Technologies, talks about some dos and don’ts when it comes to using credit during the holidays. 


Be tempted to open new credit cards (no matter how good the deal is)

In the spirit of Black Friday and the holiday shopping season, credit card companies and merchants alike will be offering “special deals,” such as cash-back bonuses, reward points and exclusive discounts for opening new credit cards. Don’t let these offers tempt you to open new lines of credit, especially if you plan on purchasing a home in the near future.

Open a new credit card and close it right away
Even if you open a new account and close it immediately, the original credit inquiry will remain on your report for at least six months. Because the length of your credit history also has an impact on your credit score, you want to avoid closing credit cards–even ones you don’t plan on using.

Charge too much on your credit card
It’s important to be aware of how much you’re charging to your credit card and keep the balance low. During the holiday season, you want to keep the balance on your credit card below 50% of the total available credit limit. In other words, don’t max out your credit card! After the holidays, try to get your balance back down to 5-9% of your limit to get the best credit score possible.


Budget for your holiday spending ahead of time
By budgeting for holiday expenses ahead of time, you’ll be able to keep your holiday spending on track and keep your credit card balances well below the allotted credit amount.

Use cash whenever possible
Set aside a “Christmas” fund and use cash from that account to pay for gifts. By using cash instead of credit, you’ll be more likely to stay within budget and avoid falling into the habit of swiping your credit card at the checkout line.

Spread your credit card debt over multiple credit cards
Spreading your purchases across three to five credit cards, as opposed to putting every purchase on one card, will help keep your balance for each card below 50% and minimize the impact on your credit score.

Follow these tips to maintain healthy credit over the holiday season and into the New Year. For more tips on how to maintain a good credit score, read our blog post, “5 Ways You Can Improve Your Credit Score.”

Do you have any stories to share about using credit cards during the holiday season? What tips can you share from your experience?

dave-sullivanWith more than 20 years of experience providing state-of-the-art credit reporting solutions to financial institutions and mortgage lenders, Dave Sullivan has established his reputation as an industry expert. In addition to serving as the Marketing Director for Credit Technologies and on the Board of Directors of the MMLA, Dave enjoys providing credit tips on his weekly video blog, He is a Western Michigan University alum and enjoys working on classic cars in his spare time.