Before you head out the door to Richmond Centre for Boxing Week deals, remember to only put purchases on your credit card that you can afford to pay for, financial experts warn.
A new survey by Ipsos and MNP Ltd., an insolvency law firm, suggests 43 per cent of British Columbians surveyed anticipate feelings anxious when holiday spending bills arrive.
At the same time, a portion of them admit to being lured by Boxing Day deals (16 per cent), paying only the minimum balance on a credit card (22 per cent) and borrowing money they can’t afford to pay back quickly (18 per cent).
“Every holiday season the pressure mounts, and people are tempted to borrow money from payday lenders or rely too heavily on their credit cards,” said Linda Paul, and insolvency trustee at MNP Ltd.
“It’s important people are aware of the extremely high interest rates these types of credit have, because they can easily trap people in a debt cycle.”
While a Boxing Day deal may look tempting, if you can’t afford to pay off your purchases and accrue credit card interest those savings start to look more like costs.
“Those small purchases or Boxing Day door crashers won’t be a great deal after all, if you end up carrying them on credit well beyond the holidays,” Paul said.
She advises to make a plan and spend thoughtfully during the holidays and throughout the year, and to see a professional if you’re feeling overwhelmed by debt.