4 Credit Card Mistakes to Avoid During the Holidays

A person holding a credit card and online shopping on their laptop from their couch with wrapped gifts next to them.

Image source: Getty Images

Many or all of the products here are from our partners that compensate us. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.

Don't fall victim to these blunders this year.

Key points

  • It pays to do your holiday shopping with credit cards to rack up cash back and rewards.
  • Be sure to use and manage your credit cards carefully to avoid a host of negative consequences.

The holiday season will soon be upon us, and chances are, you'll be doing some extra spending between gifts, travel, and decorations. It's during this time of the year in particular that you may run the risk of falling victim to credit card blunders, so be sure to avoid these at all costs.

1. Opening too many store credit cards

Often, when you shop in person and go to check out, you'll be asked if you'd like to apply for a store credit card. Usually, the person asking will try to entice you with a discount on your current purchase.

You may be tempted to sign up for a store credit card to not only snag a discount, but rack up rewards on future purchases. But be careful -- store credit cards are notorious for charging high interest rates, so carrying a balance on one could be costly.

Related: See The Ascent's list of the best holiday credit cards.

2. Applying for too many credit cards at once

Adding a few new credit cards to your personal mix may seem like a wise thing to do heading into the holidays. But applying for too many new cards at once could actually damage your credit score, making it harder to borrow money or qualify for credit cards with better offers down the line.

Whenever you apply for a new credit card, the issuer does a hard inquiry on your credit report. A single hard inquiry won't cause much damage. But if you apply for three new credit cards within the same month, that'll cause more of a credit score drop.

Plus, if you have near-term plans to apply for a larger loan, like a mortgage, those credit card applications might serve as a red flag. A mortgage lender might wonder why you need to borrow so much all of a sudden and could potentially deny you a loan.

3. Not tracking your weekly spending

When you pay for purchases in cash, you might remember passing handfuls of money to a series of store cashiers. But when you use your credit cards, it can be easy to forget exactly how much you've spent to date.

As a general rule, it's a good idea to check your credit card balances every week. It's an especially wise idea to do so during the holidays, when your spending is likely to increase. If you don't do that checkup, you might end up with a series of higher balances than you can handle -- and a pile of post-holiday debt.

4. Forgetting about your existing credit card rewards

You may have credit card rewards you can redeem that will offset the cost of some of your holiday purchases. Before you go out and spend your own money, take a look at what rewards you've accrued and see how to put them to good use. This is an especially important thing to do if some of your credit card rewards come with expiration dates.

It's common practice for consumers to shop with credit cards during the holidays. If you're going to go a similar route, do your best to avoid these mistakes so you can end the year on a positive financial note.

Alert: highest cash back card we've seen now has 0% intro APR until 2024

If you're using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee. 

In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes. 

Read our free review

Our Research Expert