Should You Always Use Your Credit Card for Christmas Shopping?

Nicolas Cesare  | 

The holiday shopping season is upon us. Now is the time to start looking for Christmas gifts and other holiday goodies if you plan on beating the crowds and avoiding stress this holiday season. However, many shoppers are wondering: should I always be using my credit card to do holiday shopping or is it better to use cash or debit? Here are the pros and cons of doing your Christmas shopping with credit cards, debit cards, and cash.

Christmas Shopping With Cash

Using cash is probably the oldest way of doing your Christmas shopping — for some people, it’s the way they grew up with shopping. Even in the age of the internet and vast credit card networks, cash still has its place. Some of the good things about shopping with cash are:

 

  • It’s almost impossible to go over your budget. When you shop with cash, you’re limited to what you’ve got in your wallet. Unless you want to pay costly ATM fees, you have to make a budget of what you expect to spend and carry cash in accordance with that budget. This can be great if you’re trying to budget carefully for Christmas shopping.
  • Cash is accepted everywhere. No matter where you’re shopping, you can be sure that cash will be accepted as payment. This can take some stress out of your holiday shopping experience.
  • You can keep gifts a surprise. With cash there’s nothing tying your spare change to any particular purchase. Your spouse won’t get any spoilers from your wallet when you use cash for Christmas shopping.

 

However, cash is becoming irrelevant in today’s economy as more high tech ways of paying become more common and more user-friendly. Here are some reasons why you might not favor cash this holiday season:

 

  • Cash is less convenient. If you need to stop by the bank or visit an ATM before you go shopping, then you’re just adding another stop to an experience that can already get pretty tiring. You should also consider that ATMs and banks are going to be at their busiest during this time of year, so anything that you can do to steer clear of these places and get straight into your Christmas shopping is worth considering.
  • Cash is less secure. Compared to credit cards, carrying cash can be less secure. If you wallet is stolen by a pickpocket or you accidentally leave it on a store counter, that cash it gone. However, with a credit card you always have the option to chargeback suspicious payments.

 

Christmas Shopping With Debit Cards

Debit cards are the new kid on the block when it comes to modern shopping trends. Lots of people like them because they offer all of the convenience of the credit card without getting shoppers worried about taking on debt. While debit cards are undoubtedly convenient, they shouldn’t be your first choice when it comes to Christmas shopping.

 

  • Debit cards don’t necessarily help with budgeting. Sure, you don’t take on any debt when you use a debit card for your Christmas shopping, but that doesn’t mean you’ll have an automatic leash on your spending. If you go over budget with your debit card and you don’t have the funds in your account, you’ll be hit with an overdraft fee.
  • There are security concerns with debit cards. When you issue a chargeback on your credit card, your credit card company will be eager to see it through. This is because that, until you’ve paid your bill, that money is technically the company’s money. If you have a suspicious charge on your debit card, the lost money is yours, so your bank won’t be quite so eager to track it down.

 

Christmas Shopping With Credit Cards

Some people are afraid of using credit cards because of the association with debt and financial ruin. However, credit cards are actually one of the best ways to do your Christmas shopping. Besides the convenience and security cardholders enjoy, here are some good things about doing your holiday shopping with credit cards:

 

  • Credit cards help build credit. It’s unusual to think that Christmas shopping can help you with your mortgage, car loan, and even with credit card deals. However, shopping with your credit card and paying off your balance once the holiday season is done will do exactly that.
  • You can collect and use credit card rewards. One thing that credit cards have over both debit and cash is the rewards that are associated with your account. Holiday spending can be a great time to reach your reward goals, if that’s something you’re working on, but you can also make your Christmas a little cheaper by using rewards to buy gifts or pay for travel costs. If you aren’t planning on using them yourself, you can always donate your credit card rewards to charity.
  • You can get the best deals with price protection. Price protection services on your credit card will help you take advantage of the best prices for the gifts that you buy. Using price protection means that you can do your Christmas shopping early in the season, avoiding stress while you watch for better prices later in the year.

 

When it comes to Christmas shopping, using your credit card is one of the best ways to buy gifts and other holiday goodies. Talk with your spouse and make a pact not to peep at the credit card statement for gift spoilers. This will keep the spirit of the season up while you take advantage of benefits like credit card rewards and price protection.


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Nick Cesare is a writer from Boise, ID. In his free time he enjoys rock climbing and making avocado toast.

This post was updated November 13, 2017. It was originally published October 31, 2017.