Holiday debt: Stay out of the red

Sure, it's easy to run that credit card now, but it's hard to think about the consequences later when it's time to pay off the bill a month down the road. Unfortunately for most Americans, 'tis the season to overspend. The average U.S. household has about a $7000 of credit card debt -- and a large chunk of that is caused by holiday spending sprees.

Here are some pointers, though, that help keep your debts at a minimum heading into the new year.

Planning ahead

• Adjust the holidays to make them more affordable. For example, start by creating a holiday spending plan.

• Limit your impulse items when buying holiday gifts by creating a list of only what you need.

• Shop after the holidays for next year's gifts.

• Limit credit card use by leaving it at home and bringing cash, debit cards or check books instead.

• Keep track of what you spend. If there is money left over don't spend it. Save it so you have a head start for the new year.

Read the fine prints of sale signs carefully. Some of the wording can be misleading.
• Look over receipts to make sure that you were charged correctly.

• Buy gift cards to avoid spending over your limit. A gift card will help you stay right on point on how much you want to spend and will avoid sales that are going on in stores that will tempt you to spend over your limit.

• Don't feel the need to buy such elaborate gifts. Remember it's the thought that counts such as donating to a charity in a loved one's name, buying a non-retail item, or baking seasonal treats.

• Shorten your gift giving list. Don't feel obligated to buy everyone you know a gift.

Avoiding fraud

• Beware of cyber criminals. Every season, scammers use an array of techniques to fool possible victims such as reshipping merchandise purchased with a stolen credit card or promoting merchandise that ends up being a counterfeit product. To stay safe never respond to unsolicited emails or clink on links contained within an unsolicited e-mail. For more tips from the FBI's Internet Crime Complaint Center can be found here.

• To steer clear of identity theft, do not throw out any ATM receipts, credit statements and bank statements. If you are done with the documents, run them through a shredder.

• Always check out unfamiliar companies with local consumer protection agency.

• If you notice any strange charges or discrepancies, notify your bank immediately.

• Never give your credit card information over the phone unless you are making the call.

• Write down the information of the salesperson who helps you at a store such as name, telephone number, address, business location in case there are any discrepancies down the road.

• Review a copy of your credit report at least once a year.

Sources: Consumer Financial Protection Bureau, National Federation of Independent Business, FBI

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