Sneaky Holiday Expenses That'll Hit Your Credit Card

Gifts aren't the only debt inducing culprit

With just a month shy of the impending holiday season, Canadians are starting to hit the mall in droves - and credit card debt levels are due for their yearly upswing. Even the most fastidious budget will take a hit from this annual spending spree - but gifts aren't the only culprit racking up your balance. In fact, a RateSupermarket.ca poll found one fifth of respondents plan to spend over $1,000 on food and travel expenses alone this holiday - sans presents!

The Cost of Connecting With Family and Friends

If that sounds excessive, consider this: hours logged on the road to visit grandma, the turkey picked up at a premium price - even the bottle of wine gifted to a party host - are often costs not accounted for in the seasonal budget.

Incidentals can really add up, and that's where trouble can begin if you are using credit to fund the holidays," said Kelvin Mangaroo, President of RateSupermarket.ca. "With compound interest on credit cards, Canadians could be paying off holiday debt for years if they're not careful. The Holidays Last Longer Than You Think

A poll conducted by TD Canada Trust on last year's holiday spending activity found the average cost for the individual shopper is in the neighbourhood of $1,100 - a combination of travel, foods and gifts. Assuming that spend is placed on a credit card with the standard 19.99 per cent interest rate, it would actually take 11 years to pay off in full at the minimum payment amount. Not so festive!

Mangaroo suggests this impact can be minimized with a lower-interest credit option that makes it easier to pay down a balance faster, and avoid the damage of compounding interest. "They might want to compare the market and consider switching to alow interest credit card or a low balance transfer option if they are not anticipating paying off their holiday spending in full," he says.

Free $100 Gift Card Up For Grabs

Credit card shoppers have even more to gain by comparing the market - until December 15, RateSupermarket.ca is giving a free $100 gift card to all successful applicants of select low interest and cash back credit cards featured on their site. Those approved will also be entered into their sweepstakes for the chance to win $1,100 cash - the perfect amount to wipe out those holiday expenses and start the new year on a fresh financial note. Click here for giveaway details.