Credit Cards vs. Personal Loans; which is better for Xmas expenses
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December 25, 2018
The most wonderful time of the year is here. And with the merry-making, the laughter and quality time with family, Christmas also brings with it a truckload of expenses. Firstly, there are the gifts, one for each one of your loved ones and quality gifts usually have sizeable price tags.
You’ll also want to pamper yourself a little, maybe buy that one thing you’ve had your mind set on for a while. Once you’ve got passed Christmas it will be New Year and you might want to go on a short vacation or let your hair down and party hard – all of which will again cost you!
In case you don’t have all the funds to make your plans happen- you have two options to cover your expenses. You could either opt for a personal loan or just swipe away on your credit and the following article will help you decide which one is better for you.
Limit your spending:
With a credit card, you can spend right till your credit limit. Considering that most cards have enormous spending limits, there’s a chance your credit card bill will give you nightmares the following months. Moreover, if you cannot clear the bill in a single month, you might have to deal with the exuberant rates of your credit card. However, if you opt for a personal loan, you have a certain amount disbursed to you. This automatically keeps you spending in-check. So, if you think you might go a little overboard with a credit card, a personal loan will help you limit your spending.
Handling the debt:
You’ll have to repay your credit card bill the following month. If you’ve managed to rake-up a sizeable amount, paying off your debt could be a little tricky. Personal loans, on the other hand, come with much longer tenures and allow you to spread the repayment over a few months. This means small EMIs that you can cover with ease and slowly repay your way out of debt.
You could also swipe your credit card, make all your payments and then consolidate that debt with a personal loan. This will give you more time to repay your debt and ensure credit card bills don’t ruin your life post the festive season.
Sure, credit cards are an important factor impacting your credit score. However, successfully applying for and repaying a personal loan should do your credit rating a world of good. In fact, repaying a personal loan without any issues will boost your credit rating by a number of points.
Surely, credit cards have their place but personal loans seem like a much better option for Christmas expenses. If you have any doubts, feel free to connect with us – one of our finance executives will be more than happy to clear any of your doubts. We hope this article has been helpful, good luck and a merry Christmas in advance!