Credit cards are a popular choice of payment method lalo na ‘pag holidays.
The holiday season is full of fun, family, and let’s face it, major, major gastos. Gifts, food, decorations, and travel can all add up way beyond your 13th month pay…
Financial stress is a common issue among Filipinos, particularly during times of increased spending like the holiday season. And sometimes, this financial stress can mean a big spending affecting your credit score without you even realizing it!
Pero don’t worry! Let’s talk about how this happens and how you can avoid damaging your credit score during the holidays.
How holiday spending can affect your credit score
In the Philippines, more and more people are using credit cards for their holiday shopping. According to the Bangko Sentral ng Pilipinas (BSP), there were over 10 million credit cards in circulation in 2023. While convenient, using your credit card heavily during the holidays can hurt your credit score.
The problem starts when you use more than 30% of your credit limit—this is called your credit utilization rate. Kung malapit mo nang ma-max out ang card mo, it signals lenders that you may be relying too much on credit. In addition, missing payments can have a big impact since payment history accounts for about 35% of your credit score.
Tips to maintain or improve your credit score this holiday season
Para masiguradong hindi ka magkakaproblema sa credit score mo, here are a few tips:
Set a budget. Bago ka mag-shopping, set a spending limit. This helps you avoid overspending.
Use your credit cards wisely. Keep your credit utilization below 30%. Kung kaya mo mag-cash, use that instead.
Pay on time. Avoid late payments by setting reminders or autopay options. Late fees also add to your expenses!
Avoid applying for new credit. Maraming tempting offers during the holidays, but applying for new credit can negatively impact your score.
The holidays are meant to be enjoyed at hinding hindi dapat maging source of stress. Mas ramdam ang holiday spirit ‘pag alam mong hindi ka nalulunod sa utang. With a little planning and discipline, you can enjoy the holidays with peace of mind.
Sa ganitong paraan, you’ll start the new year right—less debt, a healthy credit score, and more savings. Remember, it’s not about how much you spend but how you are managing your finances right.
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