With the holiday spending season just around the corner, it’s time to start thinking about strategies for not overspending. Ideally, you’d like to be able to get through to the end of the year buying as little as possible on credit. The average family ends the holiday season having spent between $1,000 to $1,500. Since most people don’t plan on the expense of their giving, those holiday costs are typically racked up on credit cards, making your new year miserable with money concerns and busted budgets. If you begin saving a small amount monthly in January, you won’t be tempted to dip into your credit cards. Contributing $100 a month to a Holiday Spending Account will help you save $1200 annually (not including accrued interest). Even though we’re months away from the holiday season, setting aside $100 to $250 for the next few months will give you a bit of relief from your credit cards come December. So start your Holiday Spending Account today. If you don’t end up using it this year, at least it will be in place for the following holiday season. If you are tempted to buy on credit in addition to starting a Holiday Spending Account you should find the credit card that’s right for you. With the large number of credit cards available today, finding the best credit card can be overwhelming. Below is a four step process to guide you in selecting the right cards for you. STEP ONE: Define your objectives. Do you want to lower an interest rate on an existing card? Do you need to keep your business expenses separate from your personal expenses? Clearly define your objectives before moving on to step two. STEP TWO: Know the different types of cards. While Credit cards are separated into seven different categories, we’ll focus on the following: • Regular Credit Cards: These are the traditional credit cards. They give you a specific credit limit based on your financial history and then charge you an annual percentage rate on your outstanding balance. • Rewards Cards: A Regular Card with “bells and whistles”. As an incentive to use the card, you are provided certain rewards depending on how much you charge. These rewards can range from a cash rebate to air travel rewards or benefits at particular retailers. There are many variations and combinations available. • Business Cards: For business owners and sometimes employees. These are good if you need to separate business from personal expenses. They are basically a Regular card but may also have Rewards features. STEP THREE: Know the terms of your current cards. If you’ve owned the same card for a while, you’d probably be surprised at how many of the details you’ve forgotten about your card. If you already own credit cards, take a look at the details to see if you can improve in any of the following areas. – Annual Percentage Rate (APR) on purchases and cash advances – annual fee – balance method used for calculating the finance charge – are there rewards? Get all the details, then start comparing your existing cards to the alternatives. STEP FOUR: Choose a card. Now that you know what your objectives are and are familiar with the terms of your current credit as well as the different types of, you are ready to find the best credit card. As a general rule, how often you pay your bills will have a major influence on the type of card you may want to choose. In short, if you carry a balance, consider a credit card with a low APR. If you’re a business owner, you should consider a business card to keep business transactions separate from personal transactions. Take time this week to review your current credit cards and last year’s holiday spending habits. A little time can save you money and help you begin the New Year in style.