During the new year, when most households wait to make new purchases until the official start of the festivities, consumer spending always soars. Credit cards are also used more often during the holidays due to their many benefits and cost savings. 

    Overuse of credit cards

    Overspending can occasionally result from the widespread belief that the holidays are a good time to buy, as well as from a number of enticing sales and american express credit card purchase discounts. For many consumers who overspend, paying back only the minimum amount owed—usually 5% of the total amount due—is an easy way out. Since they are not subject to late fees, interest is still charged on the financing charge balance, which can make up between 48 and 49% of the total amount owed each year.

    If you are unable to pay off your american express platinum credit carddebt in full by the due date, you may want to think about making installment payments for any large purchases or the remaining balance. Installment payments, which are considerably less expensive than the high finance charges applied to outstanding dues, are permitted under this facility. The facility normally provides terms with interest rates between 12% and 25% per year and tenures ranging from three months to sixty months. More options available to you Rather than just making the minimum payment needed each month to pay off your debt, think about leveraging your long-term investments through secured loan utilisation, low-yield investment sales, and credit card balance transfers. The interest rate is typically substantially lower than what american express credit card financing fees charge, and your long-term financial goals are maintained.

    Utilising a credit card to make frequent cash withdrawals 

    There is a fee if you make cash withdrawals using your credit card. This charge may amount to 2.5% to 3.5% of the total amount deducted. Cash advances and withdrawals are subject to finance charges from the time the money is taken out until it is paid back, unlike other credit card transactions. Consequently, this cash advance fee can really burn a hole in your wallet, especially if you use your credit card for frequent cash withdrawals, when combined with the high financing charges of up to 47–48% p.a.

    Rather than relying exclusively on american express platinum credit card cash withdrawals to meet your needs, think about applying for loans with quick disbursals, such as loans against credit cards, gold loans, loans against securities, or personal loans. The substantial financing costs and cash advance fees connected with american express credit cardcash withdrawals are more costly than the interest rates on these loans. Remember that using your credit card to withdraw cash isn’t always a smart idea. Make sure you return the entire amount as soon as you can if you must use your credit card for any reason.

    Selecting an EMI period without considering the ability to repay credit card debt: Typically, an EMI has a duration of three to 36 months. It is important to take your ability to repay the loan into account when figuring out the EMI period. Even with lower interest rates, longer tenures are typically more costly for borrowers who are less able to repay their debt. Shorter terms can save total interest costs for borrowers who can pay off their debts faster, but bear in mind that shorter terms also mean higher monthly installments (EMIs). 

    This raises the risk of default or payment delay of any kind, especially in the event of an emergency or unanticipated costs. Remember that how you repay credit has an impact on your credit score as well. Your credit score will gradually rise if you make on-time credit card debt repayments. As a result, both your eligibility and chances of obtaining credit in the future will improve. Thus, consider your ability to repay the remaining balance when determining the length of your credit card installment loan. By doing this, you can lessen the possibility that you will forget payments. 

    Not realising the special advantages of playing cards during the holidays

    Certain credit card companies provide multiple rewards for purchases made during the Christmas and New Year’s holidays in an effort to entice customers to use their cards more frequently. Throughout the Christmas season, they work with manufacturers or retailers to provide a range of distinctive promotions. More items that qualify for EMIs, more chances for cashback and instant savings, more reward points for holiday shopping, and other advantages could be some of these. 

    Therefore, before making any purchases related to the holidays, make sure you are aware of the additional benefits provided by your credit card issuer. If you have multiple credit cards, compare the benefits and offers from each issuer and select the one that offers the best value for the products you wish to purchase. You can also choose to turn your american express platinum credit card reward points into cash if you currently have a significant amount of them. When the bill is adjusted on your statement, this will assist you in paying it. 

    Choosing credit card installment payments (EMIs) without first investigating other credit options

    Credit card users often make these kinds of purchases around the holidays, and they usually select EMi credit cards for them. The american express credit card EMIs normally have a term of three to six months and an interest cost of twelve to fifteen percent annually, though some credit card issuers offer a free EMI option. Before making big purchases with credit card EMIs, consider other credit options like personal loans, gold loans, or loans against credit cards. Think about your credit options before using credit card EMIs for holiday shopping because, in addition to lower interest rates, lenders frequently waive or reduce processing fees.    

    Not using every reward point you have

    Not redeeming american express credit card rewards is another frequent mistake committed by users. Most credit cards, including travel and cashback cards, provide rewards in one way or another as a significant benefit to their target customer base. Make sure you use your american express platinum credit card reward points before they expire to avoid disappointment.