According to a Gallup Poll, Americans expect to spend about $900 on holiday gifts this season, and one-third of those adults plan to spend more than $1,000. If these numbers hold up, this will be the record highest in holiday spending for the Christmas season in more than a decade.
Good news to retailers, certainly, but to you and me? Not necessarily. That's because many Americans go into debt to foot the bills for their holiday expenditures. About 30 percent of people will pay off their bills within three months. But another 25 percent will take 12 months to pay these bills. That can get pricey. If you spend about $900 and you put that on a credit card, the interest rate will determine how much it costs you to carry that debt for a year.
A little math for everyone...
Rate of interest for 3 months/12 months:
6.9 percent interest = $16/ $63
12.9 percent interest = $29/ $117
18.9 percent interest = $43/ $172
24.9 percent interest = $56/ $226
And that's without incurring any late fees or over-limit charges. So what do you do to help reign in the potential debt?
Good news to retailers, certainly, but to you and me? Not necessarily. That's because many Americans go into debt to foot the bills for their holiday expenditures. About 30 percent of people will pay off their bills within three months. But another 25 percent will take 12 months to pay these bills. That can get pricey. If you spend about $900 and you put that on a credit card, the interest rate will determine how much it costs you to carry that debt for a year.
A little math for everyone...
Rate of interest for 3 months/12 months:
6.9 percent interest = $16/ $63
12.9 percent interest = $29/ $117
18.9 percent interest = $43/ $172
24.9 percent interest = $56/ $226
And that's without incurring any late fees or over-limit charges. So what do you do to help reign in the potential debt?
