For most of us, Christmas means our biggest spending time of the year. So for most of us, that also means an eye-watering credit card bill sometime around the end of January.

Together, we Aussies have 16 million credit cards. Kind of weird and scary, since there are only 22.4 million of us all up, and surely there’s plenty of kids in that 22.4 million who don’t have credit cards yet. The average Aussie owes $3, 140 (or thereabouts) on credit and charge cards. Over three grand?! That means you’re paying some serious interest every month. And not even interest on anything good, like your future house. Just that awful compounding interest on credit card purchases of crappy stuff you’ve long since forgotten. So how to avoid it?

Get tough on your credit card this Christmas. Eek!

First, get rid of your charge cards – those quasi credit cards like department store cards. Those things can really get you into trouble. Secondly, find out what interest rate you are paying on each credit card (usually you can find this by flipping over the front page of your credit card statement. If it isn’t there, call your bank and ask them). While you’re there, ask your bank if there is anything they can do to make Christmas easier for you – lower interest rate, longer number of days interest free, anything like that.

Only use the credit card with the lowest interest rate, and seriously, don’t use it unless you have to – or you’ll hate yourself come January. Get rid of the second, third, or fourth credit card you have – just cut it up (and remember to call your bank to tell them you’ve cut it up, so you can stop paying fees on it).

Make a list of all your current credit card and other debt – and total it up, even if you don’t want to – and remember that with everything you buy in December, you’re adding to that debt, and this means yet more compounding interest for you come January. If you can, put a lump of cash onto your credit card — think of how good you’ll feel in the New Year when the bill is a little less hairy than you feared.

And finally, don’t get too carried away with internet shopping where you have to use your card – set the same budget you would do at the ‘real’ shops. Or if you can’t manage that, force yourself into a budget by only putting a set sum into your PayPal account, and only paying for internet purchases via PayPal. Good luck …

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