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Five Things That Can Set You Back Financially This Holiday Season

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ATLANTA, Nov. 6, 2012 (GLOBE NEWSWIRE) -- The holidays are just around the corner and for many consumers, end of year expenses can derail even the best financial plans. "Understanding the potential hazards can help you avoid them," said Mechel Glass, vice president of community outreach for CredAbility. "A few proactive steps can make the difference between a happy holiday season and one that you could be paying for well into 2012 and beyond."

CredAbility cautions consumers about five things that can set them back financially this holiday season:

Overspending on holiday gifts

Holiday shoppers will spend an average of $749.51 on holiday gifts and seasonal merchandise this year, according to the National Retail Federation (NRF). And while most consumers report planning to spend less than they did last year, it is easy to get carried away when shopping for family and friends, and some will find themselves paying for gifts long after the holidays are over. CredAbility recommends making a list of people you want to buy gifts for and creating a budget that will allow you to make your purchases without overspending.

Opening new credit cards

The lure of a discount on your first purchase or a free gift might be appealing, but CredAbility recommends that consumers resist the urge to sign up for store credit cards. Besides having typically higher interest rates, opening up new lines of credit can have a negative impact on your credit score.

The lure of "the deal"

Retailers know that they will have to incent consumers to shop this holiday season, and while technology, consumer electronics and toys are all expected to be hot sellers, buyers need to be cautious not to let a "deal" cloud their holiday shopping plans. If you budget to spend $50 on your sister, don't be tempted to buy that $100 item just because it is 30 percent off. Also beware of add-ons, such as warranty or replacement plans, "must have" accessories, or special financing options—these can all quickly add to the cost of your holiday gifts.

Shopping for yourself

While holiday sales can be a great time to make some planned purchases for yourself, be careful not to overextend your budget. The NRF reports that consumers will spend an average of nearly $140 on items for themselves this holiday season. Taking advantage of discounts on apparel, electronics, home goods and other items makes sense if you have it in your budget, but if you have to charge these items and pay for them over time, you will eliminate most of your savings.

Travel

While spending time with family is an important part of the holidays, consumers need to consider any planned travel when developing their holiday budget. Planned holiday expenses can put a strain on even the strongest of family budgets. Consumers should also consider the impact of unplanned expenses of things like car and home repairs, medical emergencies, and the loss of a job or a reduction in wages. A little preparation for those things you can plan will go a long way toward having a stress free holiday season and will help you start the New Year on solid financial ground.

About CredAbility

CredAbility is one of the leading nonprofit credit counseling and education agencies in the United States, serving clients in all 50 states plus the District of Columbia, Guam, Puerto Rico and the US Virgin Islands, in both English and Spanish. In addition, we provide in-person counseling through our branch network in five states across the Southeast. Founded in 1964, CredAbility is a family of Consumer Credit Counseling Service agencies that includes CCCS of Greater Atlanta, CCCS of Central Florida and the Florida Gulf Coast, CCCS of Palm Beach County and the Treasure Coast, CCCS of East Tennessee, CCCS of Central Mississippi and CCCS of Upstate South Carolina. The nonprofit agency is accredited by the Council on Accreditation and is a member of the Better Business Bureau and the National Foundation for Credit Counseling (NFCC). Governed by a community-based board of directors, CredAbility is funded by creditors, clients, individual donors and grants from foundations, businesses and government agencies. Service is provided 24/7 by phone at 800.251.2227 and online at www.CredAbility.org

The CredAbility logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=11910

CONTACT: Scott Scredon (404) 653.8833 Scott.Scredon@CredAbility.org John McCosh (404) 260.3108 John.McCosh@CredAbility.org

Source: CredAbility