Now that you can almost smell the turkey roasting in the oven, you might be in the mood to shop: NerdWallet’s 2018 Holiday Shopping Report found that the nation’s consumers plan to spend an average of $776 on gifts this year, which is $116 more than they said they planned to spend last year.
They’ll also be buying more of those gifts with credit cards — almost three-quarters of shoppers surveyed said they plan to buy presents with a credit card, while just 58% of shoppers said that last year. They estimate it will take them just over three months to pay off those purchases. Meanwhile, more than 1 in 4 people who purchased gifts with credit cards last year are still paying off those balances today.
That means they’re likely paying much more for those gifts than they actually cost, given the relatively high interest rates on most credit cards. In fact, if you charge the average planned spending of $776 to a card, then make only the minimum payments, it will take 4.4 years and cost $295 in interest to pay off that debt, according to NerdWallet’s calculations. That means you would pay 38% more for your gifts.
But for shoppers who pay off their balances each month, using credit cards can really — well, pay off.
“I love travel rewards, so I’ll be using my Chase Freedom Unlimited® [to buy gifts],” says Jason Steele, a travel and credit card expert in Denver. He adds that those who prefer cash back should consider a card like the Citi® Double Cash Card – 18 month BT offer, which offers 1% cash back on purchases and 1% back when you pay them off.
In addition to earning cash back and rewards, shoppers can also give their budgets a boost with some lesser-known strategies. Here are five under-the-radar ways to use credit cards smartly this holiday season:
1. Sign up for automatic refunds
Some credit card issuers have phased out “price protection” as a side perk, but that doesn’t mean you can’t still get a refund if the price of an item drops after you buy it.
When you sign up for an email tool like Paribus, it automatically scans your email to review your online purchases from participating retailers, then monitors the prices of those items.
“We make sure the price you paid is still the lowest price,” says Paribus’ director of strategy, Jenna Kaye-Kauderer. If the price drops, it helps you get a refund. Sometimes, that refund processes automatically and sometimes Paribus tells you how to ask for it from the retailer.
The email tool Earny offers a similar kind of price protection and deducts a 25% fee from any refunds you receive.
Using these tools to monitor prices helps relieve some of the pressure from holiday shopping — except, perhaps, for deals that are exclusive to Black Friday, it won’t matter when you shop, because you can still get the best price.
2. Use a card with extended warranty protection for big purchases
If you’re making a big purchase such as an appliance or video game console this holiday season, check to see whether any of the credit cards in your wallet offer extended warranty policies.
“It can be more valuable than points,” Steele says of the warranties. Eligible American Express cards, for example, offer up to two years of extended warranty protection beyond the manufacturer’s warranty. Coverage goes up to $10,000. Citi consumer cards also offer extended warranty coverage for an additional two years, with a maximum coverage of $10,000 per item for up to seven years.
3. Choose a store card if you’ll be shopping at one merchant
“Store cards, like the Target and Kohl’s cards, often offer extra perks, but watch out for steep APRs,” says Trae Bodge, a shopping expert and founder of the website truetrae.com. “Shoppers can really benefit from using these cards, but only if they pay them off in full every month.”
She says that she shops a lot at Amazon, so she uses the Amazon Prime Rewards Visa Signature card for 5% back on her Amazon and Whole Foods purchases.
4. Visit your card’s bonus mall
While some card issuers have been sunsetting their bonus malls — online portals where you can shop and earn extra points or cash back — a handful still remain.
If you have a Chase card that earns Chase Ultimate Rewards® points, you can shop through that online portal to earn bonus points at hundreds of stores. The Wells Fargo Earn More Mall also lets you earn bonus points on purchases at select stores.
5. Act now for a sign-up bonus
If you’re thinking of applying for a new credit card soon, consider getting it before Black Friday so you can earn any available sign-up bonus, Bodge says. You typically have to spend a certain amount on the card within a few months of opening it, so getting the card now can help ensure you hit the required spending amount with your holiday shopping.
But as with other kinds of credit card spending, you want to make sure the lure of rewards and sign-up bonuses doesn’t lead you to overspend or make you unable to pay off the balance each month. That would be a quick way to put a damper on all the holiday festivities.
This article was written by NerdWallet and was originally published by Forbes.