5 advantages to using your credit card this holiday season

The holiday season always seems to come faster than expected. This can leave you with a large shopping list and not enough paychecks before the holidays to comfortably handle the cost.

But, don't panic. There's good news! There are ways to effectively pay for your holiday spending using a credit card that won't leave you with a large debt in the new year. Read on to learn some tips to make the most of your credit cards this coming holiday season.

1. Get cash back rewards

If you want to find creative ways to save money while making purchases — like that latest gaming console on your child's wish list or maybe you're going big this holiday season and need to buy an engagement ring — you'll want to find a credit card that offers benefits for each dollar you spend. Enter cash back rewards.

Cash back rewards can be your ally in the mission to save money. A "cash back credit card" allows you to earn back a percentage of every dollar you spend on qualifying purchases.

Here's how it works. Let's say your credit card provider offers 1.5% cash back, and you use the card to purchase an item that costs $1,000 — you'd earn $15 in cash back. While that doesn't seem like a lot at first glance, it's important to understand that earning cash back — especially during the holiday shopping season — adds up over time. Every dollar you save along the way will add up in the end.

How you receive your cash back rewards varies among credit card providers, but usually fall into categories like statement credits and gift cards. Some providers even give the option of having your earned cash back deposited into a bank account. All of these, particularly the statement credits, are excellent opportunities to help you save money while tackling your holiday shopping.

2. Boost your rewards with credit card sign-up bonuses

Although there are many features to weigh when opening a card, sign-up bonuses are the cherry on top. These are new customer promotions that offer a "cash bonus" when you meet certain spending requirements within the first few months of account opening.

Here's an example of how a sign-on bonus works: You are required to spend $2,000 within the first three months from account opening to earn $200 cash back. When the spending threshold is met, your cash back bonus will be awarded within the timetable provided upon opening your credit card account.

Pay close attention to the terms and conditions associated with the offer, so you know exactly how much you need to spend to activate the sign-up bonus and when you can expect to see your reward. While it's likely that you won't have much trouble reaching the spending amount required with your holiday spending, it'll help alleviate any buyer's remorse you might feel by knowing exactly when you can expect to see your reward, which will help significantly with trimming the amount of debt you'll carry into the new year after your holiday spending.

3. Transfer balances to consolidate and budget more efficiently

Sometimes finding ways to save during the holiday shopping season requires some budgeting. This is especially the case if you carry high balances into the holiday season on credit cards you commonly use.

Balance transfer offers allow you to move existing balances from one or more credit cards to a new account being opened or even one of your current credit cards. Make sure to check the terms and conditions to see if there is a balance transfer fee - which could be a percentage of the amount transferred. A common example of a balance transfer offer is a 0% introductory APR for a period of time, usually 12 to 18 months. This would be a viable option to chip away at existing debt in an easier, more manageable manner. Plus, the 0% introductory APR will help save money on interest in the long run.

4. Stay secure with fraud protection

While there’s never a convenient time to fall victim to fraud, having it occur during the holiday season is not ideal. Especially on your debit card, where fraudsters can gain immediate access to your cash and drain your account.

However, with a credit card, you won't lose any funds from your bank account. You'd simply report the fraud to your credit card provider, who will investigate the charges. By law, you cannot be held responsible for more than $50 if your card is physically lost or stolen, but you can safeguard to make sure you don't get stuck paying for purchases you didn't make.

To make sure you're covered, find a credit card that offers fraud protection for unauthorized transactions. Unauthorized transactions are any charges made on your account without your approval.

Most major credit card providers offer some form of fraud protection, so long as you've demonstrated responsibility in keeping your card information safe. Some ways to protect your credit card information online include avoiding public Wi-Fi when making purchases, making sure the lock symbol is present in your web browser's address bar for the retailer, and adding your credit card to a digital wallet.

Above all, to make sure that fraud protection will alleviate you from being held responsible for the charges, you'll need to act fast. According to The Fair Credit Billing Act, suspicious charges must be reported within 60 days from receiving the billing statement. However, most credit card providers require that fraudulent charges be reported within 30 days.

5. Extended warranties can go a long way

If you're shopping for electronic devices — or anything that plugs in — it'd be wise to get some form of warranty to protect your purchase. Usually, you're presented with warranty options at checkout and while acquiring the security is a smart move — you don't always have to pay for it.

Most credit card providers offer extended warranty plans on digital items that follow the same terms offered by a manufacturer; yet, come free of charge if you make the initial purchase on your credit card. Just be sure to check your credit card's benefits beforehand to confirm that the item you plan on purchasing will be covered. If it is, then you've earned a black belt in value shopping because using your credit card's extended warranty protection plan could save you hundreds of dollars.

After you've made the purchase and confirmed that the item is eligible for coverage on your credit card's warranty plan, you'll need to secure three pieces of paperwork: the retailer's receipt for the purchase, your credit card statement that lists the purchase, and a copy of the original manufacturer's warranty.

Bonus tip: Benefit those in need

Now that you're familiar with the many advantages that credit cards offer, you may want to use some of that extra money you've saved to help those in need. You can cash out your rewards and donate the money directly to the charity of your choice.

You're made ready to save this holiday season

If you're ready to save money while securing every toy, video game and style trend on your loved one's wish list, take advantage of your card perks when you make your purchases. And you'll gain peace of mind knowing that credit cards offer high levels of security for your purchases.

Want to earn cash back on all your purchases^? Review the credit card options from Citizens to determine which card makes sense for your financial situation and goals.