While online shopping is a convenient way to purchase the items you need and compare prices between retailers without leaving the comfort of your home, survey data indicates that it can also lead to bad shopping habits. consumption.
Nearly three-quarters (74%) of online shoppers have experienced buyer’s remorse, according to a recent study on the Slickdeals coupon search website.
The most common regret expressed was that the value of an item was less than expected for the price (39%), followed by not really using an item purchased online (34%). About a third (32%) of consumers said they regretted spending too much money when shopping online.
If you feel the need to splurge, keep reading for tips on how to curb overspending habits. Plus, learn more about how to manage your credit card debt. One strategy is credit card consolidation, which involves paying off high-interest credit card debt with a fixed-rate loan. You can read more about personal loans for debt consolidation on Credible.
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How to Adopt Healthy Spending Habits When Shopping Online
One of the most common consumer regrets is that they spend too much money when shopping online, according to the survey. If you share this feeling, check out these tips from credit reporting company, FICO, to help you stop overspending online:
- Don’t shop online when you’re in a bad mood. Get yourself in a clear frame of mind before whipping out your credit card to avoid unnecessary spending. You might also want to stay away when you’ve been drinking – around six in 10 consumers have admitted to shopping online while intoxicated, according to Slickdeals.
- Wait a day before making an online purchase. Move the item out of your cart and into a list to save it for later. If you still need the item in the next few days, think carefully if the purchase is worth it.
- Avoid Buy Now, Pay Later (BNPL). Installment finance options like BNPL can tempt you into spending too much on a purchase you can’t really afford. And if you miss a BNPL payment, it could hurt your credit score.
- Make a shopping list with spending limits. Just like at the grocery store, you should come prepared with a detailed list of the items you need, to avoid impulse buying those you don’t have. Also set a dollar limit for how much you’re willing to spend per item.
- Put some money aside for a “splurge fund”. This separate account can come from birthday money, work bonuses or other cash receipts. If you need retail therapy, you can tap into that extra cash reserve instead of relying on credit or dipping into your emergency savings.
As a bonus, you can put your rainy day fund into a high yield savings account and watch the balance grow over time with interest. You can visit Credible’s online financial market to compare savings rates from multiple banks at once.
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What to do if you’re struggling with credit card debt
Shopping online can be a gateway to overspending for consumers struggling to manage their credit card balances. If you’re having trouble keeping track of your spending behavior, learn more about common debt repayment methods in the sections below.
Consider meeting with a credit counselor
Non-profit credit counseling agencies offer free or low-cost debt management services to consumers struggling with financial planning.
A credit counselor can analyze your monthly income and expenses to help you establish a budget. In some cases, they might sign you up for a debt management plan (DMP) to pay off your creditors in fixed installments. Credit counselors may even be able to negotiate with creditors on your behalf to secure a lower interest rate or waive late fees.
You can find a licensed credit counseling agency in your area at the Department of Justice website.
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Use a credit card with balance transfer
Credit card balance transfers allow you to transfer debt from one or more accounts to a new card with a lower interest rate. Applicants with excellent credit can even qualify for a 0% APR introductory offer, effectively giving them a period of up to 18 months to pay off their debt interest-free.
However, balance transfer cards are generally reserved for borrowers with a very good credit score, defined by the FICO model like 740 or higher. Therefore, debtors with good or bad credit may not qualify. Additionally, many credit card companies charge a balance transfer fee, usually between 3% and 5% of the transferred amount.
You can visit Credible to compare balance transfer credit cards for free without affecting your credit score.
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Consolidate your credit card balances into a fixed rate loan
Credit card consolidation allows borrowers to consolidate multiple higher interest rate debts into one monthly payment with a personal loan. According to the Federal Reserve, personal loans typically offer lower rates than credit cards, which means you may be able to save money in interest charges, pay off debt faster, and lower your monthly payments. through debt consolidation.
Personal lenders determine interest rates and eligibility based on the length and amount of the loan, as well as the creditworthiness of the borrower. Applicants with good credit and a low debt-to-income ratio (DTI) will be eligible for the lowest interest rates available, while those with fair or worse credit may not be eligible at all.
Most lenders allow you to prequalify to see your estimated interest rate with a soft credit check, which won’t affect your credit score. You can prequalify with multiple lenders at once in Credible’s personal loan marketplace.
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