When Festive Spending Hits Your Credit Score - What to Do Next?

Spent your holiday season in the UAE? Well, it’s surely a vibe - luxury shopping, staycations, overseas trips, brunches, Christmas, and year-end celebrations make swiping your card feel almost effortless. But once the holiday ends and the January bank statement arrives, reality hits hard. 

However, if your credit score dipped after the holidays, stop panicking!

You enjoyed the season, and now it’s time to bounce back, but SMARTLY.

What Really Happened to Your Credit Score Behind Those Holiday Swipes?

Let’s be honest. Holiday overspending is not equal to bad money habits. During the festive season, credit cards definitely work overtime. With higher card usage, maxed-out limits, and delayed payments, your Credit Score gets affected.

So, what really matters in maintaining your score? 

One of the biggest factors is credit utilisation. When your spending shoots up close to your card limit, even if you plan to pay later, it signals that you depend heavily on your card. Post-holiday cash flow stress adds up, and your score can take a temporary hit. 

Now, the question is, can you improve your ruined credit score? Let’s find out…
 

Good News: Your Credit Score Isn’t Permanent

Yes, you heard it right! Your Bad Credit Score isn’t permanent. With disciplined financial planning and consistency, you can rebuild your score quickly. 

Holiday overspending is usually a short-term issue. So correcting your score over the next few months can significantly improve your financial health.

We get it - life happens, and we can overshoot on the spend despite the best preparations. That’s why we have provided you with quick ways to boost your credit score!
 

Your Post-Holiday Credit Score Recovery Tips 

Start by bringing your Credit Card utilisation down. Always aim to use less than 30% of your total limit. If you’ve accumulated holiday bills, prioritise paying off high balances first. That said, even partial repayments help.

Next, complete your instalment payments and card dues on time. Set reminders or auto-debits to avoid missed payments. If your expenses are spread across multiple cards, consolidate payments to reduce clutter and confusion.

Avoid swiping your card impulsively. Give yourself a ‘cooling-off’ phase, only where spending is required. Always remember - prioritising your needs over your wants. This way, your credit score will surely thank you. 

Also, run a soft credit check on your credit score regularly. Errors do happen, and correcting them can give your score an instant boost.

What Not to Do When Fixing Your Credit?

While working on increasing your credit score, you may unintentionally make mistakes. 

One common mistake is applying for new credit too soon. That tempting zero-interest offer or extra card might seem helpful, but multiple applications lead to hard enquiries - eventually dragging down your score.

Another pitfall is paying only the minimum due. This increases interest and keeps utilisation high. Also, avoid closing old credit cards in a panic. Why? Because a longer credit history actually works in your favour.

Lastly, don’t ignore your credit report out of fear. Knowing where you stand is the first step to improvement.

Keep Your Credit In Check This New Year 

The holiday season means vacations, shopping, festive treats, and unforgettable memories. But as the new year begins, it’s also time to reset your financial profile. Make smarter choices, spend wisely, balance your needs and wants, and keep a close eye on your credit behaviour.