How to avoid Black Friday credit blunders

Black Friday can certainly net shoppers some great holiday gift deals. But if you're not careful, experts say those "deals" could wind up costing you big in the long run by damaging your credit score.

Steve Schwartz, executive vice president of consumer services at Intersections, Inc., in Chantilly, Virginia, told WalletPop that it's easy to get caught up in the adrenaline-filled rush of Black Friday shopping. "But without a plan," Schwartz says, "consumers frequently end up with buyer's remorse." And a plunging credit score, too.

To keep Black Friday shopping from giving your score a black eye, experts say consumers need to remember a few tips.

Know your limits

Before pouring over sale ads, experts suggest scanning your credit card statements. Make note of your interest rates, available credit limit and payment cycle to avoid paying over-the-limit and more interest than necessary.

"If you're putting Black Friday on a credit card," says Schwartz, "this review reminds you of what cards you should shop with and which ones [with high interest rates] you should leave at home."

Lighten your load

Once you've identified the cards with the lowest interest rates, financial advisor and author of Deceptive Money Bob Brooks advises carry just one or two of those credit cards on Black Friday. That will reduce the chances you'll exceed your budget.

It will also cut down on the chances your identity will be stolen (if your wallet is lifted).

Check your list

It's kept Santa on track for decades, and Schwartz says making a list - and checking it twice - will help keep Black Friday from striking a blow on your score. "Without a plan or list, shoppers are more likely to blow budgets on impulse purchases," he says.

A detailed list can prevent you from giving yourself an inflated credit card bill as a New Year's present.

Keep an eye on your bottom line

Brooks says just because you have the available credit, that doesn't mean you have to spend every last cent of it. "Maxing out credit cards can hurt your credit score," he explains, "because it increases your credit-to-debt ratio." It also ups the amount you're going to have to pay off in 2010.

To combat maxing out your cards, seasoned Black Friday shopper Diana Crabb has a fail-safe system. "I stick a post-it note with my current balance and limit on my credit cards before heading out the door," she told WalletPop in a recent interview. "That way I can keep a mental note of how close I'm getting to my balance. I always come home spending less than I expected to since I'm constantly reminded of where my credit limit stands."

Ignore instant savings

Instant at-the-register savings are tempting. But Schwartz says the immediate 10% to 15% discount offered on Black Friday's purchases if you open a new store credit card can quickly turn into paying 10% to 20% more than if you paid by cash or with an existing credit card. "In addition to the risk of racking up debt on a high-interest card that you probably won't pay off with the first bill," says Schwartz, "opening a new card can lower your credit score."

Save receipts.

Schwartz advises shoppers to save all Black Friday paperwork, receipts and statements to compare them against your credit report, bank statement and credit card statements after the holidays. "In case there's an error," he offers, "you'll be able to spot it early and keep it from costing you too many credit score points."

Gina Roberts-Grey is a freelance writer specializing in consumer issues.