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Should I pay cash?

Yes! Paying cash is great because it forces you to stay within your budget, and you won’t have the “debt hangover” in January that so many of us face when we overspend during the holidays. Some stores may also give you a discount if you pay in cash, since they won't get "hit" with the fee from the credit card company.

Many people use the holidays as a time to build up their credit card rewards. But be careful. You can float purchases on a credit card with rewards such as airline miles, but you should make sure to pay it off with the cash on hand before interest is assessed. This gives you both the rewards on the credit card, as well as interest on the cash in the bank for another month.