Just as the time of year determines when the sun rises and sets, it also portends how much you'll spend on your credit cards. Charging, it seems, is a seasonal pastime.
Consumers accelerate their charging the most in November and December and pull back mightily in the first three months of the new year. Credit card spending then steadily rises until it hits another burst in August and then wanes for the next two months, according to a Bankrate analysis of Federal Reserve data.
Knowing when and why credit card spending increases could help consumers smooth out all that charging, so they can avoid rolling balances and low credit scores.
"Credit usage is a living, breathing thing that reacts to what is happening in the environment at a particular time," says Ezra Becker, vice president of research and consulting at credit bureau TransUnion.
Find the best credit card rates at Bankrate.com.
Dissecting credit card spending
A Bankrate analysis of Federal Reserve data since 2004 found that credit card spending increases on average by 1.09 percent in November over October and then by 2.56 percent in December over November. Those months mark the most rapid month-over-month growth in an average year.
January, February and March show the largest month-over-month declines in spending, respectively, according to the analysis. By April, consumers slowly charge more than the month before and, in August, consumers ramp up their charging by 0.76 percent, the third largest month-over-month rise in average credit card spending after November and December.
Consumers slack off in September and October before ramping up for the holidays, according to the analysis.
External forces on charging
It should come as no surprise that the uptick in charging in November and December is due to holiday spending. But what about the ups and downs that occur in the other months of the year?
"January and February are pretty much your valleys for the year, minus those folks who fall too hard for Valentine's Day," says John Ulzheimer, credit expert at Credit Sesame. "It's hard to maintain the same level of spending you did over the holidays."
Spring and early summer bring a rise in spending as people plan summer trips, buy airline tickets and spend more on dining, gas and entertainment during vacation, Ulzheimer says. Spring and summer bring celebrations as well.