The rate of late payments on credit card bills is expected to rise for the rest of the year, according to preliminary index readings from Fitch Ratings.
The company said credit card payments more than 60 days past due will end six straight months of declines in October, a seasonal trend it saw last year as well. The rate that consumers pay off their balances is expected to fall, too, after reaching an all-time high in September.
However, Fitch expects the percentage of accounts written off as uncollectible to decline for the sixth month in a row.
Store credit card performance also is expected to slip. The 60-day delinquency rate is estimated to increase for the fourth consecutive month, signaling a rise in charge-offs for the rest of the year. However, charge-offs likely will decline slightly in October from September.
The pace that consumers pay off their store credit card debt is anticipated to rise slightly in September.
To keep your credit card debt in check this holiday season, make sure to budget every holiday expense including presents, decorations, food and attire for parties.
If you sign up for a store credit card to get that 10 percent to 20 percent off, pay off the entire balance at the end of the month. If you don't, the interest charges will erase any savings you get for opening the card account.
How do you handle your credit card debt during the holidays?
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