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Shoppers Promised, But Couldn't Keep Away from Plastic

NEW YORK (TheStreet) -- With the best of intentions, consumers promised they would cut back on their reliance on credit cards to get through the holidays.

But those good intentions went awry, and higher credit card use in the last six weeks of 2013 have some consumers buried in debt.

This isn't exactly a new problem. Transunion was already reporting last month that Americans tend to have 40% more on their credit card bill from December than in the average month, and 20% have December credit card bills that are twice the normal amount they see the rest of the year.

That trend has continued into this year.

Saveup.com, a San Francisco online financial rewards service, says in its January U.S. Consumer Savings and Debt Report that almost 70% of Americans promised themselves they would use cash for their holiday spending.

But consumers whipped out the plastic just the same, and left themselves with $363 more in credit card debt this month than a year ago at this time. Americans did a much better job of saving for the holidays in 2012, when they withdrew about $700 from savings accounts and $1,000 from money market accounts to use for holiday spending.

A year later, consumers couldn't match their savings success.

"As the banking industry continues to rebound from 2009 and debt becomes more accessible, Americans are falling back into old habits," says Priya Haji, CEO of SaveUp. "Ultimately, consumers leveraged debt for holiday purchasing more so in 2013 than in 2012 despite plans to do otherwise. These habits will need to be broken in order to avoid the constant threat of financial ebb and flow."

If you find yourself struggling with more credit card debt, nip the problem in the bid quickly:

Don't pay just the minimum owed on your credit card bill. Studies show that creditors love consumers who pay the full amount on your credit card. Plus, by paying more than the minimum allowed, you'll make the debt disappear more quickly.

Give up dinners out. It's January, and it's the best month of the year to hunker down, build a fire and watch television or read a book instead of going out and blowing $50 or $100 on a night out on the town. Stay in and use that money to play "catch up" on your credit card bill.

Holiday bonus? Pay down debt. There's no rule that says you have to take a raise or a year-end bonus and spend it right away. Instead, use the extra cash to pay off credit card debt. With the average card interest rate at around 15%, you're saving $15 on every $100 owed on your credit card bill by paying it off entirely.

Maybe U.S. credit card consumers will do a better job on their spending next holiday season. To make sure, make a copy of your January credit card bill, and keep it in a handy, but safe place until next November.

Then take a good long look at it before you decide to finance your holiday spending using plastic.

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