AUGUSTA — David Leach, a consumer credit protection expert, wants people to enjoy Black Friday and Christmas shopping this season, but he’s urging Mainers to track what they spend like a banker.

And, he adds, watch how much you spend with credit cards. Use cash instead of credit; people who buy with cash spend less.

His office hears from too many people in January suffering from an inability to pay their credit card bills.

“Avoid impulse buying, just like a good economist does,” Leach said. Before shopping, make a budget showing what you can afford to spend. Using that budget, make a list — and stick to that list.

Christmas is an easy time to get carried away and charge more than you can pay back.

“Credit cards are a high-interest loan,” Leach said. “The biggest pitfall of Christmas shopping is the size of the credit card balances in January.”

The typical amount of debt that credit card holders who don’t pay monthly balances off is about $5,000 per person, Leach said.

That’s a lot, he said, considering interest rates range from 13 percent to 18 percent, compared to a typical car loan of 4.4 percent.

When someone has a $2,500 credit card balance and only pays the minimum, at 18 percent interest it would take about 106 months of $100 payments to pay off the debt.

“And not only do you have to pay the $2,500, you would also pay $1,374 in interest on what you charged in the first place,” Leach said.

He wishes there could be a saying chiseled in granite for anyone with a credit card: “Pay your balance in full every month or don’t use the card.”

If you don’t have the cash, don’t get that gift.

When buying for adults, “skip the silly gifts,” he recommends. Find out what they need or want. “Have a plan.”

Leach doesn’t recommend walking around with a lot of cash. But paying with cash instead of plastic is a good way to stay within your budget.

Statistics show that when people buy with cash, they spend 20 percent less than they do when using a credit card, Leach said.

“When you feel the actual cash leaving your hands, whether you’re buying a sweater or eating out, it’s real,” he said.

Using cash or debit cards, as long as you manage your checking account well, are good ways to spend less, Leach said.

Credit cards do come with more protection, including fraud. Leach recommends using credit cards for secure, online purchases.

Debit cards come with less protection, but the advantage is that debit cards are like cash in that the money is spent right away, so charges don’t add up with interest.

Banks and credit unions offer consumer protections and limited liabilities against debit card fraud, as long as the fraud is reported quickly, Leach said.

He recommends consumers ask their banks or credit companies what kind of protections they provide against debit card fraud.

bwashuk@sunjournal.com

David Leach, with the Maine Bureau of Consumer Credit Protection, says shoppers ought to be careful with gift buying. His office hears from too many Mainers in January suffering from credit card bills they cannot pay. (Sun Journal file photo)

“Credit cards are a high interest loan. The biggest pitfall of Christmas shopping is the size of the credit card balances in January.” — David Leach, Maine Bureau of Consumer Credit Protection