Education is Essential

Holiday Spending Options

Holiday Spending Options, essential federal credit union

Worried about how you’re going to pay for all those holiday purchases as you try to track down the best gifts at the perfect price? Well, you’re not alone. Many people struggle to pay for the mounting costs of gifts for the holidays.

If you’re thinking about borrowing money to pay for holiday purchases, which is the best choice—a credit card or a personal loan?


  • Interest rate is fixed
  • Rate is usually lower than credit cards
  • Loan term and payment amount are set in advance
  • Payments include principal and interest
  • You receive funds in one lump sum
  • Some loans offer a grace period before payments begin


  • Interest rate varies based on your balance
  • Rate can be higher than a personal loan
  • Minimum payment varies based on your balance
  • Minimum payments go mostly to interest, not principal
  • You determine the amount borrowed, up to your credit limit
  • Some cards come with cash or travel rewards
  • May offer a 30 grace period before interest begins to accrue 

If you can’t pay off your credit card balance each month, then a personal loan might be a better choice for you.