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Could your holiday generosity wreck your credit score?

FICO now factors “buy now, pay later” loans into scores, increasing the risks of overspending.

Debt may be the biggest Grinch this holiday season. Nearly half of shoppers and travelers expect to go into debt, with many already carrying balances from last year. Experts warn high prices, “buy now, pay later” traps, and ignored budgets could make 2026 start in the red — and new FICO rules mean overspending could hit your credit score faster.

Holiday cheer may come with a credit hangover — nearly half of shoppers expect debt, and FICO’s new rules could make it sting.

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By: Holly Firfer , Emily Hanford-Ostmann

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As tariffs alter holiday wish lists, financial anxiety is prompting many Americans to rethink their spending plans.

“As a parent, I’ve kind of tried to lessen what I’m spending,” shopper Samantha Hunter said.

According to NerdWallet’s holiday spending report, 31% of shoppers are entering this season with credit card debt from last year.

A recent poll from the American Institute of CPAs finds 47% of holiday shoppers and travelers expect to go into debt. While many set a holiday budget, about one in four admit they probably won’t stick to it.

With prices still high, shopping expert Trae Bodge urges preparation ahead of Black Friday.

“Look back at your credit card bill from, say, January. Did you bring debt into the new year? If so, make some tweaks,” Bodge said.

The platform CouponFollow reports 45% of Americans feel pressured to spend or give more than they can comfortably afford during the holidays.

“I think people are feeling pressure from a lot of different areas, and they’re going to have to make decisions about what they want to spend their money on this year,” said Clay Cary, CouponFollow’s senior trends analyst.NerdWallet’s Sara Rathner recommends breaking the debt cycle by replacing costly gift exchanges with cheaper, more meaningful alternatives.

“If you haven’t figured out how you’re going to start that conversation, now is a good time. I promise you somebody else in your circle feels exactly the same way and will be relieved you brought it up,” Rathner said.

Ways to gift without adding debt:

Buy fewer, higher-quality items
Give homemade or DIY gifts
Swap physical gifts for shared experiences
Use coupon apps and rewards points

Experts also caution against buying too many gifts for yourself.

“Don’t get into the ‘one for them, one for me’ trap that so many of us fall into,” Bodge said.

Credit cards aren’t the only risk for holiday shoppers. Loan stacking—taking out multiple “buy now, pay later” loans—can lead to fees and interest if payments are missed.

“If you go into a buy now, pay later purchase decision thoughtfully, it can be a good thing,” Rathner said. “The issue is when you use it a lot and get in over your head.”

Earlier this year, FICO announced it will begin incorporating buy now, pay later loans into credit scores.