’Tis the season for spending, which means that most of us will hit credit cards and overdrafts. Given that the Bank of England’s Base Rate continues at one of the lowest rates ever, credit card companies and banks are netting huge profits from interest and penalty payments. That can’t be right, can it?

Many of us use credit to make ends meet but we are paying way over the odds. Time to check the small print and make some changes.

The key rule with bank overdrafts is to pre-arrange a limit, stay within that limit and follow the agreed repayment plan. Never go into un-arranged debt as this costs even more.

Most banks offer quick, easy account switching and you may even get a cash incentive for making the switch. Do your research and find out which bank account suits you best.

Credit cards are a minefield. So many whistles and bells to choose from: the duration of the interest-free period, percentage transfer fees and the interest rate on new purchases. It’s easy to balance transfer to a new provider but make sure that it’s the right card for you. Some providers offer a range of cards; do your homework and check the product offered meets your spending and repayment needs.

The golden rules of balance transfer

1. Use an ‘eligibility calculator’ to establish which companies are most likely to accept your application.

2. Never miss or under-pay a payment.

3. Don’t add any new purchases to a balance transfer card.

4. Never draw cash on a balance transfer card.

5. Repay the entire balance within the interest free period.

The price comparison sites are a good place to start and check individual websites to find the deal offering the best fit for your circumstances.