The presents have been opened. The guests have gone home. It’s time to take down the decorations and put away the eggnog. The holidays have officially come to a close. Life is returning back to normal and as you come down from your seasonal high, you’re probably thinking of mostly warm, happy thoughts. That is, until you open up your credit card statement and get yanked back into reality.
It happens to the best of us – overspending during the holidays is all too common. Despite your best intentions, you may have racked up some holiday debt too. As those bills roll in, you may be shocked by how much you charged on your credit card.
It can feel a bit depressing, but don’t let it get you down. When you apply these 5 strategies, you can pay down your holiday debt relatively quickly.
1. Assess the damage.
First, make a list of all of your expenditures that were paid with a credit card or loan, and figure out how much you owe. If you can, try to pay everything off at once. However, if that isn’t doable, prioritize your debts according to interest rate. If your goal is to save more money, start by paying off your higher-interest balances first and then work on the others. Meanwhile, make sure you are still making the minimum payments (at least) on all of your other accounts.
2. Take a break from using your credit cards.
No matter what, don’t add any additional debt. Take a break from using your credit cards by going on an all-cash diet. For the next few months, put yourself on a bare-bones budget and cut out any expenses that aren’t absolutely essential. Then, use the rest of the money to pay down your debt. You’ll need to make some long-term changes to your spending habits if you want to get out of debt for good.
3. Use your holiday money or bonus.
If you’re lucky enough to get a holiday bonus or received some extra cash this season, consider using it to pay down a chunk of your debt. The more you put towards your balances, the faster you’ll pay them off and the less you’ll pay in interest. Start the year off right by working towards improving your financial situation.
4. Return or sell unused/unwanted items.
Got some things you didn’t want this year? Or maybe you’re having buyer’s remorse for some of the After-Christmas purchases you made. Don’t clutter up your space with stuff you don’t want or need. Either sell it or take it back to the store for a refund. You can use the cash from those items to pay down debt as well.
5. Get help if you need it.
If you racked up a little bit of debt over the holidays, chances are you can probably handle it on your own. However, if you have more than $10,000 in unsecured debt, are struggling to make your payments, or just aren’t sure where to start, it may be beneficial for you to work with a reputable debt relief company. In fact, it may be just the thing you need in order to succeed.
As you go through the debt reduction process, make sure to track your progress so that you always know where you stand. When you see the strides you’re making, it will motivate you to keep on going. Paying off debt isn’t easy, but with some work, the necessary tools, and the right partner by your side, it is possible. Apply these 5 strategies today, and your holiday debt will be gone in no time!