- Review your holiday spending. Make a list of everything you bought. Add up your totals to know exactly what was spent.
- Make a plan to pay back your debt. Total up all your monthly expenses, calculate your income and make a budget. Make sure your income exceeds your expenses. Cut spending where possible and avoid shopping when possible.
- Don’t use your credit cards. You don’t want to create more debt for yourself. It may help if you determine if what you want to buy is a want or a need.
- Carry cash instead of credit cards. Studies show people spend more when paying with credit cards.
- Make extra payments when it’s possible. Paying your debt off helps you regain financial stability.
- Contact your creditors. Ask if they can reduce interest rates or provide a new payment schedule. Let them know your challenges and you’ll remain a loyal customer.
- Look at your interest rates. Pay accounts with higher interest rates off first. (But, don’t stop paying on other cards.) Consider transferring balances from high-interest rate cards to a low-interest rate card.
- Search your house to see if there is anything you don’t use anymore or gifts that are unwanted. You can sell or return the item(s) and use the money to pay off your debt. If the item was purchased with your credit card, return it to make your balance lower.
- Cut expenses. For instance, don’t go for your daily coffee run, use coupons when possible or brown bag your lunch.
- Speak with a credit counselor. He or she can teach you how to save your money and help negotiate with creditors.
- Create a new budget for this year. Try to save for this year’s holiday spending early to eliminate debt next year. You may even consider opening a holiday savings account.
Paying off holiday debt can be stressful and ruin your new year. Start early with a plan specialized for you and what you can handle. If you’d like professional help, visit BBB.org or call 937-222-5825 or 800-776-5301 for a list of BBB accredited credit counseling agencies and business profiles on ones you’re considering.
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