Paying Down Holiday Debt Faster

The holidays are such a festive time that sometimes it’s easy to lose track of spending. Then you get the bills. What can you do to get that debt paid down? Here are some tips on how you can start paying back holiday debts.

Face It

This can be difficult. After all, you bought the gifts and spent the money with good-hearted intentions, right? Unfortunately, numbers don’t change regardless of intentions! If you spent too much, you spent too much. Now you have to admit that and tackle the problem. Otherwise, you’ll spend the next ten months in denial and go into more debt the next holiday season.

Go on a Diet – a Financial Diet

Cutting back on calories is a popular thing to do in the New Year. It’s also a good idea to try cutting back on spending in the New Year, too. Try cutting out all unnecessary spending for at least a month. That means you only spend money on what you really need (such as groceries – and not the pricey ones, either) and on paying down your debt.

Make a New Year’s Resolution – Never Again

Getting out of debt is no good if you just get back into it year after year. Maybe you should make yourself a promise that you are never going to go into debt at holiday time again.

Start Saving

Start setting aside money for next year’s holiday spending. You can put it in an envelope or in the bank, but just make sure it’s strictly earmarked for holiday spending only. While you’re saving, you can take stock of your debt and get a good idea of the dollar amount you’ll need to save.

Plan to Reduce

Maybe you overspent because you didn’t plan ahead. To avoid that next year, your savings will help, but it will also help if you have a plan. Look at your debt for this holiday season, and consider where you could cut back for next year.

Highest Interest First

As you look at your debts, choose the one with the highest interest rate to pay off first. Double up on payments if you can. Also, call your credit card companies and see if they will reduce your interest rates. If not, then look for interest-free deals on other cards and see if you can roll your balance over.

Tell your existing credit company about this deal, and let them know you will switch if they can’t lower your interest rate. If they think they may lose you as a customer, they are often willing to negotiate.