Tips for Paying off Christmas Debt

The holiday season is a time of celebrating and gift giving. For most, it’s a joyous time without thinking of the amount of money that you’re spending. As January rolls around and the bills start coming in, it might be a shock to see what you spent the last few months. You don’t want to be spending the next year paying off debt from a couple of months. Here are some tips to clean up that debt quickly.

Snowball Effect

This is a common practice for paying off your credit card debt. You want to focus on the card that has the highest interest rate and make the highest payment you can on that one each month, while paying just the minimum payment on the others. This practice will pay off that large interest credit card quickly (keeping you from paying more on the interest that accrues). After that one is paid off move on to the next one, paying the same amount plus the minimum payment you were paying. In no time at all, you will have your credit cards paid off.

Strip Down your Budget

You need to take a careful look at what you are spending your money on and see where you can make changes. Depending on what type of debt you owe, this could mean eating at home for a few months or staying away from the mall. It could also mean cutting back to the bare bones on the luxuries of life like cable, manicures and pedicures, and expensive hair appointments. It doesn’t have to be things to eliminate forever, but until you get your debt under control. You might realize you can live without these things, and end up saving even more money in the long run.

Selling Anything and Everything

January is a great time to clean out closets and the clutter that you don’t use. There are many websites that can help you sell the things you don’t want and make a little cash that can help with paying off debt. Not only will you feel great about getting clutter out of your house, but you will also enjoy the extra money that helps to alleviate your debt.

There are many things to do to help you pay off accumulated debt from the holidays. Once you have the debt paid off, the goal is to have more self control this year and start to save for the holidays. Contact Carolina Money Minders for more help with debt.