Smart Strategies for Managing Holiday Debt | CreditRepair.com

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The holiday season is so much fun! Until it’s all over and you’re looking at your credit card bill.

Yikes.

Back to earth with a bump, and a hefty dose of the reality of the number of times you bought something just ‘cause you felt a bit festive.

It’s ok though, as there are some simple steps that you can take to get back on track.

 

1. Get Your Finances Organized

When it comes to sorting out your holiday debt, it’s best to try and get it as organized as possible.

Look at your credit card statements and add up all of the debt that you have. It may not sound like the most fun task ever, but you will know where you stand.

The last thing that you want to happen is to ignore it and let the interest pile up.

 

2. Start a Simple Budget

When it comes to paying off your debt, you’re going to want to know how much spare cash you have to throw at it.

The best way to find out how much money you have to pay off debt with is to start with making a simple budget.

List your income, and then all of your expenses. You can get your regular payment amounts from your internet banking or bank statements, and write down your daily spending to see where your money is really going.

It’s important to track your spending because then you can create realistic budgeting categories.

The point of a budget is to show you where to put your money, so you need to make sure you’ve split it off correctly.

Now you’ve written down all of your expenses, all that you need to do is minus that from your expenses, and you can see how much left you can put towards your debt.

 

3. Use the Snowball Method

The snowball method of paying off debt is where you list our your debts in order of the smallest balance to largest balance.

This method doesn’t look at the amount of interest on each debt but instead focuses on the psychological aspects of paying it off.

What this means is, if you are staring at a mountain of debt to pay off, it can be very overwhelming. An easy way to get a quick win is to pay off one of your smaller debts.

This is beneficial psychologically because you will see instant progress and it will make you feel good.

Don’t underestimate the importance of motivation on the journey of paying off debt!

 

4. Increase Your Income with a Side Hustle

After you’ve done your budget, you may find that you don’t have as much spare income as you would like to pay off your debt.

There is no limit to the income that you can earn, which is great! And what is even better, is that we live in an age where it’s easy to find an extra job on the side.

Some simple things that you can do from home include:

• Freelance writing
• Answering surveys
• Market research
• Pet sitting
• Blogging
• Flipping items to sell

If you can venture out of the home (easier when you don’t have kids!), there are other side hustles that you could try out as well, such as:

• Delivery jobs e.g. Uber Eats, DoorDash
• Lyft or Uber driver
• Part-time retail job
• Dog walking
• Photography

Earning extra money with a side hustle will help you to pay down that debt so much faster.

 

5. Check Your Credit Card Statements

Take some time to go through your credit card statements so that you can get a clear overview of everything.

Are there any charges on there that you don’t recognize? Be sure to dispute any that don’t look like you.

Also, check to see if you have any recurring expenses that you can cancel or reduce.

This can also help you find money that you didn’t know you had, and you can use this towards your debt.

It’s always wise to try and avoid holiday debt if you can, but if you overspent, it’s ok – follow these tips and you will get back on track.