The stockings are empty. The presents are opened. Christmas is over. But the time to tackle your holiday debt has just begun. Every year, many people over-spend and over-charge during this time. While all this shopping brings a good feeling of sharing joy and giving gifts, it also leaves a big bill that needs to be paid off. Never fear; taking care of the debt isn’t as hard as you may think it is. Here are some tips to help you pay off that debt quickly and easily.
1. Make Getting Debt-Free Your Top Priority
Before you go charging anything else, think about how you are just adding to your already large debt. You may have to cut you certain luxuries like your morning specialty coffee or eating out every day. While you are cutting down your Christmas debt, you can substitute these things buy brewing your own coffee at home and adding flavored creamer and packing a home lunch.
2. Change The Way You Pay
Since you are trying to cut down on your debt, it is best to completely stop using your credit cards. While you are paying off your cards, switch to a cash-only system or prepaid cards. If you don’t have the cash for it, then you can’t buy it. This will prevent you from over spending.
3. Live On One Income
If you are in a household that earns two incomes, try living on just one of them. By cutting out unnecessary expenses like cable and pricey restaurant meals, you can live on a lot less. Try to get as close to living on one income as you can, and use whatever you save to squash your debt. It will take some discipline and sacrifice, but think of what you will gain once your debt is paid off.
4. Make Extra Money
If you want to pay off your debt even faster, look for additional ways to make money. If you are crafty or a whiz in the kitchen, you can sell homemade wares or baked goods at craft fairs for a little extra money.
5. Make A List Of All The Debts You Need To Pay Off
First and foremost, you need to make a list of all your debts. Gather all your statements to get the balance due for each credit card, store card, etc. Seeing the total in black and white may shock you into seeing how much you actually spent.
6. Make A Deal On Your Interest Rate
No matter how much you owe, it’s the interest that will kill you. Each month, more and more interest gets tacked on, which makes it harder and harder to get out of debt. Call up your credit card companies and ask if they can lower your interest rate. They may not always say yes, but it can’t hurt to ask.
7. Move Your Balance Around
If you can’t lower you interest rates, transfer the balances from a higher rate card to a lower one. If you have one card that has a lower rate than the others, transfer as much of your balances as you can. You may also consider shopping around for a new card that offers zero interest for the first 6 months to a year. It will give you time to pay off your balance without having to worry about adding on additional debt due to high interest.
8. Pick One Card To Start Paying Off
When attacking your debt, you can either start by paying the account with the highest interest rate, the one with the lowest balance or the one with the highest balance. There are benefits to be had from starting with any of these. The one with the highest interest rate is just adding to your debt. Knocking that one out first can help lower your debt quickly. Paying the one with the lowest balance will give you the quickest results. This can help keep you motivated to keep chipping away at your debt. Paying the highest balance account may take a little longer, but once you are done with that debt, chances are you have paid off quite a bit of that Christmas debt. Pick the one that you think would motivate you the most and work on that one first.
9. Pay As Much As You Can
Your statement will always show the minimum due, but you should never pay this amount. Always pay more than that. In fact, pay as much as you can afford to. Take all that money you saved from eating in and cutting out the gourmet coffee drinks, and use it to pay off that first card you chose.
10. Keep On Going
Once you have paid off your first credit card, you can rejoice! Then continue on. Take all the money that you were putting toward that first card, and roll it over to the next one. Rolling over your money each time you wipe out a debt will get your balances done quickly and you will be debt free before you know it.
Christmas time can bring on a lot of extra debt. Once the spirit and joy of the holiday season is over, that debt must be paid. Follow these tips to pay off your Christmas debt easily and quickly so you can soon be debt free.