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How to Handle Post Holiday Debt

In an AP story titled “6 tips to get out from under holiday debt in 2013” Alex Veiga writes “A wallet-emptying shopping binge and New Year’s debt hangover are mainstays for many consumers.”  Hopefully this is not describing you, but if it is, there are a few things you can do to take control of your debt.

Woman Holding Hand to HeadMany credit card holders are expected to have their average debt increase by about 8% to $5446 by the end of this year.  According to TransUnion, that is the highest level in four years.  With the lapse in Social Security payroll tax reduction, most paychecks will be less; you probably have already seen this in your own check.

Multiple Cards. If you have used multiple credit cards for your holiday spending spree you’ve probably already have received the first round of bills.  Here’s a quick and dirty method to getting rid of those card balances and stay motivated to move on to the others.  …Concentrate of paying off the card with the lowest balance.  I know some experts advise to pay off the higher interest rate card first, but if you concentrate on the card with the smallest balance first, it will get paid off sooner giving you the incentive to keep going.

No More Debt. To avoid adding debt, commit to using your cards as little as possible, preferably not at all.  Take the credit cards out of your wallet or purse and put them in a drawer until you pay them off.

Take Control.  You cannot take control of your finances until you promise to do it; the more you ignore the condition you are in, the worse it will get. Take a hard look at your finances, your budget (you have one right?), debts, income, and expenses, and try to understand where all of your money is going and where you can plug the leaks.

Focus on the Finish Line.  Staying motivated is key to succeeding in your quest to be debt free.  Take your first goal, pay off Master Card, write it down on a Post-It and put it everywhere.  Put one on your computer monitor, your bathroom mirror, refrigerator, linen closet, food pantry, in your underwear drawer, everywhere you can think of so you are constantly reminded of the prize.  When you accomplish that goal, set another and go after it!

Minimum Payments are for Losers.  That’s just what the credit card company wants you to do, pay the minimum.  It will take you something like 152 years to pay off $47.89 if you make the minimum payment. (I’ve told you a million times not to exaggerate). Sometimes if you have made your “minimum” payments on time they will even give you a month where your minimum payment is $0 the “Free Month”!  Oh, thank you Credit Card Company.  Do you think they are still charging you interest on your “free” month?  You bet they are.  Don’t put money in the credit card company’s pocket, stay away from the minimum payment.

Who Cares About the Jones’?  Don’t try to keep up the friends or neighbors who are buying new cars, boats or going to Disney World for 2 weeks.  Those Mickey ears and t-shirt won’t be much solace when the cupboard is bare.

Make a Plan.  The cool thing about a plan is that you get to see progress as it happens.  Just like making a big To-Do list.  Once you start checking things off the list you start to feel pretty good about yourself.  Remember, “Plan the Work and Work the Plan” and you will succeed.

Your Best Bet. Your best bet if your debt has reached that point where it is unmanageable is to contact a professional to help you out.  DebtHelper can help.

Here’s How It Works

  • An experienced credit counselor works with you to determine your monthly budget
  • DebtHelper negotiates lower monthly payments and interest rates with your creditors
  • You then make lower monthly payments on time
  • Since Your credit card interest is either eliminated or reduced, more of your payment is      applied towards principal rather than interest!
  • You’ll get a monthly statement showing how much you’re saving
  • Average monthly payments drop from $925 to $603
  • Simplify your life – Your bills are consolidated into one simple and easy monthly payment
  • Your credit stays intact and may even improve!

Debthelper.com provides service to you regardless of your circumstances. Start taking control of your credit card debt and sleep soundly tonight! Call us today at (561) 472-8000 or toll-free at (800) 920-2262.

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