The holiday season is probably the best season of the year for everyone. No other reason than the joy and celebration across home and streets. However, it’s also the time when many of us slip into debt, because of everything we have to buy to enjoy the season. It’s very easy to overspend and go way above your budget, and when the holiday is over, reality dawns on you and you start thinking of how to tackle such debt. If you accrued some debt during the holiday season, and are wondering how to go about tackling these debts, you’re in the right place. In this blog, we will look at ways to tackle high-interest and overwhelming debts you have accrued during the holiday or before then. Let’s get started.

Understanding the Peculiarity of Holiday Debt

It’s not like one debt differs from the other unless one is secured and the other is an unsecured debt. However, there’s something peculiar about debt accrued over the holidays. You’re in high spirits, and likely overcompensate yourself for your hard work throughout the year. You could have found yourself spending emotionally on gifts, travel and the festivities within a very short time. It may not come as a result of you compensating yourself, it could be just wanting to keep up with societal expectations and do what everyone else is doing. You could have been disciplined with your money from the beginning of the year, and you end up throwing caution into the wind during the holidays. You’ve not done anything bad, it’s probably okay to indulge yourself sometimes. Now it’s time to tackle those debts, let’s move on to the next segment.

Assessing Your Debt

You don’t go to a battle without first understanding the strength of your enemy, this would help in your level of preparation. You can’t tackle your debt head-on without knowing where you stand. Many people may want to run away from this step because they don’t want to be shocked by the reality of how much they went overboard with the holiday spending. But, to tackle holiday spending, you need to know exactly how much you owe and to whom. Now, list out all your debts, whether it’s credit card balances, personal loans, or any other forms of debt you may have incurred during the holiday season.

For each debt, note the principal, the interest rate, the minimum payment required, and the deadline for payments. When you have a full understanding of the real picture of the debt level, it will help you equip yourself and know how to tackle the debts accordingly. Let’s take, for instance, high-interest debts can grow fast, so they need priority. Understanding where you stand will give you control and you can start to devise a means to repay the debt.

Creating a Repayment Plan

Now that you understand your debt, it’s time to create a plan to pay it off. There’s no one-size-fits-all when it comes to debt repayment. First, circumstances are not the same, and second, what worked for Mr. A may not work for Mr. Z. So, the ideal key to creating a debt repayment plan is to set a realistic and sustainable plan. It could start with identifying which debt to prioritise first, especially high-interest debts. You may choose to start by paying off the ones with a lower balance. Anyone that works for you is a good plan. What’s more important is to keep moving forward in repaying your debt without accruing more debt while at it.

Your next step is to set up a budget. Look at your monthly income and expenses, and figure out how much you can realistically put towards debt repayment each month. Don’t exaggerate your capacity. It’s important to be honest with yourself during this process. Overcommitting can lead to more stress and failure to keep up in the long run.

Reduce Expenses

You can’t continue to indulge in some activities that make you spend more. Maybe you can, but if you choose not to, it can help you have extra money to put towards debt repayment, and then you will become free of debt faster. Look at your current spending habits and look for ways to cut back.

Another strategy is to find ways to reduce your fixed expenses. You can also consider ways to increase your income. This could be taking on extra hours at work, finding a part-time job, or selling items you no longer need. The extra income can speed up your debt repayment process.

Get Rid of Debt Now!

What if you don’t have to pay your debt in full? Would you be happy if you knew you could reduce your debt by up to 80%, and interest stops right away? This can be your reality to quickly get over the holiday debt or other debt you accrued before then. You can speak with one of our debt experts at EmpireOne Credit to get tailored advice. We offer friendly, confidential, and non-judgemental service. Call us at (416) 900-2324 to schedule a free consultation with us. Being debt-free feels good!