How to Tackle Holiday Debt Before it Gets WorseDec 12, 2017
Are you worried that you’ll spend too much this holiday season? Or, are you resigned to the fact that you’ll probably be adding to your debt in December?
According to a 2016 CIBC Poll, half of Canadians expected to go over budget during the 2017 holiday season. If you’re fairly certain that you’ll be adding to your debt this holiday season (maybe you already have), here’s some advice that can help.
Use honesty as motivation to avoid debt
Debt can be hard to look in the eye. Try to be honest with yourself about your debt. Ignoring financial problems can end up causing even more stress and anxiety.
- Can you repay your holiday debt in January or will you carry that debt for months?
- How much interest will you be paying on credit card debt that you accumulated in December?
You can also find motivation from reading about others’ experiences with debt. Personal finance blogger Krystal Yee, from Give Me Back My Five Bucks, chronicles her financial challenges openly and honestly. She suggests using the fear and frustration from debt to motivate you to avoid debt in the future.
Brush up on your financial literacy
When it comes to making decisions about your finances, the more you know the better. Having the knowledge to make financial decisions for yourself means you have more control over your money. Start by checking out these personal finance experts. Both offer common sense advice about money and debt management.
Rubina Ahmed-Haq’s blog discusses the need for financial literacy. The more you know, the more you’ll be able to grow your savings and avoid debt in the future.
This TEDx talk by Preet Banerjee is a real eye opener. Reframing how you think about consumer debt can help you revise your spending habits.
Tackle your debt head-on
Avoiding your debt payments will make your debt worse. Only making minimum payments, or not tackling debt strategically, can cost you a lot in interest.
Here are some ideas about how to reduce your holiday debt sooner, and how to choose a strategy that works for you. You may want to work with a professional to get a clear picture of your situation. Reworking your budget, debt consolidation or credit counselling may be an option for you. Or a formal solution like a consumer proposal might be more appropriate.
It’s true, holiday debt can be overwhelming. Before you get in too deep this season, it’s a good idea to face your debt now, before you’re faced with even more debt in January.