On average shoppers spent approximately $1,007 this holiday season. The retail trade association expected shoppers to spend between $717.5 billion and $720.9 in November and December, which is up over 4 percent from 2017’s total of $687.87 billion. While shopping for the holidays can be exciting, the post-holiday period can be stressful. If you ended up overspending this holiday, we have some tips to help you get out of debt – FAST.
Review your financial situation.
You cannot eliminate debt without having a clear picture of where you stand financially. Make sure you compile all receipts and documents related to your holiday expenditures. Aside from the gifts, do not forget to include food and costs related to holiday entertaining. Many people who end up with high credit card bills at the end of the holiday season say they never planned on spending as much as they did. If you do not plan your expenses ahead of time, it can be easy to end up purchasing way more than you originally intended. Planning can go a long way in lowering your holiday spending costs.
Come up with a plan.
Write down all your debt amounts along with the interest rates. Focus on the higher-interest rate debts first and consider paying more than the minimum to eliminate the debt faster. We offer some important tips for eliminating credit card debt. Some utilize the snowball method whereby they focus all their efforts in paying a higher interest card down, focusing on one card at a time. Another method is through the “island” approach where the consumer has two credit cards: one which is paid in full every month and the other card, which is a promotional no-interest or low-interest rate for big purchases, allowing the person to finance those large purchases over time.
Sell what you do not need.
With all the sales going on over the holidays, it can be easy to over buy. Most of these items either end up in the garage or saved for next year. Check through your closets and look for those unnecessary gifts and items you bought during the holiday that you can sell. Also, consignment is a great way to get some extra cash post-holiday. Everything from clothes you no longer wear, to baby toys, baby clothes and accessories- many of these stores are eager to give you cash for the same.
Pay More than the Minimum.
Consumers traditionally take approximately four months or more to pay off debt incurred during the holiday season. Many times, they are only able to make minimum monthly payments, which can prolong their ability to pay off the debt in full. Minimum payments often result in the person only paying the interest incurred that month, and if the cardholder is spending on top of the balance already owed, the debt can balloon quickly.
Credit card debt is a major problem for many Americans. The ability to conveniently shop and pay the balance later has led to many people living in a cycle of debt, especially after spending over the holidays. The credit card system is designed for consumers to lose.
Credit card debt is one of the most common problems facing those with serious financial issues. With skyrocketing interest rates, unreasonable fees, harassing debt collection calls, penalties and never-ending minimum payments that do not even make a dent in your actual debt, the people we work with frequently point to credit card debt as among their most troubling financial issues.
At Kingcade Garcia McMaken, the number one piece of advice we give to our clients, family members and friends when dealing with creditors is to be honest. If you are unable to afford payment- tell them that, never make a promise to pay and never give a creditor your bank account number or credit card information.
If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.