Yahoo Finance Overspent During the Holidays? 10 Steps To Recover in 2024
If you went all out this holiday season, you might be feeling the weight of new debt. The mere thought of looking at your bank account or credit card statement could incite panic.
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“With the hustle and bustle of the holidays, many of us get wrapped up in wanting to give the perfect gift, no matter the cost,” said Mindy Oglesby, CFP, founding partner and CEO of Oglesby Wealth Strategies in Watkinsville, Georgia. “Perhaps you are like others of us, who have procrastinated, and at the moment, the cost doesn’t matter as long as we have a gift to give to that friend or family member.”
Here’s some advice to help you pay off your holiday debt.
Assess the Debt You Accumulated
“Whether you receive your credit card statements electronically or through the mail, collecting them all in one place is a great way to start seeing how much you have overspent,” Oglesby said. “If you don’t know what debt you have, you can’t accurately plan.”
She said this is a great first step to regain control of your financial destiny.
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Accept What You Spent
“Don’t beat yourself up in the aftermath of the holiday craze,” she said. “Remember to be kind to yourself for the expense incurred, whether the awesome gifts in this gift-giving season were to friends and family, or even to yourself.”
The spending is now in the past, so Oglesby said it’s time to move forward.
“Continue to focus on coming up with a strategic plan to get rid of those financial obligations that weigh you down,” she said. “Accepting an open mindset of what has happened and adopting a new way of change will transform you into living this next year, and hopefully the rest of your life, with purpose and prosperity.”
Create Practical Goals To Pay Off Your Debt
Becoming debt-free won’t happen overnight, but you have to start somewhere.
“Apply practical goals for yourself to pay it down,” she said. “Making a spreadsheet or writing out what you collected for each credit card, including any fees and interest, will help you visualize how to tackle it and overcome getting rid of it.”
She said this can make it feel less intimidating.
“Similar to when you have a pile of laundry to fold and put away, by separating it into more manageable and specific piles, it allows you to see what stacks won’t take you as long to finish,” she said. “Paying off the smaller amounts may just be the momentum you need to keep powering through the larger amounts you owe.”
Keep an Eye on Your Budget
“Another thing that you may find helpful is writing out your budget and taping it to your fridge or bathroom mirror,” Oglesby said. “Keeping it visible will be a constant reminder of what you are aiming for.”
She said this can also serve as a source of encouragement, helping you see where you came from and where you’re headed.
Adjust Your Behavior
While working hard to pay off this year’s holiday debt, Oglesby said to adjust your spending to make sure you don’t get in the same predicament next year.
“This will lower your anxiety level during the next holiday season, and may even be a great source of peace for you to thoroughly enjoy,” she said. “Redirecting your time and energy into creating a plan to get you back on track will help you bounce back from the financial damage.”
For example, she said you might choose to cook at home during the holidays next year, instead of eating out several nights per week. Or, if you do order takeout, pick it up from the restaurant instead of opting for delivery.
“All of those amounts of savings, no matter how minuscule it may seem, adds up,” she said. “Being intentional in this process will pay off huge dividends not just for you financially, but your mental health will thank you too.”
Celebrate Your Successes
“Give yourself a high five in all the accomplishments you produce in getting out of debt,” Oglesby said. “By allowing yourself to celebrate even the smallest wins, you’ll find the incentive to maintain.”
She said to find ways to experience joy during the process too.
“Have a burn party, if even with yourself, burning the monthly credit card statement,” she said. “This is one example that will give you a sense of freedom.”
She said persistence pays, off so commit to paying off debt and keep believing in yourself.
Go Undercover
“Ever notice how if you even mention getting new shoes out loud, you are suddenly bombarded by very specific shoe ads on social media?” asked Mathilda Lambert, vice president of community and business development at Chase Bank.
She said behavioral targeting is designed to nudge you toward making a purchase.
“To help avoid these ads, disable your cookie settings to surf the web anonymously,” she said. “Additionally, if you use smart speakers, keep in mind that while they may be convenient, they can also be fueling marketing engines that serve you enticing ads.”
She said you can turn off their microphone when not in use to receive fewer targeted ads.
Pay With Cash
“Avoid using credit cards if you don’t have the cash to pay them off in full at the end of the month,” Lambert said.
She said to keep one credit card on hand for emergency use only.
“Then remove the others from your wallet so you won’t be tempted to use them,” she said. “Avoid closing the accounts as that could negatively impact your credit score.”
Check Your Balances
Lambert also notes that staying on top of your financial situation can help you resist the urge to spend.
“Check your bank accounts often for a reality check on how any impulse spending may have impacted you,” she said. “Also, set account notifications that will inform you when your balance has dropped below a specific threshold.”
Set Limits
Paying off holiday debt doesn’t mean you have to completely deprive yourself, Lambert said.
“Simply practicing moderation can allow you to make progress towards conquering your impulses,” she said.
Lambert said to give yourself a designated amount of cash or a reloadable gift card to use for non-essential purchases.
“Spend the money any way you choose, just know that when it’s spent, you have to wait until the next pay period to reload,” she said. “Decline offers to go window shopping and instead see a movie, go for a hike or have a friend over for dinner.”
She said this will allow you to socialize, without experiencing any guilt or temptation to overspend.
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This article originally appeared on GOBankingRates.com: Overspent During the Holidays? 10 Steps To Recover in 2024
