Soon the holiday greeting cards will be replaced by holiday bills

“Many people do not plan their holiday spending, even though it is a major annual expense,” said Jeff Schwartz, Executive Director of Consolidated Credit Counselling Services Of Canada, Inc. “As a result, these expenses often end up on credit cards that can take well into the New Year to pay off.”

If you overspent at the holidays, try these tips to reduce debt:

Stop using your credit and charge cards. Use cash when possible to pay for food, clothes, utilities, rent/mortgage and other necessities. Keep your credit card charges to a minimum until you pay off your holiday debt.

Add up your holiday charges. On a sheet of paper or with the use of a computer spreadsheet program, create columns for each credit card, the amount outstanding and the annual percentage rate. This will tell you how much money you owe.

Develop a repayment plan. Decide how much money you can devote each month to pay down your holiday debt. Look for ways to shave expenses to set aside an extra $50, $75 or $100 a month to reduce your holiday debt. You might consider reducing long-distance calls, eliminating subscriptions and eating out less often. You could also have a garage sale or get a part-time job.

Stick to your plan. Pay off the credit cards with the highest interest rates first. You might also investigate the possibility of transferring bills to credit cards with lower interest rates.

Create a plan for the upcoming holiday season. One of the major causes of holiday debt is a lack of planning. Consider opening a holiday account to save for the holidays this year. Use your previous holiday expenses as a starting point for what you will need in the upcoming holiday season. Take the time to prioritize what it most important to you and look for areas to shave costs, such as entertaining less or giving home-made gifts.

During the holidays, it’s easy to get caught up in the spirit of the season and spend beyond your means. If this happened to you, treat this as a learning experience and resolve to do better this year. If you need help, call Consolidated Credit at 1-800-656-3920 for free financial advice.

Consolidated Credit Counseling Services of Canada, Inc.’s mission is to help people end financial crisis and solve money problems through education and professional counselling. Consolidated is a non-profit agency that is committed to helping individuals and families deal with life-altering credit, debt, and financial issues.

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