Your Holiday Debt Plan

Our Holiday Debt Plan Can Have you Debt Free in Three Months

Is the road to financial ruin paved with good intentions? Household debt continues to climb, and the holiday season has stacked on another layer of expenses for Canadians.

Jeff Schwartz, executive director of Consolidated Credit Counseling Services of Canada, is encouraged by the financial planning but worries it will not translate into action.

Just like any other New Year’s resolution, if you don’t make a concrete plan and stick to it, it’s not going to happen,” says Schwartz.  “You need to think about real dates and real dollars and get this plan going.”

holiday debt

For example, Schwartz points to the financial worry on most peoples’ minds these days: holiday debt.

Let’s make a plan to attack the debt from the holidays,” says Schwartz.  “It’s fresh in our minds, and paying it down will build momentum for us to accomplish our other financial goals for 2020.”

To start 2021 off on the right financial foot, Schwartz and the team at Consolidated Credit took the average anticipated holiday spending amount — about $1,600 according to BMO – and came up with a plan to pay it all off:

Real Dollars, a Real Date

Consolidated Credit recommends paying down holiday debt within the first quarter of the New Year.  To pay down $1,600, you need to find an extra $533.33 per month for the next three months.

Cash-only Diet

Don’t let your credit card debt grow – it’s not easy to hit a moving target.  Join all the New Years’ dieters in 2020 and limit yourself to cash only.  If you don’t have the cash, you can’t buy the item.


Statistics Canada says the average Canadian spends seven per cent of their total income on recreation, alcohol, and tobacco.  Based on the median income in Canada, that’s roughly $450 per month.  Chances are, you had enough fun over the holidays – hibernate and save.

Frugal grocery shopping

Statistics Canada also says we spend an average of 10 per cent of our total income on food or roughly $765 per month.  Food is a basic necessity, but treating yourself is not.  Buy generic goods, plan your meals, pack your lunches, brew your own coffee, and comparison shop with apps such as Flipp.  Shaving 15-20 per cent off your grocery spending is well within your reach.

Forget Wants

The clothes and gadgets you received from Santa should be enough to satisfy for the next three months, if not longer.  Impose a moratorium on wants and only buy what you need.

Keep up the momentum

Making these budget cuts will easily save you enough money to pay down holiday debt by April.  But don’t stop there – use the payments you were making against your holiday debt to advance other financial goals like existing debt and retirement savings.

Related to: Your Holiday Debt Plan



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