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How to get Back on Financial Track after the Holidays

Now that the holidays have come to an end you may have realized how much money youق€™ve actually ended up spending. It likely is an amount that you canق€™t actually afford. Itق€™s all too common for the after-holiday panic to set in as credit cards become a mess, and bills begin piling up as you watch your bank account plunge. However, before you throw in the towel and simply determine that your finances are permanently damaged from the holiday season, there are a few things you can do to get back on track after the holidays in order to get your finances back to health.

Create a New Budgetآ

Creating a post-holiday budget can help get your finances in order, especially if you start tracking your spending habits along with it. After all of the money that you spent on the holidays, a strict budget can be just what you need in order to get things back to normal. Ensure that you stick to it in order to have the most success. Additionally, whenever you see an item, think hard about whether or not you actually need that item, as chances are you would be better off if you simply put it down and forgot about it until youق€™re in better financial health.

Face the Realityآ

Keep in mind that the best time to act is right now. If you simply ignore the bills that are piling up, you will only find yourself in an even deeper financial mess. Itق€™s a good idea to call your credit card companies, as well as your service providers in order to see if you can negotiate any reduced fees or even reduced interest rates. Utilize whatever negotiation strategy you must to convince them to lower your fees.

Transfer Your Debt

One strategy of paying off your bills without sky-high interest rates is to transfer all of your debt to a 0% interest credit card, in order to only have to make one simple payment in order to pay down your debt. If you use this strategy, ensure that you put away or destroy any of your old credit cards so that youق€™re not tempted to use them after a zero balance has been established on them, which will only put you into even greater debt.

Decide on the Bills to Pay Down Firstآ

You may decide to pay down the bills with the smallest balance first in order to free up some extra money quickly. This surplus money can be used in order to pay off another outstanding debt. Otherwise, you may decide to pay off the bills with the largest balance first due to similar reasons. You could also use a number of other strategies such as paying off the bill with the highest interest rate, the bill of a company you need to use again and are unable to unless you pay off your debt completely or simply paying off the oldest bill first. You must decide which strategy works best for your given situation after youق€™ve discussed what steps to take with each of the providers youق€™ve talked to. Keep in mind that you may have to juggle the debts every month in order to ensure you donق€™t get too far behind.

Find a Means of Making More Moneyآ

If youق€™ve already tightened your belt as much as possible, and still are having a hard time getting back on track financially, then you may want to consider taking on a part time job in order to pick up the slack. Be aware that this does not have to be a dream job, as any means of making an extra paycheck will be fine. It only has to be temporary, but itق€™s a good way to stay afloat during rough financial times.

Give Up Something

You may have to let go of a luxury that you allow yourself in order to save money such as an expensive haircut or a manicure or giving up a few months of having cable television in order to free up money that can be used to pay down your holiday debt. If you have a landline in addition to a cell phone then you could consider cancelling the landline in order to save even more money. Once you have completely cleared up your debt then you can start slowly bringing back the luxury services and products that youق€™re used to. However, you may even find that you want to keep saving money by swearing off unnecessary things like monthly manicures.

Plan For The Following Year

In order to avoid falling into a holiday debt trap next year, itق€™s a great idea to begin budgeting for the next holiday season once youق€™ve gotten yourself afloat from the previous one. Start purchasing gifts, decorations, and wrapping early as well as other holiday expenses when holiday items are on sale so that you donق€™t end up spending a huge lump sum all at once.

De-clutter

Getting rid of the items that you donق€™t want or need can kill two birds with one stone, by de-cluttering your life while also potentially making money. You can do this by selling unneeded items online or by putting on a garage sale. This can help add a little extra padding to your budget. In order to do this, make an inventory to see which household items you want to keep around and which ones you donق€™t mind parting with.