Five Tips for Tackling Holiday Debt

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Posted on 12/31/2013

Did you wake up Christmas morning with a big pile of debt under the tree? A recent survey conducted by Harris Interactive found that 57 percent of adults with children were prepared to take on debt in order to make their kids happy over the holidays. Those with an income less than $35,000 were willing to rack up an average of $700 in debt while those with an income of $75,000 or more said they were likely to accrue about $300 in debt for the same purpose. So if this sounds familiar, try following these tips for tackling holiday debt.

Get a Reality Check
If you left the Thanksgiving table to score some deals or set your alarm clock really early on Black Friday to save a few bucks you probably spent less on gifts than someone who paid regular price. But if you leave those purchases on high interest credit cards that savings will be eaten up in no time. Give yourself a reality check with the help of a free debt payoff calculator like the one at bankrate.com. You'll see how much interest you're actually paying the longer you hold on to your debt.


Sell Your Old Stuff
If you got a new TV, pair of snow boots or back massager for Christmas why not clear the clutter and sell the old version online? Generating an influx of quick cash will help you pay down the debt quicker and avoid paying as much interest.


Join the Money Diet
Hundreds of people participate in the January Money Diet each year. For 31 days you must swear off non-essential spending. Sign up at happysimpleliving.com. The less you spend the more money you'll have to pay off holiday debt.


Transfer Your Balance
Transfer your credit card balance to a card with zero percent interest. Chase Slate offers no interest on balance transfers for 15 months. Just don't use this an excuse to rack up more debt.


Open a Christmas Savings Club Account
The last thing you want is to repeat this situation next year. Christmas never comes as a surprise - it's always December 25. So start preparing for 2014 by opening a Christmas Club account like this one at citizensfirstbank.net. Deposits of any amount can be made from now until October. If a withdrawal is made you forfeit the interest you accrue. Otherwise you'll get a nice check in the middle of October so that you won't have to resort to debt for Christmas 2014.


By Alison Storm


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