- January 7, 2020
- Posted by: admin
- Category: Debt Payoff Tips
How to Handle Post-Holiday Debt
Everyone loves holiday season as it brings a lot of precious moments and happiness. Every person enjoys holidays by spending a lot of money on gifts, foods, and traveling. Most of these payments are through cards which is an easy method. However, on the other hand, the post-holiday debt waits for you which must be paid after the holiday season. We know that no one cares about the payments during the holidays. Since we get a holiday season after a long time, it is not the time for savings. Just like food, flights, and gift payments, we have to pay a lot of credit card bills and debts after the holidays. To make your holiday stress free, we have brought a plan to handle post-holiday debt. We will tell you some methods of how you can overcome your financial pressure after enjoying the holidays season. We know it is not a comfortable job to handle these bills and payments, but we ensure you that you will not only be able to handle them but will save a lot of money. The question is how to deal with post-holiday debt. Well, it all depends on your payment plans.
Mostly, the January credit card bills and payments are the largest ones in the whole year. This is because of new year spending and a list of all the payments you made in the holiday season. Well, it is not necessary that you always get a higher debt rate and payments to be paid. As the new year comes, it brings some hassles and tensions including that debt which has to be paid. To get rid of these debts and payments, most of the people commit some mistake that we will cover today. When you see your debt rate and the payments which you paid through your card, you think that the minimum debt plan is best for you as you only have to pay a small amount. Well, this is wrong. The minimum debt plan is the worst plan for your debt clearance. We know you want to see how to deal with the post-holiday debt with the minimum possible rate. Have a look at some methods to handle your post-holiday debt below.
Stop shopping for some time
You will easily find hundreds of January sales which offer a lot of savings that look amazing. The credit card companies want you to spend more and more through your card. It gives them a lot of profit and this is what they want. Similarly, the shopping companies and different brands introduce January sales so that that people spend their money right after the holiday season. Well, an intelligent person doesn’t spend on things blindly. What we mean by that is you will have to take care of what you are buying through your credit card. You could only consider the most important things that you want to buy through your credit card. If you don’t think about your payments and debts while purchasing through your card, you will have to pay for it in future. Its very simple; just stop using your credit card for some time until you get rid of all the debts that are to be paid by you. After that, you could use it regularly.
Avoid minimum payments debt
This is one of the biggest mistakes while paying the debt payment. Most of the people think that minimum payment plan is the best plan to pay the debt. There could be many reasons for it like better interest rate and a small amount of payment. Actually, this small payment is the largest one in your payment plan. Suppose you have the minimum payment of $80 according to your total balance and a specific interest rate. You choose to pay the minimum payment which lasts up to 50 or 60 months. It means if we make the total of 50 months with this minimum payment, we will get $4000. From your total balance, you will have to pay a lot of amounts. On the other hand, if you decide to pay the monthly payments with more cash like $140 instead of $80, the payment plan will be decreased to 22 months. Now if we make the total of it, we will get $3080 which is much lesser than the previous payment. So, you would only pay a small amount for your total loan. In short, don’t choose the minimum payment plan. It looks good but will cost you a lot more than a larger monthly payment plan.
Reduce your interest rates
Another amazing way of handling post-holiday debt is reducing the total interest of your debt. It means that you will have to try to reduce your interest rate. There is no a direct way to do this job. Yet, you can ask the credit card company to do it for you. If you are using multiple cards, try to consult with each card’s company. Most of the companies won’t allow you to pay debt with a lower interest rate. However, you can give it a try. Additionally, you can try a full balance transfer i.e. a balance transfer to zero. It is a good step to deal with post-holiday debt, but it contains some risks. Always do this job after reading the terms and conditions of the new card company. Also, if you are transferring the balance from one card to another, make sure the interest rate is reduced. Don’t take it too seriously. Just talk about the total interest rate which will help you in paying the post-holiday debt.
You can see various types of items to get some extra money. This is a very useful step to handle the post-holiday debt. These items include everything like the unwanted gifts you received on the new year and now you don’t need them. Similarly, the items in your home which is useless, but you think that they can be sold for a large amount of money. You can also consider selling your extra cards which are not in use anymore. The unwanted gift cards will give you a lot of money to overcome the pressure of post-holiday debt. There are a plenty of different sites which offer sale and purchase services for gift cards. You can try one of them to sell your card. Always make sure you are getting the highest value for your card. To do this job, you can compare different services and websites.
Don’t lose hope
After the holiday season, most of the people face a lot of debt which is to be paid. This is a horrible situation because there is a lot of money in due. However, if you take control of this situation, you would be able to handle it easily. Basically, when you spend a lot through your credit card, you pay back that much to finish the debt payment. Here the biggest question is how to manage such huge amount of money. Well, as mentioned above, you will have to make a plan for your debt payments. You cannot run from these payments as you will have to pay them one day. You cannot pay all of the payments at a single time either. So, what to do with them. You can try different methods like saving money, spending less, avoiding unnecessary shopping and selling unwanted gifts and items. All these steps will help you to collect some extra amount of money. Moreover, keep your eye on all the payments which have been completed and which are in pending. This will also help you to find out your post-holiday debt and the remaining payments.
Get a tax refund
If you want to handle your post-holiday debt easily, consider a tax refund. We all know about the tax refunds. A good tax refund can help you a lot to cover the debt payments which are in pending. Most of the people ask what they have to do in order to get a considerable tax refund. Basically, all you need is giving your tax and submitting the tax files. It includes every information regarding tax. You know how much tax you pay and how much is due. So, make a journal and write down every tax payment which is completed, and which is in pending. Before the tax refund comes, you can clear the tax list. So simply include tax information like daily expenses, medical payments and other receipts to the forum and get a tax refund.
Use credit card points
Credit card points are amazing when it comes to paying the debt. It can help you in several ways. Whether you are thinking about travel, or you consider buying some gifts, the credit card points can be used in different ways. Although you can use them for different purposes, yet completing the debt payments is your top priority. Everyone wants to get rid of post-holiday debt as soon as possible. So, what about using the credit card points to reduce the debt. So, if you have some credit card points that can be used, you must use them for your debt payments. Don’t spend them on useless things.
Manage your debts
Most of the experts say that you should choose the minimum payments on all of your debt plans. While it is not necessary but is suitable in most of the cases. However, oppositely, if you have more than one credit card, you would have to make another plan. When comparing different credit cards with different debt plans, always consider the debt with the highest interest first. What we mean by that is you will have to choose the debt which has the highest interest. the bigger interest rate will allow you to complete your debt payments easily and quickly. On the opposite hand, if you choose the minimum debt plans first, it will take a lot of time to complete them. Since you want to get rid of your post-holiday debt as soon as possible, consider the highest interest debt. You can also make a list of different cards with interest rates. The most prominent benefit of this plan is you will get rid of highest interest in a short period of time. As this credit card is taking a large amount of money from your pocket, it is necessary to complete it as soon as you can. After completing the highest debt, you could consider the remaining plans.
Be prepared for the next year
The holiday season comes every year and you know you have to pay a lot of amounts every year after the holiday season. So why not prepare for the next year and have a look at your expenses and debts. Well, it is very easy to make a plan at the start of the year instead of planning for how to complete high-interest debt plans. Basically, you would be able to save a lot of money if you make a plan in the start. You can adopt some different types of techniques to save money. If you save even a little amount of money on a regular or weekly basis, you would get a huge amount on the end of the year. It will not only help you to clear the debt but will also help you to maintain your expenses. Also, keep in mind that all the stuff and items you are buying through your credit card will give you some trouble in the future. To make sure you only buy the necessary stuff through your credit card.
Every person wants to enjoy holidays, but no one wants to pay the high-interest debt installments which come every year right after the holiday season. Unlike the holidays, these debt payments can give you a lot of hassle and tension. You will have to handle your post-holiday debt in a professional way. You can adopt some methods to complete your debt payments as mentioned above. Always keep an eye on your payments and expenses and spend your money on useful things. Also, don’t overuse your credit card if you want to get rid of post-holiday debt.