Thanksgiving, Christmas, Chanukah, New Year's and all the rest are such a happy time each year that many in the United States spend much of the year planning for it, then recovering from it. The cost of giving gets out of hand for some people; if you've got a pile of holiday bills, here are some tips to getting out from under them quickly.
Spending "fast"
A spending fast is not a race to see who can spend the most the fastest - just the opposite. Just like a food fast can help you cleanse your system, a spending fast can help you restore balance to your checkbook. Most people can cut out virtually all discretionary spending for 30 days.
Garage sale
I'm not suggesting you sell your children's Christmas presents in January, but as you look around the house, you may find that holiday gifts were, in some cases, replacements for older things that can be sold. A few things can easily be sold on Craigslist or eBay. A larger collection of small items may inspire a garage sale or yard sale.
Moonlight
If your schedule allows, it may be wise to take a part-time job for a few months to put this mess behind you. Be sure to focus on getting the debts paid. Don't fall into the trap of spending the additional income on other things and keeping the debt. You'll just end up stuck with two jobs and you and your family will suffer.
Income tax refund
If you anticipate a tax refund this year, file your return in January to get that refund in the bank as quickly as possible so you can pay off Christmas.
Prioritize
Until you have this holiday hangover cured, make sure you prioritize all of your spending. Paying off Christmas should be a top priority. Among the credit cards with balances, further prioritize by interest rate - pay off the cards with the highest interest rates, first.
Make a plan
If previous tips don't get you back on track after the holidays, make a plan (I mean a budget) to get the rest of the holiday pile paid off before the end of June - that will give you 6 months to save up for next Christmas so you can avoid the after-Christmas blues next year.
Remember that the interest you pay on credit cards, especially department store cards, is expensive - sometimes as much as 2 percent each month. If you have a $2,000 holiday hangover that's $40 per month or $480 per year - almost a quarter of your holiday spending could be wasted on interest. Make paying it off a top financial priority.
Make a point to avoid this trap next year. You'll save enough to have a better Christmas if you avoid putting the holidays on credit cards you can't afford to pay off with the cash in the bank.
