Below are a few tips to help consumers get back on track financially.
•Conduct a self analysis. Gather receipts and check on credit cards to see exactly how much you owe. Waiting around for bills to arrive in the mail will just amount to a loss of valuable time that could be spent on planning your pay-down strategy.
•Devise a plan to pay off each creditor as quickly as possible. A good place to start is by not increasing your debt load. Lock up your credit cards if you need to, to keep yourself from using them while you are working to get your debt under control. Make a list of how much you owe each creditor, what interest rate you are paying to each, as well as due dates and minimum payments for each. Always try to pay more than the minimum payment due and try to pay the debt with the highest interest rate off first. Remember; never be late with a payment. Late fees can be very costly and will only add to the amount you owe.As one debt is paid off, take the money you were paying toward the paid-off debt and apply it to the regular payment of another debt. Continue this same process until all debts are paid in full.
•Negotiate with creditors. Don’t be afraid to pick up the phone and ask for better terms, perhaps a lower interest rate.
•Make some temporary cutbacks on your expenditures. Make a list of everything you spend money on each week, and determine what areas you may be able to cut back on. Here are some ideas of some spending you may be able to cut down or out. Eating out, whether it’s, lunch, dinner or a quick snack at a drive-through, buying snacks and sodas from vending machines, gourmet coffees, new clothes, gym fees, manicures, pedicures, movie rentals, sporting events, impulse purchases from the grocery store (which may include gum, candy and magazines among other things), and the list goes on! It may take a little discipline, but decide where you can cut back, and apply the money you would have spent on these “extras” towards your debt instead.
To be sure “holiday debt blues” don’t get you next year, develop a spending plan now, to follow all year long. Write down your household income and your expenses each month including your debt. Be sure to include a “savings plan” that will cover holiday spending as well as other seasonal expenses, so you are not caught by surprise when one-time expenses arise.