The Best Ways to Pay Off Holiday Debt Now




Use these tips to pay down balances on your credit cards.


After two years of dealing with wave after wave of the coronavirus pandemic you may have felt like splurging on yourself or your family during the holidays was warranted. Or, perhaps you purchased lots of small gifts for loved ones that ultimately added up to larger amounts than you anticipated.

We know earning points and miles can be tempting, but if you paid for the holidays with credit cards you can’t pay off in full now that the bills are rolling in, you could end up canceling out your points with high interest charges. Or worse, you could rack up new debt that could take years to pay off. Here are some ways to stop spending now and make a plan to pay down the debt as quickly as possible.

Delete credit card info from subscription delivery services

Amazon Prime and other delivery services make it incredibly easy to get what you want delivered to your door in just a few clicks of a mouse. You can make the process of buying what you may not need much less convenient by removing your credit card info from your account so it’s necessary to pull out a card and type in all of the digits every time you want to buy something. Same goes for other websites you buy from often. Don’t save your credit or debit card numbers on the platform. That way, you’ll keep your account numbers more secure and make it a little more difficult to indulge in late-night spending.

Lock up your plastic

Sometimes, the only way to keep yourself from buying more things you don’t need is to lock up your credit cards in a home safe or store them deep in a drawer and – most importantly – out of your wallet. You should do whatever you need to do to keep yourself from using the credit cards until you can get your debt under control. For some people, only using a debit card is a way to make sure they don’t spend more than they have in their account.

Only buy what you need

Unless it’s food, shelter, transportation to your job or monthly utilities, don’t spend money on it. When you consider purchasing something while digging out of debt, ask yourself: Do I REALLY need this? If you are honest, the answer will almost always be no. Even paying for a car repair could be postponed for a few months if you have another way to get there. Could you catch a ride with a colleague, neighbor or spouse until you have enough saved to pay for the parts? Could you work remotely at least a few days a week to make being without a vehicle less of a burden?

Pay as much as you can every month

Credit card issuers are happy for you to make the minimum payments on your accounts because it means more money for them. When you only make the minimum, you could end up paying thousands more than you originally owed. Credit card companies are now required to show how long it will take to pay off your debt if you only make the minimum payment. Spend a few minutes reviewing your next statement to fully understand why it’s crucial to pay as much as possible every month so you won’t be on the hook for years to come.

Transfer balances to cards with lower rates

If you are good at paying your bills on time, it’s likely you are receiving credit card offers in the mail. Transferring balances to a card with a zero (or very low) introductory offer would give you the opportunity to make some progress. Always set up an automatic payment to come out of your checking account on or before the due date to ensure you keep the promotional offer.

Look for money in unexpected places

If you aren’t already living on a budget, it’s time to evaluate all of your expenses to see where your money is going. Cancel subscriptions and memberships you no longer use. If you eat out frequently, prepare more meals at home and pack a lunch for work. If you are spending more than you earn, it may be time to look for a second job and then put all of that money into paying off the debt. You may also consider selling some of your assets to get ahead. If you own jewelry, an RV, camper, boat, motorcycle or a second or third car, you could sell them to pay off the debt more quickly.

With Reporting By Casandra Andrews