Now that the holidays are over and it’s back to reality, you may find yourself with some significant debt to pay off. Perhaps you overspent during on gifts and food, or perhaps a major unforeseen emergency has left you financially destitute, but whatever the cause, there’s no reason to fret!
Having holiday debt can be so stressful and overwhelming that you be worried you’ll never be able to get out of it, but if you’re willing to adjust your lifestyle and get serious about your finances, then paying off debt fast will be within your reach.
For help with getting out of your holiday debt, try one, a few, or all of the following tips:
1. Prioritize
Make a list of all of your debts and prioritize which ones need to be paid off first. What has to be paid off as soon as possible and what can be put on the backburner for now? Which debts could affect your equity and which debts consequences are miniscule? If any of your debts could lead to you losing your home, job or any valuable equity make sure you prioritize to pay them off first.
2. Pay High Interest Debts First
If you have high interest debt such as a high interest student loan or credit card debt, make sure you pay this off first. Paying off the highest interest accumulating debt first makes sense, since it saves you the most money in the long run. Protect your credit score and pay off any debt that’s due, but only make minimum payments for those debts that have low interest rates, and pay as much as you can afford to on those that have higher rates.
3. Stop Making Charges to Your Credit Card
If you made one too many charges to your credit card this holiday season to pay for your kids gifts or for a big Christmas meal, you may now be in a lot of credit card debt. If this is the case, you should stop making charges to your credit card immediately. When it comes to learning how to pay off credit card debt fast, the first step is accepting that you’ve overused your card and realizing that it should only be used for emergency situations. Once you’ve stopped making new charges on it you can see just how much debt you owe and make a logical plan to pay it all off.
4. Always Make the Minimum Payment
When you start to pay off your holiday debt, always make the minimum monthly payment, as this will help you avoid penalty fees and various other hidden fees associated with late payments. No matter how much debt you have and across how many credit cards, it’s essential that you make each monthly minimum payment to both maintain your credit score and to help prevent your interest rate from rising. Make a note in your online or paper diary of when your minimum payments are due and try your hardest to always meet them.
5. Contact Your Creditors
Struggling to even make the minimum payments? Then contact your creditors and explain your unique situation. Yes, creditors can have a reputation for being ruthless but many will be willing to renegotiate a repayment plan which could include lower monthly minimum payments and even lower your interest rate. There’s no guarantee that they’ll be able to do this, but to pay off debts within a reasonable timeframe you may have to pull out all the stops.
6. Cut Back
In order to get out of your holiday debt, you’re likely going to need to cut back on your expenditures in order to make way for more money being freed up for paying off debt. Take a look at your monthly expenditures and see where you can cut corners and save big. Perhaps you could cancel that gym membership you rarely use or limit the amount of times you eat out per month. Wherever you can cut back on do it, as this will allow you to get out of your holiday debt faster and back onto the road of financial recovery quicker.
7. Take On Extra Work
If you’re still struggling to pay off your debt you may want to take on extra work. Maybe you could take on some extra shifts at work or do some over-time. If you’re self-employed or aren’t able to secure extra work through your current job you could always take on another part-time job just until you get your finances back in order. Perhaps you could do some odd jobs around your neighborhood or take on a local seasonal job to take the financial weight of your shoulders a little. Taking on extra work is never fun and can be very exhausting, but if it can help you get debt free, then it’s ultimately worth it.
8. Consider Debt Consolidation
For substantial debt, consolidation may be necessary. Debt consolidation allows you to change the structure of your debt, combining debts to multiple creditors to a single source (to simplify payment plans), reduce interest, extend the term of your loans, or do other things that can make your debt more affordable. However, always be aware that many debt consolidation companies charge you fees for going through them, so try to get the consolidation done on your own by contacting your creditors, putting them in touch with each other, and negotiating yourself.
9. Take Out a Loan
Taking out a loan to pay off debt may seem mad when you’re already in debt, but in some cases it can be a wise decision. Many people rely on loans to pay off debt, especially when they can secure a lower interest rate loan to pay off a higher interest rate debt. Look for affordable loans that won’t lead to long-term financial disaster, make sure to avoid the traps of neighborhood loans and cash advances, and consider relying on secured personal loans or collateral loans, like car title loans, which can be had on the cheap. Title loans are issued based on your ability to repay the loan.
10. Create an Emergency Fund
Avoid finding yourself in such a financial mess again next holiday season by creating an emergency savings fund that you can tap into next year for just this situation. Once you are debt free, start putting aside a small amount of money each month so that you can accumulate a safety reserve for troubled financial times. Savings accounts accumulate interest in your favor, can be had for free, and are a great way to store money safely for the long-run.
Car Capital Financial
If you have a lot of holiday debt and you don’t know how to get out of it, Car Capital Financial may be able to help. We are a leading Southern California car title loan company with 15 years of experience helping people get out of liquidity crises.
We pride ourselves in offering fast and incredibly professional service, and we promise to treat you with the respect that you deserve. Call us now at 1-888-500-9887 now to get the cash you need in as little as 30 minutes!