4 tips to ditch post-holiday debt
How to unburden yourself from your post-holiday debt and start the new year with a clean financial slate


As the holiday glow starts to fade and you re-enter your regular routine, you may find yourself facing the fact that you spent more than you should have during the holiday season. Maybe you went a bit overboard on gifts and decorations, or perhaps you got swayed by the season's slew of sales.
While you can't undo your spending (and maybe you wouldn't even want to after seeing the smiles on gift recipients' faces), you can take steps to unburden yourself from your post-holiday debt and start the new year with a clean financial slate.
1. Put in place a payoff plan
The first order of business post-holiday spending spree is to assess the damage and then come up with a plan for paying down any debt you've accrued. Two common methods for paying off debt are the debt avalanche method and the debt snowball method. With the avalanche method, you focus on paying down your debt with the highest interest rate first, which can save you on interest. The snowball method concentrates on paying off your smallest debt first. As Credit Karma explains, "you may pay more interest using the snowball method, but it can help you stay motivated as you watch the number of accounts you have to pay off dwindle."
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How long should you give yourself to get debt-free? Ideally, you'll set "a budgeting goal of paying it off in three to five months," according to CNBC's interview with Nicole Cope, director of wealth strategies at Ally.
2. Slash spending, at least for now
"The best way to reset your budget after the busy and expensive holiday season is to detoxify your spending with a no-spend month," consumer finance expert Andrea Woroch tells Bankrate. This doesn't mean you can't spend anything, as some living expenses are unavoidable, but rather you commit to "a few weeks of as few purchases as possible," as Bankrate explains it.
If that sounds like a big ask, another option is to simply "cut unnecessary expenses for your budget," per Bankrate. For instance, suggests Bankrate, you might aim to "cut your takeout or grocery bill," get rid of "underused subscriptions," and even "cut back on your monthly expenses by negotiating your bill payments."
3. Ask your credit card issuer for a lower rate
If you've racked up a steep credit card balance from your holiday spending, you can make repayment easier with a lower interest rate. Believe it or not, it is possible to call up your credit card issuer and ask them for a lower rate — and, according to a LendingTree study conducted in April 2022, "70% of people who asked for that in the past year got their way."
Even if your credit card issuer does grant your request, you'll want to make some other adjustments as well though. Per LendingTree, "if you can get that lower rate, stop charging things to that account and start contributing more than your minimum required payments," which will make getting rid of your post-holiday debt that much easier.
4. Consider debt consolidation
If you feel like you're up to your neck in debt, another option that may allow you to "pay less interest and get out of debt more quickly" is "by consolidating your accounts with a balance transfer card or debt consolidation loan," suggests Experian.
With a balance transfer credit card, you may be able to score a 0% APR introductory offer, which means that for a set period of time you won't pay interest. However, note you'll likely pay a fee on the amount you transfer to the card, and if you fail to repay your full balance by the end of the promo period, the standard APR will kick in.
A debt consolidation loan, on the other hand, is "a personal installment loan you use to pay down or pay off your credit card debt," per Experian. They "typically have lower fixed interest rates than variable rate credit card debt," and since "they're installment loans, you get a fixed monthly payment and a finite loan term," explains Experian.
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Becca Stanek has worked as an editor and writer in the personal finance space since 2017. She previously served as a deputy editor and later a managing editor overseeing investing and savings content at LendingTree and as an editor at the financial startup SmartAsset, where she focused on retirement- and financial-adviser-related content. Before that, Becca was a staff writer at The Week, primarily contributing to Speed Reads.
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