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5 Tips to Reduce Post-Holiday Debt

post-holiday debtDid you know that 1 in 3 Canadians will spend more than they intend to this holiday season? Heading into the holidays with a solid plan not only helps prevent overspending, it can reduce your post-holiday debt obligations.

Plan Your Holiday Spending

Approaching gift-buying and seasonal celebrations with a budget in hand is the best way to save money and minimize debt. If you don’t know how much you should be budgeting for holiday expenditures, make this the year you start collecting and adding up your receipts.

How to reduce your post-holiday debt? Depending on your personal celebration style, you may want to track spending on:

  • gifts, cards, and wrap,
  • food, alcohol, decorations, and other entertainment costs,
  • holiday visiting and travel expenses (including extra gas), and
  • any plans to celebrate New Year’s Eve

Once you know how much you typically spend over the holidays, you can initiate an automatic bank transfer – from your chequing to a dedicated savings account, for example – to set aside a portion of that amount every month until next year.

The better prepared you are for all those little extras that crop up during the holiday season, the less likely you are to turn to a credit card to help cover costs. And being less reliant on credit or a cash advance loan will mean carrying less debt into the new year.

Tips for Preventing Post-Holiday Debt

Planning ahead is highly effective for debt management. But there are steps you can take to lessen the pressures of this spending season while you track all your costs for next year.

Here are 5 proven tips for keeping expenses from spiraling out of control and minimizing your post-holiday debt:

  1. Even if you’ve yet to establish an annual budget, you can approach holiday gift giving with a spending limit in mind. Write down the name of everyone you plan to gift – from your family members and coworkers, to your hairstylist or veterinarian – and assign a realistic dollar value to each.
  2. Don’t wait until the last minute to do your holiday shopping. Rushing through your list is all too likely to result in your spending more than you would have if you’d allowed yourself time to compare prices.
  3. In-store retailers use music, lighting, and decorative displays to their advantage to encourage impulsive holiday spending. Consider shifting the bulk of your shopping online where there are fewer buying triggers and it’s easier to comparison shop undistracted.
  4. Did you know that thrift store gifts have become enormously popular? “Thrifted gifts” purchased at charitable resale stores are a win-win-win approach to holiday giving. And there’s the added bonus that, since many of these shops don’t accept credit cards, they can help you avoid post-holiday debt.
  5. Remember that the gift of time is often the best gift of all. Why not turn your hobbies or creative interests into personalized gifts for your loved ones? You can also consider gifting shared experiences in the form of homemade coupons that promise lunch, coffee, a hike, or some other special outing with the people you care about most.

Making a plan to avoid overspending is your best bet for reducing post-holiday debt. But if you’re a homeowner who’s already accumulated multiple high-interest consumer debt loans or credit card balances, don’t panic.

Regardless of your income, age, or credit history, a home equity loan from Alpine Credits can provide you with additional cash flow for any temporary situation that may arise – including debt consolidation. Talk to us.

At Alpine Credits, Homeowners Get Approved.

Apply now or call (1-800-587-2161) to find out how you can subscribe for RESP through your home equity.