The holiday season is something we wait for all year, but what comes next is always painful. From a post-holiday debt survey done by MagnifyMoney, an average American had racked up about $1054 worth of debt simply from shopping for the holidays. This will only get worse for people who are paying the minimum on their credit cards.
Manage your holiday debt before it takes you down by following these simple tips:
- Cash out on those frequent flier miles
If you just finished burning a hole in your pocket this holiday taking a trip to the Bahamas, pull out those tickets because we need you to redeem all the frequent flier miles and reward points. Request your bank to turn them into cash, and pay off!
- Sell what you don’t need
This advice will never get old. Do not sit on the old TV, couch in the attic and a bunch of electronics in your garage that you are never going to use, an average American household sits on $250 worth of unused things. Trade them for cash online and transfer the money towards your credit card debt.
- Take help of a trust deed
This way, even though the bank retains ownership of your assets, you are allowed to hold it. So the bank’s interest is protected as you sign off the trust deed to your car or any other merchandise whereas you get to keep using it while you go to work to make enough to pay off the bank. The bank will only take full control of your asset when you have defaulted on the loan.
That brings us to the most important part: make a budget and live by it. Cut off all expensive habits you have, at least until the debts are paid off. So happy and responsible holiday shopping everyone!