How to Cure Your Debt Hangover
The holidays are over once again and if you’re anything like most Canadians, you might be walking―nay, crawling―into the New Year feeling a little hung over. But not from an over-consumption of mulled wine (although that probably didn’t help). No, this hangover is thanks to all that holiday spending and the start of those holiday bills piling up.
According to a 2017 survey conducted by Ipsos on behalf of MNP, nearly a quarter of Canadians said they lost sleep due to overspending during the holidays and three in 10 Canadians said they felt anxious about the arrival of their holiday shopping bills.
If you’re dealing with a debt holiday hangover right now, these 5 tips might be able to help!
Tip #1: Assess the damage
Before you can rectify anything, you need to know exactly how much you owe. From buying gifts, attire, décor, food, etc. to the unplanned expenses like eating out, little pick-me-ups (like those extra coffees you needed to get through shopping), postage, shipping, gas, cards, Black Friday/Boxing Day sales, etc.―it all adds up! Once you’ve gone through your debit and credit card charges and made a list of everything holiday-related, you’ll be able to put an exact number to your holiday debt and start planning to pay it off.
Tip #2: Prioritize your payments
Once you have a full picture of your debts and continued monthly expenses, narrow them down by priority. Which payments must you make first? (Like your mortgage, car payments and monthly services.) From there, list your other payments and debts in order of priority so you can tackle them effectively.
Tip #3: Create a budget
Instead of adopting a similar plan of action like your New Years Resolutions (drastic dieting, anyone?), take the time to create a sustainable budget that won’t have you sitting in starvation mode or feeling like you’ve set yourself up for failure. By understanding how much money you bring in each month and how much money gets directed towards payments, you’ll be able to clearly see how much money you have to work with each month to pay off your debts―while still leaving some room in there for life.
Tip #4: Turn your blinders on
You’re in holiday debt recovery mode, so the last thing you need to see are more things to buy or experience. Eliminate those temptations by trying the following:
- Unsubscribe from emails from your favourite stores
- Unfollow social media accounts that draw you into their sites (and eventually into their online shopping carts)
- Avoid malls or places/events you’re more apt to spend money
- Talk to your friends and family about finding cheaper alternatives to hanging out and your financial situation
Tip #5: Ask for help
If you feel like your debt is over-taking your life and feel helpless trying to manage it all, it might be time to seek out professional advice. Our counsellors are here to help you through all your financial struggles. With our credit counselling, money coaching, financial education and debt consolidation services, you’ll be able to reclaim your life and not let your holiday debt hangover get the best of you. For more information on how we can help, contact us or book an appointment to speak with a counsellor near you.
At the end of the day, the holidays are just a small part of a greater year and it’s normal to let loose a little during this time. You had a wonderful month filled with good family, friends and food! But to ensure you don’t experience another post-Christmas debt hangover, plan for this year’s holiday season now. We promise it’ll help you stress less this time next year!