A Guide to Managing Post-Holiday Debt

The holidays are a time of generosity and joy, but once the decorations are packed away, the arrival of credit card statements and Buy Now, Pay Later (BNPL) alerts can bring a different kind of feeling. The rise of convenient online shopping options and BNPL services makes it easier than ever to overspend. While these tools offer flexibility, they can also contribute to a challenging financial situation in the new year. The key is to face the debt head-on with a clear and manageable plan.

Face the Numbers and Assess Your Debt

The first step is to get a complete picture of what you owe. Don’t avoid the bills. Gather all your credit card statements and log in to any BNPL accounts. Create a list of each debt, the total amount owed, the interest rate, due date, and the minimum monthly payment. Understanding the full scope will set you up for success.

Create a Targeted Payoff Plan

Once you know how much you spent, strategize about the best way to pay it back. Some options may have a zero-percent interest rate, but high late fees, so set up automatic payments so you don’t have to worry about a missed deadline.

To free up more money for debt repayment, take a close look at your monthly spending. Identify non-essential expenses, such as dining out, entertainment, or subscription services, that you can temporarily reduce or pause. Redirecting these funds toward your debt, even for a few months, can make a substantial difference.

Try paying more than the minimum amount on your credit card and loan bills. Even small extra payments can reduce the principal balance faster, which in turn lowers the amount of interest you’ll pay over the life of the debt.

Contact Your Creditors if You’re Struggling

If you cannot make the minimum payments, don’t wait. The Federal Trade Commission recommends calling your creditors as soon as possible. Lenders may be willing to work with you and place you on a more manageable payment plan. Being proactive can help you avoid late fees and potential damage to your credit score.

Take Control of Your Financial Future

Paying off debt takes time and discipline, but with a clear plan, you can make steady progress toward financial freedom. With a thoughtful strategy and consistent effort, you can successfully manage your payments and move forward with confidence.

If you’re unsure where to begin or want to explore options like debt consolidation, our Associates are here to help. Talk with your banker to discuss the best solutions for your unique financial situation. They can help you review your budget, understand your options, and create a personalized plan to achieve your goals. Visit one of our banking offices or set up an appointment.