Reestablishing financial normalcy after the holidaysDate posted: 1/6/17 11:00:00 AM
The holidays are one of the most expensive times of the year, with costs that vary from presents to decorations and travel. That means post-holiday financial recovery should take center stage in January.
Decrease overall spending
Because there was such a substantial rise in your spending habits over the holidays, you will need to adjust moving forward. Cut costs by determining which expenses are necessary and which expenses are luxuries. To recover fastest from the holiday, you will likely need to stop spending so much on eating out at restaurants, entertainment, and the clothes and electronics you don't need right now.
Create a budget and stick to it until you get back on track.
Consider increasing your income
One way to expedite the process is by taking on an additional part-time job or finding another way to increase your income.You can host a garage sale or sell services, like tutoring or shoveling snow for your neighbors. Inforum suggested driving for a ride-sharing service or participating in a research study to bolster your finances after the holidays.
Getting your finances back in order will require hard work on your end. Do not hesitate to take on another job. Whether you have experience in food service, bartending or working in retail, there are many industries that hire after the holiday season.
Pay off credit cards
First get your debt organized and figure out a plan for paying it off. If you used your credit card to help pay for holiday expenses, you will need to address your higher balance after the presents have been opened and the season comes to an end.
Your credit score is critical to your financial future. Staying on top of payments and ensuring your credit report reflects fiscal responsibility all year long is of utmost importance. Do not let the holidays distract you from making payments on-time and in-full whenever possible.
Make a plan and determine which debts have the highest interest rates and which cards have the highest balances. This is where you will want to focus your resources. Paying down high-balance, high-interest rate debt first is critical because they can have the highest impact on your credit score.
Try to eliminate credit card spending in the new year so you are not piling on additional debt.
Avoid issues in the future
Of course there are ways you can avoid financial issues next year for the holidays, according to Apartment Therapy.
Before the holidays roll around, set a budget for yourself and start saving an amount monthly or weekly in order to accumulate the savings you need for the next holiday season. Making saving automatic can help you stick to you plan.
Because holiday decor and other seasonal items will likely be on sale after the season comes to a close, consider stocking up now while prices are low. You can use your loot for decorating next year, and you won't be in such a financial tight-spot when November and December 2017 roll around.
If you find any items throughout the year that you know your loved ones will enjoy, buy them when you see them instead of waiting until the last minute. If you spread your holiday shopping out throughout the entire year, the financial blow will have far less of an impact.
The holidays are a fun and festive time of year, but they can wreak havoc on your bank account. Plan ahead and approach the new year with a financial strategy in mind.
- Reach your financial goals in 2017: Part II - 1/13/17
- Housing market 2017 predictions - 1/12/17
- How to pay down your debt - 1/11/17
- Buying v. leasing a car - 1/10/17
- 'Til finances do us part - 1/9/17