It’s easy to overspend during the holidays – you’re excited, your feel-good chemicals are in over drive and you’re feeling generous.
We’ve all been there before. In fact, we were estimated to overspend last Christmas by a whopping $625 million – that’s a lot of overstretched budgets!
And if the holiday hangover isn’t bad enough already, when you overspend, you get hit with a double-whammy of debt and interest. But don’t despair, recovery is just around the corner if you just follow these simple steps:
If you’ve gone a bit overboard this holiday season, it’s time to halt your spending now. For the time being you should only be focused on paying necessary bills and scaling down your debt. You’ll need to hit snooze on your discretionary spending if you want to get your finances back under control.
Do a deep dive
Gather all of your receipts, pull up your credit card bill and start tallying up the damage. It can be quite a sobering experience to see all of your holiday expenses tallied up at once, but it allows you to determine exactly how much you owe.
Once you know how much you owe, you can devise a plan of attack to get your finances back under control. You’ll need to take a look at your budget to see what you can realistically put towards paying off your holiday debt. That could mean taking a lump sum out of your savings, or perhaps paying in monthly increments.
If you think you’ll have a hard time making your monthly credit card bill, call your credit card company to see if you can move your payment date or lower your interest rate. You never know until you ask, right?
Get back to your budget
You’ll want to get back to your planned budget as quickly as possible. If you don’t have a one, now is the time to get one. Stick to simple budgeting techniques such as tracking your monthly income and fixed expenses to determine how much money you have left over for food, savings, holidays and miscellaneous items.
Re-trace your steps
Once you’re in recovery mode with your plan in place, it’s time to retrace your steps to see what went wrong. By figuring out your fumbling blocks, you can discover how to prevent another costly spending spree. Check out this article on how to save during silly season so that you can make sure you don’t repeat the same mistakes again.
Don’t beat yourself up
You may be feeling down if you’ve blown your budget over the holidays, but beating yourself up is never worth your time. Pat yourself on the back for recognising the overspend and focus your energy on making things right.
You can recover, and you’ll learn some valuable lessons in the process. You just need to hit pause on all unnecessary spending, assess the damage, put together an action plan, and retrace your steps. With a plan in place, you’ll be back to normal in no time!
If you’re feeling overwhelmed by your holiday debt, we’re here to help. Call one of our experts on 1300 368 322 to get back on track today.