7 Steps to Take After a Holiday Spending Spree

Topics: Reading time: 4 minutes

It’s easy to overspend during the holidays – you’re excited, your feel-good chemicals are in overdrive and you’re feeling generous. It is the season of giving after all.

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. However, you don’t have to despair. Recovery is just around the corner if you just follow these simple steps below.

1. Hit Pause on Your Finances

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. This can be seen as a financial reset. When you take a few days, weeks, or even months to hit pause on your finances, it helps you get in the right mindset of saving.

2. Face Your Budget

This can sometimes be the hardest step, but it’s also the most necessary. The last thing you want to do is hide from your spending and pretend it never happened.

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.

3. Evaluate Your Repayment

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?

4. Trim 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.

This is also the time to trim your budget. Look if there’s anything you can give up for now, whether it’s an extra streaming service or nights at the pub. By cutting back for a few weeks, you can allocate that money towards your holiday debt payoff.

5. See What Went Wrong

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.

Learning how to save during silly seasons in the future is a great way to avoid making the same mistakes again. Things happen, but we can learn from them so our future is a brighter place.

There are a lot of common mistakes that happen during the holiday season like:

  • Shopping last-minute
  • Not using coupons, discounts, or sales
  • Buying gifts for too many people
  • Going overboard with your gift-giving
  • Not saving decorations, ornaments, etc. from previous years
  • Going on an expensive holiday
  • Not sticking to a budget (or not making one at all)

You’ll want to avoid making any of the mistakes above if you’re hoping to keep your finances in the clear next time. Luckily, there are so many ways to have fun, practice gratitude, and give back that don’t require big spending.

6. Start Saving for Next Year

One of the best ways to avoid a repeat performance of your holiday debt hangover is to start saving early. While it might sound counterintuitive to start shopping again pretty soon after the holiday season, starting early can save you big.

For example, you can score major deals on wrapping paper, gifts, decorations, and so on if you shop in January. Similarly, look for sales and coupons to snag gifts earlier than usual. When you space out your shopping all year long, you won’t face any huge expenses at once.

You don’t want to rack up debt again in the following year, so the more savings you can achieve, the better. Shopping for the holidays is an art form. You can still practice the giving spirit without going overboard.

7. Forgive Yourself and Do Better

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.

Having the ability to think critically about what went wrong and make a plan for the future is something to be proud of. Feel confident knowing that you now have a smart action plan for next year’s holiday season, and you know better than to fall into the same debt hangover this time.

How Does Your Holiday Spending Add Up?

Life is full of lessons, and the holiday season is no exception. While giving gifts to the ones we love and spreading holiday cheer is always fun, you don’t want to go overboard. Spending too much during the holiday season could set back your savings of debt payoff goals.

Still, no matter what you see in your bank account, you can recover. Better yet, 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. You don’t have to find your way out from under holiday debt alone.

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Debt Busters is an Australian owned business which was founded in 2005 - since then we have been able to help thousands regain financial control.

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