By Diann Douglas
Guest Columnist
Now that the holidays have come and gone, the bills will soon begin to arrive. You may be shocked at the total amount on your credit cards. Didn’t realize all the fun you had during the holiday season had such a price tag? You may have overspent like many other Americans. It can be difficult to avoid the traps of sophisticated marketing techniques utilized by retailers. Whatever the reason, overspending can leave us with a holiday spending problem – a large debt. Dr. Michael Gutter, Financial Management Specialist with the University of Florida highlights several strategies that may be helpful for you to do.
Now that January is here, you may need to give your credit cards a holiday. While you are planning out your repayment plan, you should put the cards away. Do not take them with you unless you need them for refunds or exchanges. Operate on a cash only basis for the next few months while you are paying off debts. One thing you want to avoid is the post holiday spending. We all know you can get some great deals, but you can go broke practicing this money strategy – you are still spending money. By not making purchases, you will be able to engage in real savings!
Determine the total amount of money you spent over the holiday season. Believe it or not, most people avoid looking at the total. Take time to sort out your bills and add up exactly how much money you spent. While this may not be a fun task, it will give you a clear picture of the money you now owe. A word of warning, you may be shocked at the total! Don’t be overwhelmed, you can pay off your debts with steady, consistent payments.
The next step is to set up a debt repayment plan and stick to it. This need not involve a third party, just an honest discussion and different choices on your part. Create a timeline to pay off your debts. One great tool for this is PowerPay. It is a free online program developed by Utah Extension to help you organize your debts, create a calendar for repayment, and show you how to most efficiently use extra money to pay down your debt more efficiently. A great tool to keep you on track with paying monthly bills is our Extension 2012 Money Management Calendar. For your free copy, stop by the Extension office.
There is always the question of what to do as a substitute for those shopping trips that occupied your time over the last 6 to 8 weeks. It is now a great time to work on those projects you have been postponing because of the holiday season. Get busy and organize your filing cabinet, clean out those closets and cupboards, transplant plants in your yard. You may want to start that daily walking program you’ve been meaning to do for the past 6 month. When you tackle these home and self improvements, you’ll find yourself productive and not tempted to go out and add to your debt load.
Part of your holiday repayment plan needs to include a way to start saving now for 2012. It becomes difficult to meet your expectations for the holidays year after year without planning ahead. By knowing what you spent this past year, you can set up a goal to have a certain amount in a savings account to use for the next holiday season. Some banks have special holiday accounts which allow you to put money into savings on a regular basis. If you aren’t a good saver, this type of account may be helpful.
For more information on money management or assistance with developing a debt repayment plan, contact the Madison County Extension Service.
The University of Florida Extension/IFAS Madison County is an Equal Employment Opportunity Affirmative Action Employer authorized to provide research, educational information and other services only to individuals and institutions that function without regard to race, color, sex, age, handicap or national origin.
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