The holiday season is typically filled with cheer and warm wishes–however, that good cheer can trick even the most responsible spenders into getting a little too comfortable with their finances. Holiday spending can rapidly get out of hand, especially now that it’s easier than ever to purchase almost anything. Whether you’re at home or on the go, it’s possible to spend hundreds and even thousands of dollars with the click of a button.
If you, like many others, are finding yourself in a difficult financial situation after the holidays, rest assured that RMLEFCU can help you get back on track.
Tighten Up Your Budget
Now is the time to create an action plan–in other words, it’s time to put together a post-holiday season budget. Sit down and note how much you owe across all of your accounts, the associate interest rates, and how much you need to budget over the next few months in order to pay off any credit card debt.
Here are a few tips we have for this important step:
Pay more than your minimum payment each month: Making larger payments each month helps you get out of debt faster, but it also minimizes the amount of interest you have to pay on your debt. That could mean hundreds or even thousands of dollars in savings by the time you pay down your cards.
Use apps and other resources to your advantage: If using a pen and paper hasn’t been working as effectively as you would like when it comes to managing your finances, consider trying a money management app to help you automate bills, track spending, and stay on budget while you pay down your debt. We recommend Mint or YNAB (You Need A Budget).
Set Realistic Goals: In the same way that you vow to drink eight glasses of water per day, go to the gym four times a week, or volunteer twice per month, it’s important to set measurable, realistic goals for the new year. Don’t just assert “My goal is to get rid of my holiday debt”. Instead, try something a bit more specific: “I will put $200 towards my credit card bill per month in order to pay off my debt by June.” Give yourself a reward to work toward, like a massage or a dinner out on the town.
Take Out A Loan
If you really went overboard and the above tips don’t apply to your situation, there’s no shame in taking out a loan. It’s okay to need a little extra breathing room!
With RMLEFCU’s holiday loan, you can borrow up to $5,000 with as low as 7.0% APR*. Plus, you’ll have 12 months to repay, so you can put together a plan that doesn’t leave you feeling strapped every month.
Start Planning for Next Year
While it may sound counterintuitive, it’s a good idea to look ahead to next year’s holiday season. What financial management methods worked and didn’t work this past holiday season?
As you begin to put together your overall 2022 budgetary plan, we’d recommend opening a savings account that earns competitive dividends, like our Christmas Club Savings Account. This account earns up to .05% APY** and has no monthly fees.
At the end of the day, it’s important that you aren’t too hard on yourself! The holiday season is the time of year where we all want to show our loved ones how much we care through gifts, so it’s easy to get a little carried away. Being proactive now––by creating a post-holiday-season budget, taking out a loan for some cushion, or opening a Christmas Club Savings Account––is the best way to prepare for next year’s festivities while preserving your financial health.
*APR=Annual Percentage Rate. With approved credit. Some restrictions may apply.
** APY=Annual Percentage Yield