Holiday spending is stressful, and many Americans overextend their credit cards, take credit card cash advances, and apply for new credit during their holiday shopping. How can you recover from all of the money you spent on Christmas presents or similar shopping “obligations”?
The Simple Start: New Year Austerity Measures?
Some people cannot afford to spend much after the holiday season, others choose not to purchase. No matter whether you’re cutting your spending out of necessity or out of a desire to get a fresh start, cutting your daily and weekly costs is a bit part of beating the holiday shopping hangover.
One way to do this also helps people with their new year health resolutions; eating fresh food and avoiding pre-packaged or fast-food type meals is an important way to cut costs. Bringing leftovers from home to eat for lunch at work is one way to go, but you can also find daily deals on fresh food at many local supermarkets.
Vegetarians Know How To Save Money On Food
If you’ve never experimented with a healthier eating lifestyle, you might consider going vegetarian to save money. You don’t have to do this as a 100% full lifestyle change; try going vegetarian for your lunch meal alone and see how much you save.
Brewing Your Own To Save Cash
Bringing your own coffee to work instead of stopping at Starbucks is also a good way to save in tandem with your food choices. Consider the math: $3.45 for one tall Starbucks Caffe Mocha that you indulge in once a day adds up to just over $17 per week and $69 per month.
Obviously not everyone has a sweet tooth that demands a chocolate coffee every day, but it’s a great example of an expense that adds up over time.
Tackle Your Credit Cards Now
Those who opened new credit card accounts over the holiday spending season should consider a strategy to whittle down the new debt as quickly as possible.
Some consumers choose to target their credit cards, pulling their monthly payments on all other cards to the bare minimum while paying off the lowest balances as quickly as possible, then moving on to the next lowest credit card balance and overpaying on that each month until the balance is gone.
This is a strategy that can work well depending on how much debt you carry and how much you can overpay on the lowest card. But one thing that is critical to know about this? If you feel the temptation to cancel a credit card account, make sure it’s the most recent one you’ve opened.
The age of your credit accounts can actually help your credit score. Closing accounts you have a long history with is a bad idea with that in mind. Close the accounts you opened out of necessity in the holiday shopping frenzy, but keep your “legacy” credit accounts.
Joe Wallace specializes in personal finance, military affairs, and consumer protection topics. Since 1995, his work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and collects unusual vinyl records, which gives him an excuse to write the vinyl blog Turntabling.net.