How much did you plan on spending this holiday season—and how much did you actually spend? The National Retail Federation (NRF) predicts that 2021 will turn out to be the highest holiday spending season on record, with sales between November and December totaling as much as $859 billion. Individual consumers plan to spend nearly $1,000 on gifts and other holiday expenses.
With many Americans spending more than ever (and with the threat of supply-chain issues prompting impulse buys and rapid checkouts), you may end this holiday season with more credit card debt than you’d bargained for. How can you get back on track and set yourself up for a fresh financial start in the New Year? Is it possible to make a post-holiday financial recovery?
Even if you spent much more than you planned this holiday season, it’s still possible to get your finances to the point where 2022 feels like a fresh financial start. We asked nationally-recognized consumer finance expert Andrea Woroch to share her best tips for tackling post-holiday spending and overcoming holiday debt. Here’s her advice on how to recover from the expenses of the holidays by focusing on spending less, earning more and putting your savings to good use.
Start with a no-spend month
“The best way to reset your budget after the busy and expensive holiday season is to detoxify your spending with a no-spend month,” Woroch explains. “During this time, commit to not buying anything outside your necessities.” Your necessities are likely to include groceries, housing, transportation, healthcare and monthly bills—and exclude expenses like takeout, movie downloads, new clothes and app purchases.
A no-spend month is one of the best ways to save money fast. Committing to a few weeks of as few purchases as possible can be an excellent way to put extra cash towards a credit card bill or boost an emergency fund.
Some people may even be able to make it through a no-spend month without spending anything—although most of us will have to make some kind of financial transaction, even if it’s as simple as stocking up on milk, eggs or toilet paper.
“Since there are things you will have to buy no matter what, like groceries and cleaning supplies, try to shop savvy and stretch your dollars by looking for coupons and comparing prices. Woroch recommends using money-saving apps to lower the cost of everyday purchases.
Cut unnecessary expenses from your budget
A no-spend month is also an excellent way to determine which discretionary expenses can be reduced or eliminated from your budget long-term. “Flush the waste out of your budget,” advises Woroch, noting that a lot of people can save money simply by …….
Source: https://www.bankrate.com/finance/credit-cards/post-holiday-financial-recovery/
