Did you use a credit card this past Christmas? You are not alone. On average, people spend approximately $1,000 on Christmas while carrying credit card debt of $9,000 to $12,000. So chances are better than even that most, if not all, of that $1,000 was on credit. What about you? Did you go deeper into debt this past Christmas?
How to beat your Christmas debt
First of all, don’t beat yourself up. Wanting to spend money to buy presents for family or friends isn’t a character flaw. Generosity is a GOOD thing but sometimes we need to take a different approach to it. Let’s look at a few ways to beat your Christmas debt and make plans to insure that next year’s Christmas is debt free. Generosity plus financial good sense makes you feel a lot better.
1. Sell some excess stuff
Opportunities are all over the place from Craigslist to eBay to auction sites galore. Don’t neglect your local newspaper though … ours allows you to list any item free if its prices is less than $100.
2. Make some extra money
I’ve written several articles about making extra money:
- 26 Ways To Make Extra Money And Keep Your Day Job
- New Ways to Earn Extra Money
- 10 Businesses You Can Start for Peanuts (or less!)
- Need Extra Cash? There Are Only 4 Ways to Get It
- Mining the Miners: A Different Way to Make Money
So long as you use the extra cash you make to pay down your Christmas debt, you’ll be able to beat it. The problem is always that we want to spend what we see as “excess” cash.
Don’t.
As soon as you receive any extra money, use it as soon as possible to pay down your debt. Read 17 Sneaky Savings Strategies for more ideas.
3. Move your credit card debt to a lower interest card
The best option here is The Discover-it Card because of the lower interest rate and cash back programs. You can make a lot of progress on credit card debt when there’s no interest involved. If that card doesn’t strike your fancy, head over to my Credit Cards page for many other options.
4. LOWER your interest with a peer-to-peer lending company
Your two options are:
Both offer rates better than your average credit card and both have moved from mere curiosities to lending powerhouses. Prosper and Lending Club both will loan tens if not hundreds of millions of dollars this year. Both claim that the vast majority of their borrowers use the money to pay down their credit card debt. You really aren’t alone!
Rates for borrowers are LOWER than you can believe! Check out Prosper HERE!
5. Take on an extra job
Kind of a yucky option, but it’s one you may have to consider if you want to beat that Christmas debt.
6. Move your checking account to PerkStreet
PerkStreet is a checking account that pays you debit card rewards similar to credit card rewards. Paying you up to 2% on all your non-pin debit card purchases can mean an additional $600 or more to you for next Christmas. For a huge number of PerkStreet customers, Christmas of 2011 didn’t mean debt because they used their debit card rewards to pay for it.
Move YOUR checking account to PerkStreet and make certain that Christmas 2012 is debt free … paid for by debit card rewards from your PerkStreet checking account.
7. Save a tiny amount from each paycheck in an online savings account
I use two main banks for my online savings:
No matter how small the amount, saving just a little from each paycheck for next Christmas will mean less stress in a few short months. It’s like a gift you give yourself. Set it up to be automatic and you’ll never miss that cash.
Make the right choices now
By taking a few minutes to make some changes now, next year your Christmas can be a lot more enjoyable … and it can be completely debt free.
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Good tips but moving to a 0% card isn’t free. Usually they come with a 3-5% transaction fee
Sure, no loan of any type is “free” but the 3% balance transfer fee is peanuts compared to the average interest rate people pay (currently averaging 15%). Discover requires a minimum payment of 2% of the balance and a 3% balance transfer fee. The average person having a credit card and maintaining a balance today is roughly $16,000 so the balance transfer fee would be another $480 in debt added on to your balance but after 18 months, you would save around $3,600 in interest. I’ll spend $480 to save $3,600 any day.