Steps to Heal Holiday Debt
While we might be planning to spend more this holiday shopping season, many of us say we hope to pay off our credit card balances faster, too. My team at Nerdwallet discovered that Americans who earn $50,000 to $74,999 say it will take 1.3 months to pay off their holiday credit card debt, compared with 2.6 months in 2014.
You can’t say we aren’t well-intentioned!
But in the event you wake up on January 1, 2016 with a greater-than-expected credit card bill and worry about paying it down on a timely basis, check out my advice in Money Magazine. It’s an oldie but a goodie. The piece provides couples specific tips for dealing with debt as pleasantly as possible (read: no fighting or finger-pointing) but the pointers can apply to all.
In addition to trimming your budget and raising cash from side jobs (think: pet-sitting, copywriting, tutoring, running errands for neighbors), refinancing your debt may be a way to give yourself some financial breathing room. A couple ways to accomplish this:
Transfer your balance to a 0% APR credit card. Chase Slate is one great example. It offers a 0% interest rate for the first 15 months, plus a $0 intro balance transfer fee when you transfer a balance during the first 60 days your account is open. (Disclosure: I’m working with Chase Slate as a financial education partner). Just be sure that you can pay off the balance in full during that introductory rate period. Otherwise you’re back to paying interest!
Consider a low-interest personal loan. If you can’t qualify for a zero-interest credit card, expand your refi strategy to include applying for a personal loan at your local bank, credit union or even online . At SoFi.com, for example, you can apply for personal loans to refinance student loans, credit card debt and even your mortgage. (The site’s created a cool infographic here detailing how much money you can save by refinancing your debt to a low-interest personal loan.) I interviewed the co-founder Dan Macklin on my podcast earlier this year. You must take a listen. My favorite quote from our conversation, “Don’t stick your head in the sand and just hope that things will fix themselves because they won’t.” – Click To Tweet