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How to erase that holiday debt

Hollywood, MD- It’s inevitable for millions of Americas they will find themselves in a little more debt after the holidays. Between gifts, food and travel, many people choose to splurge rather than stick to a strict budget.

If you went a little overboard this holiday season now you need to figure out the quickest way to get out of that extra debt. Last year, Americans added an average of $1,003 worth of new debt over the holidays.

Financial experts recommend making big changes to your budgeting, starting with the “snowball method” This is a popular plan pushed by financial expert Dave Ramsey.

The “Snowball Method” focuses on paying off your debt. Make minimum payments on all your debts starting with the smallest one. Once it’s gone, focus on the next smallest debt until it’s also gone. Keep going until you reach largest debt and then attack it with a vengeance, throwing all your money at it until it’s gone.

After the holidays, you need to take a good, hard look at your budget. You can get out of debt quicker if you can strip out extra spending. That might mean eating at home or avoid shopping. Others might decide to cut the cable cord or skip some luxuries, like trips to the salon, until your debt is paid off.

If you’re looking for extra cash, chances are it might already be sitting in your house. Go through your home and see what you can sell. There are plenty of online sites from Craigslist to Facebook Yard Sales were you can make a few extra bucks on your unused household items.

Finally, if you’re still struggling to catch up you might need to resort to sacrificing your tax refund. It’s exciting to think you’re going to get a nice lump of money back from the government, however, if holiday debt is still looming, you might want to consider using your refund to pay it off.

The holidays have come and gone and your money is already spent but now you have to control how quickly you can rebound. Just choose a plan and stick to it and by the next holiday season you’ll be glad you did.

Contact Joy Shrum at j.shrum@thebaynet.com

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