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Tip of the Week

Holiday Debt

Despite your best intentions to stick to a budget, sometimes last minute holiday expenses get put on a credit card. If this sounds like you, set aside a few moments this week to make a plan for getting out of holiday debt. Having the plan in mind will allow you to stop worrying about your finances and be present with your family and friends through the holidays.

And as soon as the holiday spending dust settles, you will be armed with a strategy to pay off holiday debt quickly. The more prepared you now, the faster you will be able to pay off the debt and focus on your financial goals for the new year.

Here are some tips to help pay off holiday debt:

  • Find Extra Money. Think about returning some holiday presents. Sort through your gifts and take back anything you don’t want or need. If you can’t get a cash refund, get a store credit and save it for necessities later in the year or gifts for other people.
  • Think about Selling.  Beyond new holiday gifts, look around your house and sell what you don’t want or need. January is a great time to use the one-in/one-out rule to clear your house of clutter. Look to auction sites like craigslist.org, or your local newspaper.
  • Dip into savings. While we always push the importance of savings, sometimes it is in your financial best interest to dip into savings to pay down debt. You are probably collecting a considerable less amount of interest on your savings than the interest that is accruing on your credit cards. If you’ve got more than a few months’ worth of living expenses sitting in a savings account, withdraw the extra and use it to pay down your bills.
  • Avoid post-holiday sales this year. As tempting as they may be, stay away from after-Christmas sales. Even if you’ll be getting 50 percent off sweaters, wrapping paper and holiday cards, you’re still spending cash you can’t afford to part with right now. You really aren’t saving money by spending money.

Wishing you a stress-free holiday! May you have simple, joy-filled times with loved ones.


Montana Credit Unions for Community Development (or MCUCD) is the award-winning, charitable arm of the Montana Credit Union Network. A state-wide nonprofit organization, MCUCD works together with the state's credit unions to improve the lives and financial independence of all Montanans.