On Your Side: Tackle holiday debt
SPRINGFIELD, Mo. (KY3) -Those credit card statements from holiday shopping are arriving in mailboxes. If you bought too much Christmas cheer, On Your Side can help.
First, assess the damage. Figure out what you really owe and when it’s due. Do not ignore it.
There’s two schools of thought when it comes to tackling debt. Pay your highest interest card first. Or pay off your lowest balance card first. In the long run, you’ll save the most by getting rid of that high interest, but paying off a pesky card, might be the boost you need. You decide.
If you got a few store cards during the holiday season, that might cost you credit points.
“If you open too many credit cards within a short time frame, that will also affect your credit negatively,” said Stephanie Robb with BluCurrent Credit Union.
If you have a significant amount of credit card debt, consider rolling it into one credit card or personal loan with a no-balance transfer fee. Some lenders offer no interest fees for the first six months to one year.
Review what you spent. Most, forget to calculate travel and pet boarding expenses. Set goals for next season.
“Personally, I have a separate savings account. That I have money direct deposited into it from my paycheck. I never see it. I never touch it. I never spend it. That’s going to be your best option come November when you’re ready to buy those gifts you got money stocked away for it,” said Robb.
One phone call can go a long way. Many lenders will waive a late fee if you call, explain your situation, and agree to pay a certain amount by a new deadline. Be nice and honest, companies want to work with you and make a plan. If this is an ongoing problem, consider working with a credit counselor.
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