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Bottom Line Up Front

  • Holidays are the time of the year known for overspending.
  • You can keep your holiday budget intact by reviewing your financial situation on a yearly basis and sticking to your savings plan.
  • Always pay your higher interest rate credit card debt first and make the minimum payments on all your other cards. Never make a late payment.

Time to Read

3 minutes

December 1, 2022

For many Americans, winter holidays are filled with good tidings, cheer and time spent with loved ones. It can also be a time of overspending, leading to holiday debt. So, while the holidays and their festivities may come and go, retailers’ bills tend to stick around. The third Monday in January is even known as “Blue Monday” due to the arrival of bills from holiday purchases and the increasingly cold weather.

Did you get swept up in the spirit of the gift-giving season and spend more than you planned on your holiday shopping? Avoid a holiday spending hangover by following these quick tips to help get your personal finances back into shape and live a debt-free year next year:

  • Revisit and analyze your current financial state. The beginning of a new year is a great time to look over your finances and get a true sense of your monthly payments. Go through all your credit card bills and create a spreadsheet of total owed, minimum due and interest rates for each. Look at your checking account balance and see where you stand there as well. If you’re juggling multiple debts, review our Debt Repayment video for good tips and a better sense of your options. This may also be the time to consider pulling your credit report so you have a sense of your credit rating and credit score.

  • Come up with a repayment process and prioritize payments. Once you know what the interest rates are for your credit card debts, prioritize paying off the highest interest rate cards first while paying the minimum due on the others. If it’s an option, consider opening a new card that offers an introductory rate or one with a lower interest rate and transfer the balances from the higher-rate cards to the lower-rate card. You can also check with your current financial institution for special low-rate balance transfer offers and debt consolidation plans.

  • Create a budget. As you refine your repayment process, keep in mind that your credit card balances aren’t your only responsibilities. Create a new budget that takes all your spending into account, to ensure you keep up with your regular expenses, such as utilities, along with paying your credit card bills. Not sure where to begin? Navy Federal’s Budgeting Tips section can help.

  • Keep your bills top of mind. While ignorance may be bliss with some things, that isn’t the case with credit card bills. As you’re paying down your debt, keep track of outstanding balances so you can adjust your budget and planning as needed. Open bills when they arrive to make sure you have the due date and the latest information to use in your planning.

The More You Know

Keeping your finances in good standing can be rewarding, especially after the holidays. A smart plan for the New Year could help put you on track for the months ahead and be prepared for the next season of holiday gifts.

Next Steps Next Steps

  1. Create a spreadsheet of total owed, minimum due and interest rates for each credit card.
  2. Consider transferring balances to a single card, or prioritize paying off the card with the highest interest rate first.
  3. If you need help managing your debt, have a conversation with one of our personal finance counselors to create a plan to get you back on track.  


This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.