The holidays are a common source of financial anxiety. Whether it’s expensive wish lists from the kids or an ever-growing shopping list of decorations, treats, and supplies for holiday meals, there’s a lot of pressure to overspend.
December can certainly be an expensive month, but for many, their income isn’t any higher, and after a particularly rough year, many are already staring at growing credit card bills.
Overspending or relying on credit card bills can quickly lead to an unenviable situation, as it only gets harder to pay back bigger debts. If you’re concerned that your holiday spending is putting you deeper into the red, there is help out there. You just to find the right avenue for your particular financial situation.
How to Tell If You Need Debt Help
Financial anxiety is only one sign that it’s time to get help dealing with debt. There are other red flags that you should look out for, including:
- Missing bill payments;
- Collection actions from creditors;
- Having utilities cut off;
- Not being able to save or having no emergency funds;
- Borrowing money each month to cover essential expenses.
Debt Help Solutions
Where can you turn for debt help? There are a few different roads to take, and no solution is one-size-fits-all.
One good first step is to talk to a Licensed Insolvency Trustee. With a free first consultation, they look at your current financial situation and provide debt advice. They’ll explain solutions like debt consolidation, budgeting, bankruptcy, and consumer proposals.
Bankruptcy and consumer proposals are often seen as extreme measures for dealing with debt. Depending on your circumstances and goals, you very well may want to avoid them. If you can reasonably afford to pay back your debts, you may not qualify, and you may want to protect your credit score to qualify for future loans.
However, if you’re avoiding bankruptcy just because you’re worried about losing assets, a consumer proposal can be an effective alternative. Although they will appear on your credit report, you do not have to liquidate any assets. You can enjoy a substantial reduction in the debt you have to repay and relief from interest charges and collections.
If insolvency is still a step too far, and you’re earning enough to try to pay it all back, you can try different debt elimination methods. The most popular are:
- The avalanche method, in which you pay the monthly minimums on all accounts except for the highest-interest debt, paying as much as you can each month. This method ultimately saves you the most amount of money.
- The snowball method, in which you make minimum payments on all accounts except the smallest debt you owe. This one you pay off as quickly as possible before moving onto the next. This method is best if you struggle with motivation, as you will see results sooner.
Your path toward overcoming financial anxiety begins with finding the right debt advice.
