Getting out of holiday debt and planning future savings

Getting out of holiday debt and planning future savings

PINE BELT (WDAM) - The financial holiday hangover is here. We looked at how you can get yourself out of that debt you may have accrued this holiday season and ways to plan for the future.

According to U.S. News, now is the time to avoid post holiday sales and curb your shopping habits. Strip your budget to the bare bones, and cut down on your normal monthly spending. You can then use the extra cash to pay off bills.

You also may want to pick up a second job, so some extra money is coming in until you have your debt paid down.

We also looked at what you can do with the cash you may have received as a gift this holiday season.

"Generally, there are three things a person can do with holiday money they receive. The first is to just save it. Emergency savings is always a good idea," said Capital Advisors Financial Advisor Brady Raanes.

Raanes said his team recommends three to six months of emergency savings in case you need it.

"Secondarily, if that's covered, then kids college is always a wise move to stock some money aside. The third area we see a lot of is retirement plan savings," said Raanes.

Even a small amount can go a long way.

"Even if you don't feel like it's a whole lot of money, even if it's just a few hundred dollars. The earlier you can get going and save the more it will benefit you down the line," Raanes said,

Once you are out of shopping debt, it's a good idea to start planning early for next year's holiday season spending so you don't end up in the same debt predicament. Start saving at the start of the new year.

"It really makes all the difference in the long run. The earlier you save, the longer your money has to compound and grow on top of itself," said Raanes.

According to National Debt Relief, at least $1 trillion was spent this year in retail sales and more than $100 billion in online sales.