Nearly every Filipino partakes in the gift-giving and celebrating with friends and family during the holiday season in December. If you participate in it, then you know that this age-old tradition is famous for putting a dent in your wallet! The best way to recover easily is to avoid being the type of person who “buys now, worries later.” But if you find yourself with the issue of maxed out credit cards after some holiday shopping sprees, then you might be looking for ways to pay off your credit card debts. Here are sometried-and-tested tips to get yourself back on track after big holiday expenses!
1) Pay off your credit card debt as soon as possible. One of the first things you should keep in mind before using a credit card is that credit card debt doesn’t just add up, it also gains interest. You might not need to worry about interest when you pay your bills on time, but if you go past that you will accrue interest that compounds daily.
2) Consider a debt management plan. If you’re seriously considering tips on how to address maxed-out credit cards, chances are that you’re pretty much at the end of your rope. If you’re regularly spending near or at your credit card limit, perhaps you may need to manage your spending using a debt management plan that combines debt into monthly payments at lower interests.
3) Transfer your debt. A balance transfer card allows you to pay off your credit card debt while reducing the chances of any of that money going to new interest. Paying them off before APR fees are applied can help you avoid bigger debts. However, you need to pay them off during the introductory period and have a good credit score.
4) Track your monthly expenses. You may not realize it, but a lot of money could be going into paying off your debt that you are otherwise spending on non-essentials. Set aside a budget for every pay period, and you could find yourself paying off your credit card in no time.
5) Invest in great insurance. Even one unexpected issue like an emergency trip to the hospital can set you back on your payment plans. Before this happens, ensure you’re well protected with an insurance plan to avoid extra expenditures.
And there you have it! 5 tips on paying off debts responsibly. With enough foresight and management, great debts can be avoided, and their impact lessened. Just don’t forget to be smart when you get into the holiday spirit next time!
Planning also plays an important part in managing your finances. With proper planning and budgeting, you can avoid debts! Just like AIA Philippines, we aim to help people plan their future so that they can live a worry-free life! Connect with your AIA Life Planner by filling out the form below.
