Financial expert advises how best to tackle holiday debt

Cropped Photo: / CC BY 2.0
Cropped Photo: / CC BY 2.0(KWCH)
Published: Jan. 29, 2019 at 10:56 PM CST
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The holidays have come and gone, but for many, accrued debt associated with the celebrations linger.

This month, Eyewitness News spoke with a financial expert to find a good plan of attack to tackle that debt without going broke.

"The first step is, you have to open the credit card statement and read it, or open your email and read it," says Director of Financial Education for Meritrust Credit Union, Chris Wolgamott. "So many people are afraid of seeing that bill, knowing that they over spent. They kind of just push it off to the side."

Wolgamott says you need to be honest with yourself and make a list of all of your debts. Once you've taken that first step, you can start dealing with that debt incrementally, starting by paying off the lowest balance.

"I usually tell people while I'm teaching them to pay debt down, not to pay everything down at the same time, but focus on one or two, get them taken care of, and then start to tackle other debts along the way," he says.

While getting a handle on your debt is important, Wolgamott says you shouldn't leave yourself without wiggle room.

"They spend all their money paying back their debt and then they go back to using the debt again because they don't have money at the end of the month for groceries or their car payment that needs to come out," he says.

Wolgamott says it's also important to budget for your savings and to start building that up again too.

"When I teach budgeting, I really like to treat savings as an expense also," he says. "So, pay your car loan, pay your mortgage loan, your rent, you pay your utilities, you pay your savings account."

With savings in mind, he says, you can also consider setting aside money now for next holiday season.