Here are 3 ways to pay off holiday debt quickly
Americans are expected to spend more on the holidays this season than ever before. Here's how to pay off debt. (iStock)
Many Americans go all out during the holidays, and about 70% even said they typically go over budget, according to the Affirm Consumer Spend Report. And ahead of the holiday season, the National Retail Federation (NRF) predicted that holiday sales could reach an all-time high.
Holiday shopping sales in November and December could rise between 8.5% to 10.5% to a total between $843.4 billion and $859 billion, according to NRF. This is up from 8.2% in 2020, which was an all-time high in holiday spending growth.
"There is considerable momentum heading into the holiday shopping season," NRF President and CEO Matthew Shay said at the time of the forecast. "Consumers are in a very favorable position going into the last few months of the year as income is rising and household balance sheets have never been stronger. Retailers are making significant investments in their supply chains and spending heavily to ensure they have products on their shelves to meet this time of exceptional consumer demand."
If you spent too much on the holidays, you could consider taking out a personal loan to help pay down or consolidate high-interest debt. Visit Credible to enter your information and find your personalized rate without affecting your credit score.
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How to pay down debt quickly
With the predicted surge in holiday spending, it is important to find ways to pay off any debt that accrued during the season. And there are steps consumers can take to pay back creditors beyond making more than the minimum payment or using the debt snowball method. Here are a few tips to pay down debt quickly:
Use a personal loan
With interest rates at historic lows, consumers can use a personal loan to pay off high-interest credit card debt. Doing so allows them to consolidate their debt into one loan and pay it off at a lower interest rate. They will also have an exact term for when the debt will be paid off and accrue less interest over time.
But borrowers should be careful not to build up new credit card debt in the meantime, or they could be left in a worse situation financially than they were before. If you're interested in taking out a personal loan, visit Credible to compare multiple lenders at once and choose the one with the best interest rate for you.
Take out a cash-out mortgage refinance
Home prices are rising at record highs, increasing nearly 20% annually in September, according to the latest Case-Shiller report. Homeowners can take advantage of this increase by taking out a cash-out refinance to pay down other high-interest debt. With mortgage rates at historic lows, some homeowners may even be able to lower their monthly payments while pulling cash out of their homes. Visit Credible to compare lenders and choose the best option for you.
Apply for a balance transfer credit card
Balance transfer credit cards help users pay down debt by giving an introductory 0% APR for the first few months for any principal balance that's transferred over. During this welcome period, borrowers can pay down their debt interest-free. However, any new balances accrued on this card will still accrue interest. You can visit Credible to compare several balance transfer cards from different credit card companies and see which one is the best fit for you.
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Holiday spending is predicted to be up this year, driven in part by an 11% to 15% increase in online and other non-store sales, according to NRF’s forecast. If you have been spending more this holiday season and are accruing debt, it is important to have a debt repayment strategy in place. Visit Credible to speak to a lending expert and get all of your questions answered.
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