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With the holiday season upon us, it’s easy to go over our budgets. There are family get-togethers, holiday parties and gifts for our loved ones, but all of that can add up quickly, leaving us with a pile of debt in the New Year.

To help you pay off holiday debt, or other outstanding debt that’s built up over the years, here are a few tips for chipping away at your payments so that you can become debt free next year.

Get Organized

The first thing you should do is organize your debt based on the source and the rate you’re being charged. If the extent of your debt is simply your mortgage, that’s not so hard. However, if you have multiple types of like credit card debt, student loans, etc., you’ll want to create a list detailing the types of debt you have and the interest rate each type carries.

Prioritize Which Debt to Pay Off First

Creating this list will aid you in creating a hierarchy for debt repayment. As a general rule, we recommend people pay off debt in the following order: credit card debt, student loans, auto loans, home equity loans and finally, your mortgage. This list is a good rule of thumb, but it isn’t set in stone.

Depending on the interest being charged, the order you should prioritize your debt may vary. For example, if you’re working on paying off credit card debt from a holiday trip or gifts for your loved ones, this is one of the worst types of debt to carry because it tends to have the highest interest rates as well as potentially causing issues for you, like negatively affecting your credit score. However, if the balance you’re carrying is on a 0% credit card, then you may want to look into focusing more attention on an auto loan or your student loans.

Create a Plan to Pay it Off and Keep it Off

Getting out of debt can be difficult, but by creating a schedule and sticking to it, you may find that it’s easier to do than you expect. Some debt, like a mortgage, can be carried over the long term without major repercussions. Paying this debt off can be sped up by paying a little more than your payment due each month, but it’s not something many of us are able to get rid of quickly due to the size of most mortgages.

On the other hand, your credit card debt may be a much smaller and easier to eliminate. One of the most important elements to paying off this type of debt is to avoid adding to it. Our best advice here is to pay off your balance every month and work to live within your means, while chipping away at any extra debt you may have accrued during the holiday season, or over the years.

Talk to Your Advisor About Complicated Situations

If you have a more complicated situation, or just want to be sure that paying off any debt fits into your retirement plan, talk to your advisor. He or she is there to help you have the financial future you’ve been working for.

This article originally appeared in the Brainerd Dispatch on December 22, 2018.

Bruce Helmer

Bruce Helmer

Co-Founder, Financial Advisor and Author, Speaker and Host of the "Your Money" Radio Show

Bruce Helmer, a founding member of Wealth Enhancement Group, has been the host of the “Your Money” Radio Show for more than 20 years. He is also featured weekly on the Twin Cities CBS affiliate WCCO, and has penned three financial advice publications.