How to Recover Financially After Overspending During the Holidays

If you’re looking at your bank account and your January credit card statements and wondering what happened to all your money between the holiday season and now, you’re not alone. For some reason, during the holidays, I get really generous and really frivolous about actually sticking to a spending limit I can afford. Ever year I convince myself that I have to get everyone an awesome gift and I have to wrap it extra pretty paper and ribbon (I’m known around my family as the person who always gives the presents with the nice wrapping job). When this haze of holiday madness is clouding my vision, I sometimes spend like a woman with a bottomless bank account. Sure, I probably sound like an loon with a shopping problem, but if you’re reading this blog, you and I both know that I’m not the only person in the world with the habit of breaking my holiday budget. So, let’s focus on how to clean up the mess. Here’s some of my tried and true money tips for recovering financially, spending less, and saving more in this new year:


Develop a Plan — Before you do anything, it’s key that you develop a plan for paying down your debt as quickly as you possible can (without dipping into emergency savings, borrowing money, etc.). There are plenty of great online resources for doing just that. Some awesome budgeting and debt-management tools that have really helped me out in the past are (a fabulous overall budgeting site) and (they help you develop strategies for getting out of debt!).

Put Your Credit Cards Away — When my credit card balance gets out of hand, I make a point of handing over my credit cards to my boyfriend and telling them to hide them in a place I’d never think to look. This means that they aren’t in my wallet and available for use whenever I want to make a impulsive buy and ensures that I’m not adding to my debt. You can freeze yours (literally), lock them away, or do what I do and pass them off to a trustworthy person.

Pay Extra Whenever You Can — Let’s be clear: NEVER EVER EVER ignore your debt. The bills won’t go away and it has the potential to ruin your credit for a very long time. So, that brings me to my next point: always pay (at least) the minimum payment. This will guarantee that you stay on the company’s good side and that the bills don’t get too far out of control. However, if you can, the best thing you can do is always pay more than the minimum. If I make an extra $100 one month, I send it to the credit card that has the biggest balance/interest rate (even if I’ve already paid the bill for the month).

Stay Out of the Stores (Online and In-Person) — One of my worst habits is going to one of my favorite stores “just to have a look.” The truth is, I’m not going to just look, I’m going to find something I want and I’ll probably end up spending money I don’t have to spare. So, when you’re facing a post-holiday debt situation, do yourself a favor and just avoid stores altogether. Unsubscribe from email lists (the deals are too tempting) and, if you have to, get someone to set up a block on your browser to keep you from visiting your favorite online sites.

Return Anything You Didn’t Use/Unwanted Gifts — If you bought something for the holidays that you didn’t end up using (paper plates, tree decorations, etc.) or if you received a gift that you can return without hurting anyone’s feelings, then go ahead and return the item. When you return something you bought your credit card, it’ll push down your balance some. When you return an unwanted gift, you’re gaining some much-needed cash you didn’t have on hand before, which you need for paying your bills.

Make Personal Sacrifices — While you’re trying to get on your feet again financially, it’s important that you realize you’re going to have to makes some personal sacrifices. This may mean you stop eating out completely, you cancel your Netflix subscription for a few months, you skip out on that concert you’ve had your eye on, etc. It sucks, but as someone who knows, you’re the only person to blame for your current situation, so you’re gonna have to bear the consequences.

Consider a Balance Transfer/Consolidating Your Debt — If you’ve racked up a sky-high balance on several different credit cards, it might be a good idea to consider consolidating your credit card debt by transferring all of your balances to one card (make sure the card you choose has a low transfer fee). This will give you one company to deal with and it give you one interest rate to keep track of. Here‘s a great article to check out if you think a balance transfer might be right for you. And here is another one that tells you how balance transfer may impact your credit score.

Focus on Paying the Debt with the Highest Interest Rate First — If you can’t transfer or consolidate your debt, then my advice is to do what the experts call “snowballing.” This means that you focus on paying down the card with the highest interest rate (or balance, if you’re still in an interest-free period) while paying the minimum to the cards with lower interest rates/balances. One the card that’s costing you the most is paid off, then focusing your attentions the high-interest/balance next card… and so on.


man and piggy bankCreate a Budget & Track Your Expenses — To avoid repeating the endless debt cycle year after year, I recommend that you start off this year with a budget. As the months go along, track your progress and expenses — it’ll help you see if you’re heading down a debt spiral and it’ll give you a solid idea what you can actually afford to spend month to month.

Use the 50/50 Trick — This is a super handy trick for those who tend to spend and save nothing. It’s easy, whenever you make a purchase that’s a non-necessity, you put the same amount of what you spent on your purchase into your savings account. It’s a great way to hold yourself accountable for your purchases and build a safety net for yourself along the way.

Use the “Frog” Method — This is a savings plan that I discovered recently, but have not actually tried yet. Like the proverbial frog that does not realize to jump out of the pot when the water is heated slowly, you learn to painlessly  save increasing amounts. This is meant to be an annual system, and it’s really simple: you save $1 week 1, $2 week 2, and so on, until the last week of the year you put away $52.  Total saved over 52 weeks, $1,378! Of course, nobody forces you increase all the way $52/a week. If after 20 weeks or even 10 weeks, you really feel the pinch, stop increasing but continue saving at that level. If you get up to $20 and continue at that rate, you’ll save $850, and at $10, you’ll save $475 in a year. Not too shabby!

Employ the Cash Method — Countless studies have shown that when a person shops with plastic they’re more likely to spend more than a person who shops with cash. How come? Well, it’s because when you swipe your card you don’t have to see your money literally going away like you do when you’re shopping with cash. So, instead of carrying plastic around in your wallet this new year, carry cash instead (and only carry what you’re budget allows you to spend for the week or month). Once the cash is gone, you know you’ve spend all you can while staying within your means.  

Open a Holiday Savings Account Now — One way to make sure you don’t end up end the same situation when the holiday seasons rolls around again is to start saving now by opening up a holiday savings account. When you create your budget, figure out how much you can afford to spare for savings and have it automatically transferred whenever you get paid. The balance will add up over the year and it’s a super easy way to not get sucked into the holiday-spending-hole yet again.


What are you’re best tips for recovering from debt and saving money? Let us know in the comments!





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Audra is a recent college graduate and an aspiring writer based in her home state of Georgia. She’s a lover of the sweetest Southern tea, warm weather, and decorating with lots of color, DIY projects, and shabby chic pieces. Her apartment living journey is still young, so she’s busy navigating the ups and downs and learning along the way. For more from Audra, follow her on Pinterest or check out her website

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Comments (1)

  1. Sarah Sarah

    Audra–this is SO helpful! I am using a few or your methods to recover as I type this out. Thanks for a descriptive and holistic article!