Five Gifts to Give Yourself in the New Year

/PRNewswire/ -- The holidays are a wonderful time full of having fun with friends and family and giving gifts to the people we care about. For many consumers, however, the joy of the season will soon be replaced by the stress of paying holiday debt.

"It is easy to get caught up in the excitement of giving during the holidays," said Mechel Glass, Director of Education for Consumer Credit Counseling Service of Greater Atlanta (CCCS). "But many overdo a good thing and then struggle to make even minimum payments on their credit cards."

CCCS of Greater Atlanta advises consumers to top their list of New Year's resolutions with a commitment to improve their financial outlook. To help consumers tackle what can be a stressful time, CCCS suggests following the following tips:

1. Know how much you owe. A common mistake is not keeping track of debt.
The thinking is that as long as you can keep up with the payments,
everything is fine. However, if circumstances change due to a layoff
or other unexpected event, you could find yourself unable to make
payments and in immediate financial stress. The only way to understand
what you are facing is to have a realistic picture of what you owe.
Gather all your credit card statements and other bills and add up the
total.
2. Create a spending plan. The easiest way to take control of your money
is to set out a plan for how you will spend it. This is not glamorous
and can be something of a task, but it gives you the power to decide
where your money goes. The plan should be flexible and include monthly
expenses such as mortgage or rent, utilities, food, transportation,
entertainment, clothing, etc. Make sure your expenses are not more than
your income. If they are, go back to the plan and make adjustments.
3. Pay off credit card debt. The average household has more than to $8,300
in credit card debt (Nilson Report, April 2009) and the interest paid
on those balances can be as high as $1,500 a year. Just think of what
you could do with an extra $125 a month in your budget! Stop charging
additional purchases today and make a commitment to yourself that once
you have paid off your debt, you will not charge any purchases unless
you have a plan in place to pay off the balance in 90 days or less.
Sacrifices now will mean less stress and a better financial future.
4. Build a savings cushion. Once you have paid off your credit card
balances, you should begin to build a savings cushion for emergency or
unexpected expenses or if you lose your job. Your goal is three to six
months of living expenses put aside in a savings account. With this
cushion in place, when the refrigerator stops working, your car's
transmission gives out or your mother-in-law moves in, you will not
have to put those unexpected expenses on a credit card.
5. Develop a strategy for your financial future. Set aside time at least
twice a month to manage your finances including paying bills, balancing
your checking account and analyzing your expenses. Begin thinking
about, and planning for retirement--consider when you would prefer to
retire, how much money you will need to live the lifestyle of your
choice and what you need to do now to get there. Establish a retirement
fund and contribute to it on a regular basis.


Not sure where to start? If you are feeling overwhelmed, there is help. CCCS of Greater Atlanta provides confidential budget counseling, money management education, debt management programs and other services to help consumers. Contact CCCS at 800-251-CCCS or online at www.cccsinc.org.

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