The holidays are a time when people buy gifts for their loved ones and some may travel more than normal. This can sometimes be financially overwhelming.
Some individuals opt to put those purchases on a credit card, which means they’ll have monthly payments until the debts are paid. While this enables you the short-term satisfaction of having an expensive holiday, it may lead to trouble after the holidays are over. Here are three things to keep in mind:
1. Minimum payments don’t do much
Making only the minimum payments on the credit cards means that it will take a long time to pay them off because the minimum payment might cover interest plus a little bit of the purchase price. In some cases, the minimum monthly payments add up to more than a person can comfortably pay each month.
2. Budgeting is beneficial
Sitting down with a list of your income and expenses for each month may help you to find out if you can afford the credit card payments. If you decide to seek bankruptcy protection, having all this information will benefit you considerably. You need to meet with a credit counseling professional before filing for bankruptcy.
3. Bankruptcy might be the help you need
Determining how you will handle the holiday debt is a major decision. If you decide you’re filing for bankruptcy, be sure you understand what filing will do. You have responsibilities that come with the benefits. Working with someone who can help you to understand these is crucial because you need to make an informed decision.
