January can be a month of regrets.
By the time the New Year rolls around, we begin to realize that, over the holidays, we ate too much, we drank too much, and we shopped too much. At this point during the year, your holiday spending can come back to haunt you like the ghost of Christmas past, keeping you up late at night and reminding you of the money mistakes you made in a frenzy of purchasing and celebrating.
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But, January is also a time of new beginnings, a chance to turn over a new leaf in a new year. So, what can you do now to recover from the holiday spending hangover you may be experiencing? Here are a few tips.
1. Cut back on your dining out and entertainment expenses. Because this is the time of year when lots of people are focused on diet and exercise, it’s a great time to cut your budget in the areas of dining out and entertainment. Eating at home will save you dollars and calories, and instead of buying expensive entertainment, you can do something free and healthy, like taking a walk. Put the dollars you save toward your holiday bills.
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2. Re-examine your total budget. Give your budget a New Year overhaul and find other places, in addition to eating out and entertainment, to cut back, as well.
3. Don’t continue to accumulate additional debt. This is a great time to start simplifying. Resist those post-holiday sales. Don’t buy extra things to clutter up your life.
4. Use your tax refund to pay off your holiday debt. If your holiday spending has put you in a tight spot, consider using your tax refund to get a clean slate. (Just be sure you don’t make a habit of it. You’ll normally want to use that money to build your savings instead.)
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5. Learn from your mistakes. This may be the most important step. If you overspent last year, reflect on what you can do differently this year. It’s easy to get caught up in the spending when the holiday season is upon us, but try to remember that January feeling before you pull your wallet out next year.
6. Remember: It’s never too late to fix your finances. It does take effort and commitment, but it’s well worth it. Put the holiday spending spree behind you and make a resolution to practice good money management in the New Year.
Clare K. Levison is a certified public accountant and author of Frugal Isn’t Cheap: Spend Less, Save More, and Live Better.
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