woman-carrying-holiday-giftsRecovering from holiday-related spending and overs-spending can be challenging, especially if you’ve accumulated debt during the festive season. However, with careful planning and the right strategies, you can get your finances back on track. For many, enrolling in a Debt Management Plan (DMP) can be a crucial step towards financial stability. Here’s a guide to help you recover from holiday spending blues:

Assess Your Financial Situation

  1. Review Your Spending: Start by reviewing your holiday expenses. Understand where your money went and identify any unnecessary spending.
  2. Check Your Debts: List down all the debts you’ve incurred, including credit card balances, loans, and any other obligations.
  3. Create a Budget
  • Income vs. Expenses: Make a budget by listing your monthly income and expenses. This will help you understand how much you can allocate towards debt repayment.
  • Prioritize Expenses: Focus on essential expenses like rent, utilities, and groceries, and cut back on non-essential spending.

Set Up a Repayment Plan with Your Creditors on Your Own

  1. Prioritize High-Interest Debt: Pay off debts with the highest interest rates first, as these cost you the most over time.
  2. Extra Payments: If possible, make more than the minimum payment on your debts to reduce them faster.

Explore Credit Counseling

  1. Professional Guidance: Credit counselors can provide personalized advice on managing debt, budgeting, and improving your financial situation. They can also offer a Debt Management Plan, which we will discuss below.
  2. Educational Resources: These services often include workshops and resources to help you develop better money management skills.

Consider a Debt Management Plan (DMP)

  1. Understanding Debt Management Plans
  • What is a DMP? A Debt Management Plan is a structured plan created in partnership with a credit counseling agency. It consolidates your unsecured debts (like credit card debt) into one monthly payment, often with reduced interest rates, lower monthly minimums, and waived fees. The agency will help you set up a plan to pay off your debt within 3-5 years.
  • How Does it Work? When you enroll in a DMP, the credit counseling agency communicates with your creditors on your behalf. They agree on lower interest rates and a fixed monthly payment that you can afford.
  1. The Benefits of a DMP for Holiday Overspending
  • Simplified Payments: Instead of juggling multiple payments, you make a single payment to the credit counseling agency, which then distributes it among your creditors.
  • New Terms: These agencies have preset benefits in place with your creditors that offer much lower interest rates, reduced monthly minimum payments, and waived fees.
  • Avoiding Further Debt: With a structured plan, you’re less likely to rely on new credit, preventing further debt accumulation.

Avoid Accumulating New Debt

  1. Use Cash or Debit Cards: Try to pay with cash or a debit card instead of a credit card to avoid overspending.
  2. Emergency Fund: Start building an emergency fund to avoid relying on credit for unexpected expenses.

Reflect and Plan for Next Holiday Season

  1. Learn from Experience: Reflect on what led to overspending and how you can avoid it in the future.
  2. Start Saving Early: Begin setting aside money each month for next year’s holiday season to prevent a repeat of the situation.


holiday-gift-wrapped-with-lights-in-backgroundRecovering from holiday spending requires discipline and a strategic approach. By assessing your finances, creating a budget, and considering debt management solutions like a Debt Management Plan, you can steadily work your way out of debt. A DMP can be a powerful tool in recovering from holiday overspending by offering structured payments, interest rate reductions, and a clear path out of debt. Remember, the key is to stay consistent with your plan and avoid accumulating new debt. With time and effort, you’ll regain control of your finances and be better prepared for future holidays.