How to Recover From Your Christmas Debt Hangover

The festive season has been and gone. The gift-giving and endless food and drink has given way to introspection and desperate attempts to keep the New Year’s resolutions that seemed so do-able only a week ago. However, for many Britons, the hangover isn’t limited to a vision-blurring headache, churning stomach and severe dehydration. With the average family Christmas spend equalling roughly four times the average weekly disposable income, it is estimated that British consumers will spend around £11bn over the 2009 Christmas period, with approximately 80% of that figure consisting of credit and store card transactions, hire purchase, and other credit arrangements. Alarmingly, many of these credit arrangements last a year or more, ensuring the post-Christmas hangover never really goes away.

Alcohol hangovers are unpleasant, but fortunately there are myriad cures available, from the scientifically proven to the totally bizarre, but cracking a couple of raw eggs into a milk shake won’t get rid of debt so easily. We’ve looked at some of the ways you can put a bit of ‘plink plink fizz’ back into your finances and get back in the black sooner, without resorting to ‘hair of the dog’…

Take a fresh look at your situation. Start by making a note of how much money comes in and goes out. Then break down your debts and outgoings into a list, organising them in order of importance. Naturally keeping a roof over your head and paying the bills should come first, so make sure rent/mortgage payments and utilities are top priority, but also make sure that debts with higher interest rates are placed further up the list than the ‘cheaper’ ones. Travel to work should also be considered essential. Once you have done this, you will have a much clearer idea of how much you have available to pay off your debts.

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