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5 Ways to Pay Off Holiday Debt Faster


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Americans set a new record with their holiday debt: It’s now the lowest it’s been in six years.

Online marketplace LendingTree has been polling Americans on their holiday spending since 2015. The results of its latest holiday debt survey shows a 34% drop from $1,549 last year to $1,028 this year.

This may sound like a positive turn of events. But LendingTree’s chief credit analyst Matt Schulz isn’t convinced the results show all good news.

“Debt can be a sign of financial confidence,” he says. “Someone who feels great about their financial situation may be willing to take on a little extra debt because they know they’ll be able to pay it off and aren’t worried about paying a little bit of interest. On the other hand, someone who feels shaky financially may try to minimize debt or avoid it altogether because they’re not sure they can handle it. I’d bet the latter has happened in a lot of American households this holiday season.”

If your holiday spending is making your financial life harder in the new year, there are steps you can take to pay off that debt faster. Here are five tips for kicking holiday debt out of your life in 2024.

1. Sell stuff online

Chances are you’ve got furniture, tools, lamps, bikes, and other items gathering dust in the basement or garage. Get started on your spring cleaning early by selling these items on Facebook Marketplace, eBay, or another online venue.

Even if you only bring a few hundred dollars, that can knock out a good chunk of credit debt if you apply the cash directly to a credit card payment. You may even surprise yourself and accumulate enough cash from sold items alone to pay off the debt completely.

Find out: Holiday Debt Stress: How To Beat It In One Day

2. Scrounge up extra income

There’s nothing like earning more cash so you can pay off holiday debt sooner. Take on a short-term side hustle or ask your boss if you can earn overtime at work. Then apply the earnings to holiday debt. When all is said and done, you can return to your usual schedule, or even better, work extra hours for a couple more months to save ahead for next holiday season.

3. Transfer debt to a balance transfer card

If you got carried away and racked up more holiday debt on a high-interest credit card than you can pay off in a few months, consider transferring the balance to a new card with an introductory 0 percent APR for a year or 18 months. Then pay enough each month to get to a zero balance before the 0 percent APR expires.

You’ll pay a balance transfer fee of around 3 to 5 percent of the transferred balance, so first make sure that fee won’t exceed what you’d pay in interest on the old card. Stay away from making new purchases on the new card. Then hammer away at that debt until it’s gone.

Important: Make sure you never pay late, since late payments can nix the 0 percent deal and stick you with a high interest rate and more debt woes.

Find out: What is APR and What Does It Mean for Your Debt?

4. Prepare most meals at home

Americans spend an average of $3,500 dining out every year, says the latest BLS data. That amount comes to nearly $300 a month, in addition to weekly groceries. If you cut back on dining out, prepare most meals at home, and take your lunch to work a few times a week, you can apply your savings to holiday credit card debt.

Sure, it’s a sacrifice, but one that’s well worth the effort – especially since dining out would probably add even more debt to the credit card balance you’re trying to eliminate.

You may appreciate having extra money so much that you continue mainly eating at home so you can save for large purchases and major goals like buying a house, going back to school, or starting a family.

Find out: Holiday Debt Hangover

5. Go on a spending fast

A “spending fast” may sound extreme, but it’s mainly just living within your means. Right now, you can’t afford your usual lifestyle if you want to pay off holiday debt and save money on credit card interest. So, vow to cut back for a couple months on expenses and then apply your savings to holiday credit card debt.

Your spending fast may include pausing all but one streaming channel, preparing most meals at home, planning errands so you use less gas, and adjusting utility usage for lower bills. It might mean you shop only at discount grocers and don’t buy new clothes for a month or two.

Start out small, committing to a month-long spending fast. Once you’ve got the hang of it, you might add another month or two, saving plenty of money to go towards holiday debt.

Need a little more help? Start the New Year off right. Debt.com’s expert counselors can set you up with the right solution to your debt problem.

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