The holiday season is a great time to place your focus on your family. Many do this by surprising loved ones with nice gifts that they normally wouldn’t purchase for themselves. Others prefer facetime with loved ones over the holidays, traveling across the country to gather in person. Of course, there are also many people who choose to do both of these things.
Now that the holidays are over, the bill is about to come due. Plane tickets can be expensive, as the holidays are typically considered the peak travel season. Between travel costs and gift expenses, you may be looking at the amount you owe and wondering how you will fit it into your budget.
If this describes your situation, you’re not alone:
Approximately 36% of Americans took on holiday debt this year
The average amount of holiday debt was $1,249
Fortunately, there are solutions available to help you pay off your holiday debt faster without busting your monthly budget.
Common Ways People Finance Holiday Purchases
There were four common ways that Americans financed their holiday purchases this year:
62% used credit cards to pay for at least a portion of their holiday expenses
33% took advantage of buy now, pay later options from retailers
27% used store credit cards for at least some of their purchases
23% took out holiday personal loans
Regardless of the method you chose, the end result is the same – additional debt that you didn’t have before the holidays. In most instances, these purchases will not be paid in full right away. Approximately 82% of individuals incurring holiday debt have indicated they won’t be able to pay it off within one month. Depending on the interest rates associated with your holiday purchases, this debt can potentially get prohibitively expensive if you carry it for a long period of time.
Common Solutions for Paying Off Holiday Debt
There are two common solutions used by individuals who don’t want to carry high interest debt for months while making minimum payments on their holiday purchases:
0% balance transfer credit card – If you can find a credit card that offers 0% balance transfers, this can be an effective way to give yourself extra time to pay off this debt without incurring excessive interest fees. Many of these cards will offer no-interest periods for up to 21 months, making it much easier to fit these purchases into your monthly budget. Just make sure you read the fine print to know about any fees or deadlines associated with these balance transfers.
Personal loan – While you won’t be able to find a loan at 0% interest, this can be an effective solution for consolidating holiday debt (as well as other debts you may be carrying) if the interest rate of your personal loan is lower than the interest rates you’re currently paying on your debt. As an additional benefit, consolidating multiple debts into a single personal loan payment can help you streamline your finances.
Refinancing Your Auto Loan My Provide a More Effective Solution to Reduce Holiday Debt
Credit card balance transfers and personal loans may make it easier to fit these payments into your monthly budget while reducing the overall interest you pay over the life cycle of your debt. However, these solutions generally don’t help you pay down your holiday debt much quicker.
If you’re still making payments on your vehicle, you may have another solution available. By refinancing your car loan, you can free up disposable income, allowing you to pay down your holiday debt faster. Depending on the terms of your car loan refinance, you may be able to:
Lower your monthly payment, allowing you to put more money towards your holiday debt
Lower your interest rate, reducing the overall cost of your car throughout the life of your loan
Skip a payment, allowing you to put all of that money towards paying down your holiday debt
iLending Makes Car Loan Refinance Easy
You may be thinking that refinancing your car loan is much more of a hassle than transferring your credit card balance to a new card. However, when you work with iLending, the process is quick and easy. Our exclusive You First Approach™ takes the hassles out of car loan refinance while ensuring you have an exceptional experience throughout every stage of the process.
As part of our unique You First Approach™, we:
Invest the time necessary to get to know you and understand your specific goals associated with refinancing
Assign you a personal loan consultant who will assist you through the entire loan process, providing you with the high levels of attention you deserve
Scour our extensive network of nationwide and local lenders to identify the best loan solutions for your needs
Review your options in detail to help you make the right decision
Complete all paperwork for you to make the process as easy as possible
Contact us today to get the car loan refinance process started.
What would you do with an extra $133* in your pocket?
