The holidays come with a lot of social pressure. People want to give gifts to their friends and families. They feel like they need nice outfits for religious ceremonies or office parties. There may also be pressure to travel or to host family members at their homes.
All of that adds up to a lot of financial obligations. Many Americans end up putting at least some of their holiday expenses on credit cards, a decision that often leads to financial strain that persists for many months.
Why does holiday spending often lead to financial hardship in the new year?
Americans don’t prioritize paying off their credit card debt
As long as there is still available credit for someone to use, they may not worry about putting substantial amounts of money into a revolving line of credit. Often, they then don’t have the budgetary excess to repay those newly-acquired debts in the near future.
Holiday credit card debt is a real concern in modern America. According to a report about residual 2020 holiday debt, a shocking 29% of people who used credit cards to pay for the holiday season still haven’t paid off last year’s meals, travel expenses and gifts. Overall, holiday shoppers will spend an average of $620 on credit cards and may spend months paying that amount back.
Although it can be a thrill to give the perfect gift, how they are obtained should not come at the expense of your financial comfort in the new year. Addressing credit card debt through a personal bankruptcy filing could help you regain control over your personal finances.