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It’s Christmas time, and that usually means people going out and spending money like it’s going out of fashion.
There’s the office Christmas party which involves drinks and a new dress, there’s visiting Grandma, so you’ll need to get fuel and pick up a packet of her favorite biscuits, and of course the elephant in the room: The Christmas gifts.
Christmas can be a great time of year, but many Americans find themselves getting worried about finances at this time of year, and with good reason. According to Marketplace, 52% of millennials are happy to put holiday expenses on a credit card, but far fewer have any solid plan to pay it back.
A Poor Credit Score
The problem with lumping it all on a credit card is that it destroys your credit rating if you can’t pay it back. A poor credit rating can affect your capacity to get credit in the future, even when you need it.
There are ways to increases your credit score. It won’t happen overnight, and it does involve some self-discipline, but these tips should help you to begin to rebuild your credit rating so that your finances look healthier in the future.
Consolidate Your Debts
It may seem counterproductive to look at getting a loan to cover your loan, but if you can consolidate your debt and pay a lower monthly expenditure, why not?
Take a look at loan options from reputable companies like Cash Lady. These loans can help you to consolidate and start on the right foot.
Make a Budget
Once you’ve taken the first steps towards getting your monthly payments down, it’s time to consider how you’re going to afford everything else.
Sticking to a budget can be hard work, but it doesn’t have to be miserable, even home repairs and interior design can be done on a budget. Figure out what you can afford each month, what your outgoings are, and how much you’d like to have set aside and go from there.
Don’t Skip Payments
You’re already part of the way to sorting out your credit rating, the rest of the journey is up to you. One of the most vital things you MUST NOT DO is miss a payment. Missed payments will immediately impact your credit rating and send you back into a downward spiral.
Stick within your monthly budget and, if you need to, see if you can find extra work if you’re falling a bit short.
Don’t Go Cardless
Another counterproductive sounding argument is NOT to get rid of all of your credit cards.
It’s important to close down cards that are costing you money or cards that you don’t and won’t use, but do try to keep one or two, as regularly paying off a credit card will help to improve your credit rating.
Apply for Credit Sparingly
The very last tip is to apply for credit sparingly. Every time you apply a credit report is run, which has a negative impact, to begin with, so only apply for credit when you need it.