The holiday season has left many Americans with new and higher debt balances, as 36% of consumers borrowed money for their holiday spending this year.
On average, holiday debt reached $1,181 per person, up from $1,028 in 2023 but still below the $1,549 seen in 2022, according to a LendingTree survey.
Unexpected financial strain was a major factor, with only 44% of borrowers anticipating they would take on debt. Inflation and rising costs contributed to the challenge, as families sought to spread holiday cheer despite financial pressures.
Parents of young children, millennials, and individuals earning $30,000 to $49,999 were most likely to accumulate holiday debt. For many, the balances could linger well into the next year, as nearly half of Americans still have debt from last year's holiday season.
"It's not terribly uncommon to kind of let otherwise good discipline go for a few weeks over the holidays," certified financial planner Jesse Sell told CNBC.
High-interest credit cards, with many rates of 20% or more, were the primary culprits, but experts suggest strategies like 0% balance transfer credit cards or debt consolidation loans to reduce financial strain.
Tackling debt with methods like the avalanche approach (focusing on high-interest debt) or the snowball method (paying off smaller balances first) can help consumers stay motivated.
"Try to find ways to take some positives out of it and keep the momentum and focus going," Sells said.
While paying down debt may feel daunting, experts recommend breaking it into smaller milestones and celebrating small victories. But experts say the surest way to tackle credit card debt is to stop using them.
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