When you’ve caught the last scraps of tinsel floating around the house, and your New Year’s resolutions have fallen by the wayside, there’s still a final holiday tradition left to enjoy: dreading the arrival of holiday bills. Yes, this time every year, thousands of Canadians are struck with cases of Bill Avoidance Disorder – B.A.D. for short.
Have you ever avoided a statement for multiple days, telling yourself you’ll “get to it later”? Have you ever opened a credit card statement, skimmed the first line, and realized you’re just not ready to face the shame? Have you ignored your banking app notifications, or worse – deleted your app altogether? Have you ever, for even the briefest of moments, debated the ramifications of just never paying your statement at all, or throwing it out the window, or setting it on fire? Sorry to say, friend, but you might have a case of the B.A.D.s.
To bring awareness to this financially debilitating disease, we’ve proclaimed January 15th Bill Avoidance Disorder Day, and we have good news: like your holiday hangovers, B.A.D. is 100% curable. Think you’ve come down with a case? Try all of the following, and call us in the morning.
1. Track Your Purchases as You Make Them
The hardest part of opening a bank statement is fear of the unknown. If you didn’t make a budget (or you didn’t stick to it) it can be hard to remember every purchase you made during the holiday retail whirlwind, and those small purchases can really add up. Instead, we suggest keeping your receipts, tracking them in a spreadsheet or using an expenses tracking app like Mint, or checking and highlighting your online statements after every shopping trip. Taking the fear of the unknown out of your statements will make opening them much less nerve-wracking – but probably still depressing.
2. Face the Music
Planning or no planning – you have to open your statements, and you have to do it as soon as they land on your door or in your inbox. Much like a Band-Aid, the faster you do it, the less it’ll hurt. We’ve helped people at Consolidated Credit who wait weeks or months to open bills, which not only affects their financial life, but their everyday one – the magic of the holidays really loses its sparkle when you’re still paying off gifts from two years ago. If you need moral support, get a spouse, significant other, or a friend on the phone to open them with you. Adding someone else to the mix will also motivate you to be accountable in your debt.
3. Make a Payment
There’s a good chance your credit balance is significantly higher than usual, and when this happens, it’s important to make the largest payment you can afford. That might mean scrimping on non-essential items like entertainment or meals out, but we recommend cutting as many costs as you’re comfortable with when your principal balance is high. Not only will it move you toward a zero balance faster, but your remaining interest payments will be significantly reduced. If paying more than one card, start with the one with the highest interest rate, and you’ll be making principal payments much faster.
4. Talk to a Counsellor
All of this advice is easier said than done – so if the spouse or bestie you reeled in during Step 2 wasn’t helpful, a non-profit credit counselling service can be a great place to start. Especially if your holiday debt is stacked on existing debt, credit counsellors can help you consolidate all your cards into one low, monthly payment – no more juggling or B.A.D. Many people think you have to be thousands and thousands of dollars in the hole to benefit from counselling, but that’s just not the case, so schedule an appointment today.
B.A.D. 2015 may already be upon us, but you can work to avoid it in 2016 too. Put away as much as you can afford, whether that’s $10 or $100 weekly. Much like those January gym visits, it might be a pain now – but you’ll thank yourself later.