How to Get Your Finances in Order for 2017

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Better Business Bureau

It’s easy to get in to debt over the holidays. You want to spoil your family and friends with great gifts, but maybe can’t quite afford them. Credit cards seem like the easy solution, but when you receive the bill in the mail a month later you may think differently.

If you are in debt, you’re not alone. A 2015 report by The Pew Charitable Trusts found that 80% of American households hold some form of debt. However, getting out of debt, especially credit card debt, can start you on the road to financial freedom and wealth creation.

If you want to get out of debt and get your finances in order in 2017, follow these tips from your BBB:

Decide on a strategy. First, figure out how much debt you have; you need an accurate picture before you can figure out your strategy. Credit cards are known for their high interest rates – this wastes a lot of money over time. See if you can use a balance transfer offer to switch to a card with a lower rate. Just make sure to read the terms and contract very carefully – there may be big penalties if you miss a payment. If you have multiple cards, decide which debt-paying strategy is best for you. Some experts recommend paying off the card with the highest interest rate first, as it can save the most money. However, researchers from Georgetown University and Harvard recommend paying off the cards with the smallest balances first – fully paying off a card will give you a sense of accomplishment and inspire you to keep going! Additionally, try sending in payments throughout the month – put the $5 you would have spent on a morning coffee towards your debt instead!

Start budgeting. Creating a written budget and tracking your spending is one of the best ways to save money and stop spending more than you earn! Note the difference between fixed expenses, needs and wants. Cut where you can, and stick to your budget as much as possible. If you have debt, include repayment goals in your budget. If you can, try to factor in retirement and emergency savings as well.

Do your research and read the fine print. When deciding on a bank, credit card or big purchase, make sure to read the fine print and the contract carefully. Making careful decisions now can save you time, money and headaches later. Research companies at before doing business with them, and check BBB Scam Tracker ( regularly to see what scams are happening in your area.

Take advantage of free tools. There are many online tools that can help you manage and reduce your debt. A great place to start is! BBB created this website in partnership with Accredited Business to help consumers evaluate their finances, learn how to stay debt free and protect their finances from scams and illegal collection calls. Additionally, you can use the free and easy-to-use debt solution tool to find options for managing your debt.

Give some things up. A great way to save money is to cut back on your spending! It’s easier to do than you think. Eat at home instead of going out, stop buying coffee in the morning and take a break from buying new electronics and clothes that you don’t need. Reorganize and clean out your living space, and try to sell what you don’t need. Instead of using your tax refund to splurge on a new item, put it straight towards your debt or savings account.

Consider an alternate source of income. The gig economy has created many opportunities for part-time work. Figure out what you’re good at, and do it in your spare time to make extra money! Whether it be photography, dog-walking or driving, there’s a need for every skill!