Monday, January 09, 2006

A Cure for YourChristmas Shopping Hangover

As the christmas tree goes out and the kids go back to school, the bills for your Christmas endulgences begin to roll in.

Now is the perfect time to look at all your finances and get a better understanding of where your money is going and how to save more. The first step is to list and rank ALL current debts and bills. Include balances, due dates, interest rates and minimum payments.

Prioritize your debts and focus on paying those off with high rates and low balances. Once you have cleared off the debt carrying high interest, strike that off the list and move to the next highest interest rate account.

Think about shifting any extra cash flow into paying off your consumer debt. While now is also the time for purchasing retirement savings plans to mitigate your taxes, look closely at the investment return you would need to generate in order to pay off those credit cards.

Use your New Years resolution to clean house to generate some extra cash through a garage sale or ebay. Clearing out unwanted items can be a cathartic experience and could even put some money in your pocket.
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