While retail and spending data for the 2015 holiday shopping season are still trickling in, it’s likely that the numbers will reflect an ongoing trend: Americans tend to overspend.
One fourth of Americans grapple with holiday-related debts, according to a recent LendingTree survey. And, 41 percent of Americans indicate financial regrets following the shopping season, the same survey noted.
This year’s results are not likely to veer from previous habits, as a recent SunTrust Bank survey found that 46 percent of respondents feel pressure to spend beyond their budget’s comfort zone. The annual survey indicated that the pressure is mounting; last year’s results showed just 39 percent of respondents felt pressure to spend beyond their means.
Over 10 percent of the LendingTree survey respondents statedthey exceed what their budget can afford by relying on credit cards or other means of borrowing money. These tendencies for funding overspending can lead to significant hits on credit reports.
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What To Do If You Find Yourself In Credit Trouble
Quizzle spoke with George Mason Law & Economics Center’s Executive Director and GMU Foundation Professor of Law at George Mason University, Todd Zywicki about rebuilding credit.
Zywicki reiterated the key to rebuilding healthy credit is also the easiest step – “Avoid inadvertent late payments,” he stated.
By stopping future dings, you can begin to rebuild your credit simply by being responsible going forward. Because late payments tend to be one of the frequent offenders to credit troubles, Zywicki suggested ensuring that those late payments become non-issues. If you have difficulties paying on time, he firmly suggests setting up auto-bill payments.
Additionally, Zywicki reminded that credit crises occur frequently because of bad habits, and rebuilding requires abolishing those tendencies. “The point is obvious,” he said, “Don’t over borrow.” Stop the cycle in its tracks and take care of the issue at hand before complicating and compounding the issue with additional debt on the back of holiday debt.
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Don’t Swear Off All Debt, Though
However, tackling debt is not the same as swearing off all debt, Zywicki cautioned. If you completely avoid credit, “you can never rebuild your credit,” he said. “Manageable debt is a good thing.”
Lewis Mandell, Professor Emeritus and Former Business Dean at the University of Buffalo and author of “What To Do When I Get Stupid” agreed, “Limit your use of actual and contingent credit,” he said, reiterating the importance of smart credit usage.
The Bottom Line
If you find yourself in financial difficulties, regardless of the time of year, stop and evaluate the situation. Be honest with yourself. By ignoring the situation and not changing your habits now, you do your future self a disservice.
You owe it to yourself and your tomorrow to act today. Take responsibility for your financial actions and get good credit.
The post Have The Holidays Pummeled Your Credit? There’s Hope Ahead appeared first on Quizzle Wire.