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Holiday credit card bills rolling in? Here are 3 things you can do to pay them off

The average American racked up $1,230 in debt during the holidays, and 48 million are still paying it off. Here are a few ways to start tackling those bills.
Use the avalanche method by paying off your debt with the highest interest rate first — that will save you more money in the long run.
Use the avalanche method by paying off your debt with the highest interest rate first — that will save you more money in the long run.shapecharge / Getty Images
By Stephanie Ruhle

Are you suffering from a holiday hangover? And I don't mean the one that drove you to embrace Dry January — I'm talking a holiday debt headache.

This past year, Americans were more willing than ever to take on holiday debt. An estimated sixty percent of people who already carried a credit card balance were willing to keep racking up those charges during the season of giving. In fact, according to a Magnify Money survey, the average American racked up $1,230 in debt during the holidays, and 48 million are still paying it off.

Now it's January and it's time to tackle those bills. And, no, they won't go away if you don't open your mail. But here's the good news: You can make it work with a few simple strategies.

1. Make a plan to work off your debt

Like any good New Year's resolution, you're going to need a plan. Here are two common tactics to tackle those bills: the avalanche and the snowball. Use the avalanche method by paying off your debt with the highest interest rate first — that will save you more money in the long run.

The snowball method works the opposite way. You pay down your smallest debts first to get through them faster, because any progress is good progress.

2. Try to make a little more money to help cover what you owe

If you have unwanted gifts or duplicate items — like tech products or designer clothes — then sell them online.

Another tip? Sell those unwanted gift cards sitting in your desk drawer for cash. Here's how to sell them safely.

3. Use your credit cards to your advantage

If you have a lot of debt, you might have a lot of points or cash back offers. Use those to pay down your balance. Or, if you've used a high-interest card, you can try to transfer your balance to a card with a lower rate. Some cards even offer a zero percent APR for the first year, so shop around to make sure you're getting the lowest rate.

Be careful though — opening a new card may mean a temporary hit to your credit score.

Also, try giving your credit card company a call to negotiate a better rate. If you’re in good standing with your payment, you may have some leeway there.

NEXT: 11 ways to get in better financial shape in 2020

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