Key takeaways

  • Holiday spending can leave you feeling drained about your finances as the new year begins, but there are steps you can take to help your savings bounce back.
  • Cutting down spending by sticking to just the essentials for a month or two is a good start, and shopping around for lower rates with new service providers can help you even more in the long run.
  • If you’ve accrued high-interest holiday debt across multiple cards, consider applying for a balance transfer credit card to consolidate your debt and make it easier to pay off.

How much did you plan on spending this holiday season — and how much did you actually spend? The National Retail Federation (NRF) predicted that 2023 will turn out to be the highest holiday spending season on record, with sales between November and December totaling as much as $966.6 billion — a 3 percent to 4 percent increase from last year’s spending during the holiday season. Individual consumers planned to spend on average $875 on gifts and other holiday expenses.

With Americans spending more during the holiday season than ever, many may have ended 2023 with more credit card debt than they’d bargained for. If you’ve found that you spent more than you’d planned, you may be wondering how to get back on track and set yourself up for a fresh financial start in the New Year.

With the right tools and guidance, a post-holiday financial recovery is definitely still possible, helping you to make 2024 a fresh start. We asked nationally recognized consumer finance expert Andrea Woroch to share her best tips for tackling post-holiday spending and overcoming holiday debt. Here’s her advice on how to recover from the expenses of the holidays by focusing on spending less, earning more and putting your savings to good use.

Start with a no-spend month

“The best way to reset your budget after the busy and expensive holiday season is to detoxify your spending with a no-spend month,” Woroch explains. “During this time, commit to not buying anything outside your necessities.” Your necessities are likely to include groceries, housing, transportation, health care and monthly bills — and exclude expenses like takeout, new clothes and app purchases.

A no-spend month — also called a financial fast — is one of the best ways to save money fast. Committing to a few weeks of as few purchases as possible can be an excellent way to put extra cash toward a credit card bill or boost an emergency fund.

Most of us would have to make some kind of financial transaction during a month, even if it’s as simple as stocking up on milk, eggs or toilet paper. But it’s the elimination of discretionary spending that matters most.

Since there are things you will have to buy no matter what, try to shop savvy and stretch your dollars by looking for coupons and comparing prices. Woroch also recommends using money-saving apps to lower the cost of everyday purchases.

Cut unnecessary expenses from your budget

A no-spend month is also an excellent way to determine which discretionary expenses can be reduced or eliminated from your budget in the long term. “Flush the waste out of your budget,” advises Woroch, noting that a lot of people can save money by using their credit card statements to trim a budget.

You can also do things like:

  • Cut your takeout or grocery bill. After a month of at-home cooking, for example, you might decide to lower your takeout budget permanently. Use our list of money-saving supermarket tactics to reduce your food budget even further — and consider applying for one of the best credit cards for groceries to earn cash back or rewards on your food shopping.
  • Cut underused subscriptions. You might also want to consider cutting back on subscriptions, especially if your budget is currently clogged with payments to media services and app companies. Don’t want to give up your favorite shows? Consider a credit card that offers rewards on streaming services, so you can earn cash back every time you make a monthly payment.
  • Negotiate monthly bills. You can try negotiating with service providers like your cable or internet provider to lower your monthly costs. Many of these providers staff retention departments that aim to keep customers from canceling their service. If you talk to a representative — especially with a competitor’s offer in hand — they might offer a discount on your bill, even if it’s just for a couple of months.
  • Shop around for new providers. With the new year beginning, you might be able to find good rates with different auto insurance providers, phone service providers and others. By learning what other options are available, you’ll be able to assess whether you’re paying too much — and whether it’s time to switch to something more affordable.

Earn extra cash fast

Once you’ve adjusted your budget and started saving money, you can switch your focus to earning more money — through apps, side hustles and other services you can manage from home, for example.

“Replenish savings and pay down any debt faster by boosting your cash flow,” Woroch advises. Whether you start your own small business or pick up a side hustle, money-making opportunities are out there.

“There are simple ways you can make a little extra money right from home and in your spare time,” Woroch adds. Surveys and focus groups, for example, are great ways to earn extra cash — in fact, Woroch recently earned a $150 gift card by participating in a focus group about travel. If you want to improve your cash flow with surveys and focus groups, start with our list of the best survey sites to earn money.

Transfer your credit card balances

What’s the last step you can take to get your finances back on track? Consolidate any outstanding credit card debt onto a balance transfer credit card.

“If you’re carrying holiday debt across multiple accounts, you can consolidate those balances and save on interest by getting a 0 percent intro APR balance transfer card,” says Woroch.

For those who carry balances from month to month, balance transfers are one of the best ways to eliminate holiday debt, with the best balance transfer credit cards offering between 12 and 21 months of zero interest on balance transfers. “You can pay down your balances without any of your payments wasted on interest,” Woroch explains. Just be careful to pay off your balance before the introductory period on the card ends — the last thing you want is to add to your debt by accruing interest you could have avoided.

The bottom line

Your post-holiday financial recovery works best when you combine money-saving tools with other good financial practices, such as earning extra income and consolidating old debt. Consider a no-spend month to help you recalibrate your spending habits and save cash quickly.

Take a breather from spending to reevaluate your expenses to see if there’s anything you can cut and consider amplifying your income with a side hustle or new venture. While you get your finances into shape, you might benefit from a balance transfer credit card to consolidate outstanding debt and pay it off without added interest for a limited time.