I don't know about you but I went all out last Christmas. Not only did I spend on friends and family but I even bought a few gifts for myself and took part in all of the gift exchanges I was expected to. Now, like many other Canadians, after the joy and merriment of the holiday season I've got higher-than-usual credit card statements as proof of my generosity and the headache of needing to pay down debt before interests rates add up. I know I'm not alone. On average, Canadians' personal debt levels increased by about six per cent at the end of 2012, according to a new report by credit monitoring firm TransUnion
. Holiday spending is partially to blame for the rise in consumer debt during the final quarter of the year, says Thomas Higgins, TransUnion's vice president of analytics and decision services. But enough about accumulating debt -- how do we pay it off while keeping up with life expenses? For some advice, I spoke with Pat White, executive director of Credit Counselling Canada
. Here are her tips:
1. Take Stock, Make a Plan
First, you have to sit down and look at what you owe. Then you can consider how to pay back your debt as soon as possible, coming up with a realistic game plan to do so. This might mean reviewing your expenses. There are some you can't change like rent, but discretionary costs like eating out, clothing and vacations, you can hold off on until your debt is paid down. It's important to keep in mind if you drag out paying down debt, interest rates will cost you more in the long run.