The holiday season is just around the corner. Retail stores have started stocking their shelves with holiday gift items in hopes that consumer spending will be up this year. Many consumers are excited for the shopping season to kick off as well, but that may give rise to a problem: holiday-related debt. While many think of this time of year as a time to cut loose and relax one’s hold on funds a little bit, it is also a great time to develop a plan to pay off credit card debt.

Many Wisconsin residents turn to credit cards for holiday purchases and, in some instances, to buy necessities. In fact, one report states that 38 percent of households carry credit card debt, averaging more than $16,000. This type of debt can quickly grow, causing significant financial hardship. So, how does one go about paying it down, particularly after the holidays?

Experts offer several options. The first, snowballing, is where the debt-holder pays off the smallest credit card balance first while only making minimum payments on other cards. The hope is that this will build momentum in paying off credit card debt. Another option is referred to as the avalanche. Here, the card holder pays off the card with the highest interest rate first, in hopes of saving money on interest that he or she will not have to pay. A third option is to pay off debt in a way that is between the snowball and the avalanche, essentially paying all cards down at the same time.

Though these tactics might help alleviate some personal debt, sometimes the debt being carried is just too overwhelming to handle. When this is the case, it might be time to seek legal options for debt relief, such as bankruptcy.

Source: The Pittsburgh Post-Gazette, “Plan ahead to combat holiday credit card debt,” Patricia Sabatini, Oct. 22, 2015