It's the ultimate morning after. Sometime between Thanksgiving day and the end of December, you got lost in the holiday spirit, spending all of your silver, gold and green, only to wake up on New Year's Day seriously in the red.
Don't panic. Going into debt is a drag, but it can happen to the best of us — including personal finance expert Farnoosh Torabi. Like many recent graduates at the age of 22, Torabi was $30,000 in debt and making only $40,000 a year. Now 35, Torabi is a veteran financial journalist and author who appears regularly on TV and works with Chase Slate to provide financial education. We asked for her advice on how to bounce back from a holiday hangover and regain your financial fitness in the year ahead.
1. Stop kicking yourself. You're not the first person to get irrationally exuberant during the holidays, and lots of people before you have managed to pick themselves up and set things straight.
"You know, when you're young, you want to enjoy life," Torabi told Mic. "You want to do everything, you want to experience everything," she recalled. "Sometimes you can kind of follow the herd and make a lot of financial mistakes in the process."
Peer pressure may have helped you get into trouble, but knowing that you're not alone and that others have endured similar challenges can help pull you out of it.
2. Set a greater goal. Your first priority is to pay down the debt. But focusing on zeroing out your credit card balance can be uninspiring at best and downright demoralizing at worst.
"Rather than dwell on the past, I think the best way to lift you out of that malaise and really get you motivated to make a difference in your financial life ... is to identify your goal for the new year," Torabi said.
When you're climbing your way out of a deficit, it can be hard to focus on anything beyond reaching that zero balance. But setting a reach goal can help you set your sights on what comes after and the surplus you'll start to build on the other side of zero.
"Get excited about something," Torabi said. "Whether it's the vacation you want to take in the summer, the house you want to buy in the future, the car you want to buy — get excited about a goal."
3. Prioritize and pay it down. If you find yourself staring down a heavy balance on one or more credit cards, the monthly finance charges might be painful enough. But if you're only paying those each billing cycle, you're just treading water.
"To the best of your abilities, try to pay down more than just the minimum every month," Torabi said. She recommends transferring and consolidating the debt to a single, low-interest credit card that will let you minimize paying interest and maximize paying down the principal debt.
Once you've settled on a monthly payment you can manage, map out a schedule that leads steadily to a zero balance. "Try to prioritize that debt," Torabi said. "Create a timeline for yourself, and work backwards."
4. Join the sharing economy. When you have a specific financial goal, like paying off a credit card balance, consider the other things you can do to get rid of it besides make more money at your full-time job.
"I see [young people] getting side gigs to bring in the extra money to put specifically towards the debt," Torabi said. "If you realize you need an extra $5,000 a month to make this debt disappear once and for all, then maybe it's that you take on some odd jobs throughout the months of January, February, and March through [freelance sites such as] TaskRabbit, Elance, Tutor.com, Care.com."
Whether it's carving out time for delivery runs, lending out that unused violin or proofreading documents, said Torabi, "there are lots of ways to find easy jobs in the evenings and weekends to shore up that cash."
5. Get ready for the year ahead. Whatever missteps got you into this mess are so 2015. You can only move forward, regain your footing — and make sure it never happens again.
You might break into a cold sweat at the mere thought of a credit card, but don't ignore the fact that credit cards can be a useful tool when used sparingly and mindfully. As with any other expense you charge to your card, holiday spending should be budgeted and paid for.
As you approach the holidays this year, take the opportunity to rethink the consumerism we typically associate with the season.
"Think about what you want the holidays to represent in terms of the experience you want, as opposed to the gifts and all the costs that are involved," Torabi said.
While it's important to be selective about costly social engagements throughout the year, restraint is especially important around the holidays. "You don't have to go to every party," she said. "You don't have to accept every dinner invitation."
Instead, Torabi said, "make it your goal to spend time with people and to be thoughtful. When you have that as your anchor, you're not so consumed by your shopping trips, necessarily. It's more about making time for people."