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Steps for Addressing Holiday Credit Card Debt

Jan 2, 2023

Steps for Addressing Holiday Credit Card Debt

Welcome to the new year! Congratulations on making it through another busy holiday season.

If you’re like many Americans, however, you’ve put a lot of purchases on your credit card – or even credit cards – during November and December and pledged to resolve it in the new year. Now that it is the new year, it’s time to take a closer look at your credit card debt and start planning on how to deal with it.

We’ve broken down some steps you can take to make it simpler.

Step One: Assess Your Debt

Once you see how much you owe, take a few minutes to do some budgeting. (Need help figuring out where to start? Check out our article about budgeting!) Take a look at your rates as well – credit cards can have some pretty high interest rates, with the average on current accounts being 16.27% APR*. And if you used a store credit card, that interest rate can be even higher.

Odds are, if you’re no longer enjoying a low introductory rate, making the minimum payment on your card or cards each month will do little to help you actually pay down your debt. Budgeting will help you figure out how much each month you can set aside for this debt while accounting for your usual expenditures.

Step Two: Consider Your Options

In general, there are two popular ways to start paying down multiple debts: the snowball and the avalanche. The snowball method starts at your lowest balance and rate, rewarding you quickly by paying off your smallest debt first. The avalanche method starts at your highest balance and rate, focusing on getting rid of the debt that’s hurting you the most first.

Debt consolidation and balance transfers may also be a good option for you. These options essentially use another loan or credit card to pay off the existing debt in exchange for better rates or terms or a simpler monthly payment.

Specifically, a balance transfer can help you take advantage of a special low rate on a different card, allowing you to replace a high interest rate or even consolidate multiple credit card debts.

Before you jump on a balance transfer offer, however, make sure you’re actually going to save money. Here are some things to consider:

  • Balance transfer fee: Many cards with low introductory offers require a balance transfer fee of typically 3% to 5% of the amount you’re transferring. Look for cards that don’t include this fee – such as our own Visa Credit Card.
  • The interest rate on transferred balances: This is typically lower on cards designed specifically for balance transfers. Keep in mind, cards often have different, higher rates for new purchases.
  • The length of the promotional period: Make sure your promotional rate lasts long enough for you to pay the balance off.
  • The annual fee: If you’re paying a yearly fee for a card when you weren’t before, this could quickly negate any savings you’d get for transferring.

Step Three: Take Advantage of Opportunities

Once you’ve considered your options, it’s time to take a closer look at special balance transfer promotions that may help you.

Balance transfers made from now until March 31 to a Honda FCU Visa® Credit Card will enjoy a rate of 2.99% APR* for 12 months, making it a great opportunity to save money. Both Honda FCU Visa Gold and Classic Credit Cards come with:

2.99% APR* on balances transferred between now and March 31, 2023**
APR* as low as 9.90% (Gold) or 10.50% (Classic) on new purchases
No Annual Fee
No Balance Transfer Fee
No Cash Advance Fee
 This offer is open to both existing cardholders and new cardholders. Apply online or talk to us to get started!

Step Four: Make and Stick to Your Game Plan

All these options and opportunities won’t help you conquer your holiday credit card debt unless you’re putting in the effort. Make the plan that sounds best to you and stick to it. In general, if you’re regularly making payments higher than the minimum, your debt won’t seem so intimidating.

Need some more advice? Check out our free financial wellness hub for more tools and tips. With the right game plan and opportunity, your holiday debt will be just another memory in no time!




*APR=Annual Percentage Rate. Average rate is based on the Federal Reserve data from the third quarter of 2022.

**2.99% APR on balance transfers for 12 months from date of first transfer. Balance transfer(s) must be completed by 3/31/22. Once you take advantage of this offer, you will see a new promotional balance on your Visa statement. There is no balance transfer fee.