Get those holiday bills under control

It’s January. The parties are over, debt payments are soon due and it can feel like there’s nothing to look forward to.

You may be able to minimize the doldrums with some planning and other steps to turn things around, financial experts say.

“Financial stress can be temporary,” says Tonya Rapley, financial educator and founder of the millennial money and lifestyle blog My Fab Finance.

She suggests focusing on small steps such as paying this month’s bills, then reminding yourself that you can recover from December’s overspending.

Here are a few more ways to fight this month’s financial downers:

■ Make or update a budget. The new year is a great time to create or update a budget, which can give you back a sense of control, says Mike Croxson, chief executive of the National Foundation for Credit Counseling, a nonprofit financial coaching organization.

The popular 50/30/20 budget, for example, suggests putting 50% of your take-home income toward needs, 30% toward wants and 20% toward savings and any debt payments. You can adjust those percentages as needed, especially if you live in an urban area with high housing costs.

“The best way to get control back is to make a plan,” Croxson says.

■ Pay off debt. With interest rates higher than a couple of years ago, credit card debt is also more expensive, which makes paying it off a financial priority.

“Paying off the highest interest rate balance first makes the most common sense, but for some people, paying off the smallest dollar amount first is most important because they feel like they accomplished something,” Croxson says. Small wins can give you momentum to continue.

Online calculators for those two methods, known as the avalanche and the snowball, respectively, can help you stay on track.

■ Track your payments carefully. If you purchased holiday gifts using “buy now, pay later,” which allows shoppers to split payments into multiple installments, then it’s important to note when those bills are due, says Christine Alemany, chief marketing officer for i2c, a global banking and payments platform.

Alemany suggests tracking your buy now, pay later due dates with a financial management tool or spreadsheet to avoid late fees or interest charges.

“The variety of payment methods that consumers now have gives them the option to choose what’s best for them,” she says, but “that convenience needs to be balanced by discipline.”

■ Build up savings. Amid all of that repayment, it’s also important to find a way to save money, Croxson says. “Having a savings line item in your budget is a critical step for virtually every consumer, even if it’s $20 or $25 a month,” he says. “There will be an emergency, and you will need it.”

The good news for Americans is that positive signs in the economy, such as a slower rate of inflation and lower gas prices, mean it’s a little easier to find room for savings, according to Alan Gin, associate professor of economics at the University of San Diego’s Knauss School of Business.

With gas prices coming down, Gin says, “not only will consumers be more confident, but they will have more money.” from jobs that didn’t pay into Social Security may be subject to two provisions, the windfall elimination provision and the government pension offset. WEP can reduce but not eliminate any Social Security retirement benefit they earned from other jobs that paid into Social Security. Typically, the Social Security benefit at full retirement age won’t be reduced by more than half the pension amount.

GPO, by contrast, reduces a Social Security spousal or survivor benefit by two-thirds of the amount of the pension. That means GPO can eliminate a Social Security benefit based on someone else’s work record. If your friend can’t qualify for a divorced spousal benefit, that means she’s already receiving more from her pension than she would get from Social Security.

Benefits Checkup, offered by the National Council on Aging, at benefits checkup.org, could help her find programs that help pay for necessities.

Liz Weston, Certified Financial Planner, is a personal finance columnist for NerdWallet. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.