Are you suffering from financial hangover?

The first few months of the New Year are often bleak ones when it comes to finances, with many people having overspent on lavish gifts, rich foods, and an abundance of outings over the festive season.

Many of us tend to spend, spend, spend when it comes to the Christmas and New Year season, getting caught up in the excitement and atmosphere of it all. It is only when the bills and credit card or bank statements begin to arrive over the course of January that we suddenly realise just how much we have blown.

This is why many of us spend the first few months of the year trying to recover from the financial hangover, much in the same way as someone that has been out partying, drunk too much, and woken with a thumping headache and terrible realisation of what they have done.

Struggling to manage your finances after one of the most expensive times of the year can be frustrating and annoying, but for most of us dealing with our finances in the New Year is a necessity in order to get back on track.

The last thing that you want is to be stuck trying to recover from your financial hangover for months on end, as you will have a very bleak year ahead of you otherwise. The quicker you can address and sort out your finances the better it will be for you.

For example, if you have spent a load of money on your credit card over the Christmas season you can look at switching to a 0% balance transfer card if you are being charged interest. If you used a 0% purchase card to fund your purchases try and pay off as much as possible each month so that you get rid of the debt more quickly, and clear it all before you start getting charged interest.

It is important to review all of your income and outgoings in order to arrange your budget to help you get over the financial hangover. Many people make sorting out finances their New Year’s resolution, but sadly a good many of us forget all about it. However, taking the time to sort your finances could make the rest of the year much brighter, and could lead to far healthier finances for the rest of the year.

What you don’t want to do is to be one of the thousands of people expected to become insolvent during the first quarter of this year purely because of the amount that they spent over the Christmas period. One industry expert stated: “Sadly, many individuals spend up on credit at Christmas and pay no heed to the financial warning bells. Come January, they find themselves in a situation where previous financial woes are compounded by the bills arriving from the festive season and in these situations insolvency becomes the only way out.”

Insolvency is no quick fix solution and can affect your life for years to come, so should only be considered as a last resort. If you are able to do so then you should run a financial health check on your income and outgoings and see where you can make cutbacks or changes to repay your Christmas debt more quickly.

This will enable you to get your finances back on track as quickly as possible, and will mean that your long term financial future is not put at risk.

There are a number of ways in which you can try and tackle the financial hangover. You can look at making cutbacks to your outgoings, getting rid of any luxuries such as subscriptions and memberships, cutting back on shopping for clothes and going out, and shaving as much as possible off non-essentials.

The odd few pounds here and there can quickly add up, giving you more money to whack towards your credit card bills and debts.

You may also want to consider looking at things like your car insurance, broadband, mobile phone, and utilities, as you may be able to get cheaper services with another provider, which in effect could save you a fortune depending on how many services you switch due to cheaper prices.

Again, all of this means extra cash for your debts, and you can quickly find the best deals on these services by using one of a number of price comparison sites.

If your finances are too tight to make any cutbacks then there is another alternative, and that is to increase your income rather than decrease your outgoings. Look at taking on a second job, or wherever possible working overtime at your work. Even if you only do this on a short term basis, it will enable you to earn some extra cash towards your Christmas debts.