4 Ways to Tackle Your New Year’s Financial Resolutions
Many of us are excited to give gifts and celebrate the holidays with friends and family. However, once the holidays pass, we may find ourselves reflecting less on our celebrations and more on their financial impact. If you find yourself facing the reality of more credit card debt or depleted savings, know that you have the opportunity to set fresh goals for the new year, enhance your savings, and recover from holiday debt. We’ll show you how.
1. Limit Excess Spending
It may be challenging at first, but the best way to save is by pulling back on discretionary spending to help you get back on track. Dining out at restaurants less and finding complimentary entertainment options are two relatively easy ways to save money. Another way to build your savings is to generate more income by selling household items you no longer need or by picking up a side job if possible.
2. Save Automatically
You may already have direct deposit set up to send your paycheck directly to your checking account. But you may also be able to direct deposit a portion of your paycheck to a savings account. Having money go automatically to savings is a good way to help you save a percentage of your income. If you're expecting a tax refund, file early and ask the IRS to deposit electronically all or some of your refund into that same savings account.
Check to see if your bank has a digital savings tool, such as EasyUp® by KeyBank. With EasyUp, you can automatically save an amount that works for you — from 10¢ to $5 — every time you make a debit card purchase. Send the money directly to your KeyBank savings account or toward your debt.
3. Reduce Holiday Debt
Holiday debt on credit cards can generate large amounts of accrued interest over time. According to a recent survey by Affirm (conducted by Talker Research), 70% of credit card users expect to carry holiday balances into 2026, which means they will rack up interest charges on those bills. Bankrate reports that nearly 1 in 5 debtors (19%) worry they might not be able to make their minimum payments at some point in the next six months.
If you used multiple credit cards to buy gifts this holiday season, or if you have other outstanding balances, consider consolidating what you owe. There are many options, and each can combine your debts into one monthly payment to make budgeting easier.
Debt consolidation1 can potentially help you pay down your holiday debt faster by shortening the term for repayment. And it could potentially save you money over time if you consolidate to a lower-interest loan or credit card. For example, if you have a number of high-interest rate credit card balances, you could transfer them to a single card with a lower interest rate and a lower introductory APR — giving you extra time to pay off holiday spending.
Depending on your debt, you might consider consolidating it into a personal loan or preferred credit line. KeyBank offers personal loans with a fixed interest rate for predictable monthly payments. For access to a revolving line of credit with interest rates that are lower than most credit cards, explore a preferred credit line.
To see how consolidating your loans could help you save money and get out of debt sooner, use KeyBank’s debt consolidation calculator.
4. Tap Into Your Home’s Equity
If you own a home and have a larger amount of debt, you may want to consider borrowing against your home’s equity. A home equity line of credit provides a revolving line of credit and flexible payment options.
Another home refinancing option is a cash-out refinance. With this type of loan, you can refinance your home and pay off existing debt with a new loan that allows you to access cash. You may also be able to consolidate your home loan and other high interest rate debt into a single payment with a better rate.
Look at all Your Options
Your local lender can help you find the option that best enables you to take control of your holiday debt. And the timing of your post-holiday effort is important. Being proactive with your financial goals in the new year can set you on a strong course toward financial wellness over the months ahead.