YOU'VE GOT MAIL - CURES FOR HOLIDAY DEBT HANGOVER

You promised yourself that you'd stick to your holiday budget. But you walked into the mall, got wrapped up in the season - and spent far beyond what you'd set aside. Now your credit card bills have arrived and you've got a painful "holiday debt hangover."

Many Americans spent themselves into financial trouble during the holiday season. Now, they must pay off what they purchased and still find money for first quarter expenses. If these symptoms describe your finances, you've entered the early stages of debt crisis:

• You're behind on the basics, like mortgage, rent and utilities.
• You're using credit to buy items you should be able to afford with cash, like groceries.
• You're skipping some debt payments to make others.
• You're receiving overdue notices or telephone calls from bill collectors.
• More than 20% of your take-home pay is being used to pay back credit card debt.

HOLIDAY DEBT HANGOVER GETTING YOU DOWN?

With unemployment predicted to remain at 6 percent, many Americans are expected to owe more and spend less this year. Many are also worried about their debt loads. A recent survey reported that paying off debt and losing weight are tied for the number one New Year's resolution. "Everyone can benefit from paying down debt, even if they're not in immediate financial danger," said Kim Womack, education director for Counseling Service of South Texas. CCCS offers three tips for paying down debt in a wavering economy: call your creditor, plan your budget, and make paying off debts a priority.

1. Call Your Creditor: As soon as you know you're going to have problems contact your creditors, tell them what's happened and explain what you're doing to meet your debt obligation. If you describe your situation, and you have a good credit and payment history, you may be able to negotiate a lower payment or interest rate. Remember, your creditors would rather keep you as a customer than lose you to bankruptcy or foreclosure.

2. Plan Your Budget: This simple process is key to keeping expenses in check, saving for anticipated costs, and reducing dependence on credit. List all monthly expenses, allowing also for a monthly savings amount to cover known annual costs. Carefully track spending and cut back on all non-essential purchases, especially those made with credit. "Look for ways to reduce daily spending," Womack said. "Be creative - organize a brown bag club or pot luck breakfast at work two days a week, or go to less-expensive matinee movies instead of evening shows."

3. Make Paying Off Debts a Priority. CCCS suggests "power paying" credit card debts by sending a larger than normal payment on the smallest balance until paid, then sending that extra amount on to the next smallest, and so on. IRS refunds can also be used to pay off smaller balances or select high interest accounts.

Womack also recommended credit counseling as a helpful tool. "Saying you'll live on a budget and stop charging is easier said than done. Even if they don't need a repayment plan, everyone can benefit from learning to do better things with their money," said Womack.

CCCS of South Texas is a nonprofit, United Way agency and a member of the National Foundation for Credit Counseling (NFCC). CCCS has been providing free counseling and educational services in the South Texas area since 1969. The agency also offers a Debt Solver Plan to those with severe financial problems. CCCS has numerous offices in the Crossroads, Coastal Bend and Rio Grande Valley areas. For more information, call 854-4357 or visit www.cccsstx.org.