--- title: Half of Americans Plan to Take on Holiday Debt. Here’s How to Avoid It description: Many Americans' holiday spending for gifts, travel and more will wind up on credit cards. These tips can help you avoid debt. authors: - name: Liliana Hall role: Reporter url: https://money.com/author/liliana-hall/ bio: Liliana Hall joined Money in 2025. She is an Austin-based reporter for Money, where she covers a range of topics, including financial news, policy, banking, investing, passive income, financial planning and student loan debt. education: University of Texas at Austin at_money_since: 2025 articles: 134 covers: - Shopping - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Retirement - Taxes social: - https://x.com/lilihallllllll - https://www.linkedin.com/in/liliana-hall/ editors: - name: Kaitlin Mulhere role: Editor url: https://money.com/author/kaitlin-mulhere/ bio: Kaitlin Mulhere is an editor at Money.com. Since joining in 2015, she’s written and edited about a variety of personal finance topics, including banks, credit, student debt, saving strategies and more. education: University of Florida at_money_since: 2015 articles: 217 covers: - Shopping - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Retirement - Taxes social: - https://twitter.com/KMulhere - https://www.linkedin.com/in/kaitlin-mulhere-64503048/ published: '2025-11-18T15:25:28.000Z' modified: '2025-11-18T15:25:28.000Z' section: Shopping word_count: 964 canonical: https://money.com/how-to-avoid-holiday-debt/ type: Article source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Photo-illustration of two gifts wrapped in money](https://img.money.com/2025/11/News-Holiday-Gifts-Travel-Debt.jpg) As the holiday season fast approaches, many Americans are already bracing for a [financial hangover](https://money.com/new-year-resolutions-money-mistakes/) that could last well into the new year. Gallup's latest [holiday forecast](https://news.gallup.com/poll/697061/holiday-shoppers-plan-spend-briskly.aspx) shows Americans plan to spend about the same on gifts this year as last year — though the average amount ($1,007) is near record highs. A new survey from the American Institute of CPAs (AICPA), meanwhile, finds that nearly half of the people planning to spend on gifts and travel expect to take on debt to do so. That's despite many saying they intend to rein in spending, in part because higher prices may mean [shoppers are spending more](https://institute.bankofamerica.com/content/dam/economic-insights/consumer-checkpoint-november-2025.pdf) even if they're buying fewer items. Between gift-giving, end-of-year parties and traveling to visit family, the holidays are a perpetual budget-buster. But this year, many Americans are already stretched thin thanks to higher prices on everyday essentials, with about 24% of U.S. households living [paycheck to paycheck](https://institute.bankofamerica.com/content/dam/economic-insights/paycheck-to-paycheck.pdf) in 2025 — a small uptick from last year. That means holiday spending could add financial stress on consumers who are already feeling overburdened. For many shoppers, that spending will land on credit cards. According to the AICPA [survey](https://www.aicpa-cima.com/news/article/aicpa-holiday-spending-survey-reveals-budgeting-debt-and-a-bit-of-regret), roughly 79% of people planning to spend on gifts or travel this holiday season expect to use a credit card, and more than half (52%) say they don’t plan to pay off their holiday balances in full when the bill comes due. Among those who anticipate carrying [holiday debt](https://money.com/pay-off-debt-after-holidays/), 17% expect it will take more than six months to pay it off, and more than a third say they’ll rely on flexible payment options such as [buy now, pay later (BNPL) services](https://money.com/holiday-shopping-ai-bnpl-inflation/) to manage the tab. ## Regain financial stability with the help of Freedom Debt Relief ### Freedom can start you on the path to resolve your debt, especially if you owe over $20,000. Why wait? Select your state to get started today! [Get Started](https://money.com/pr/l67257dab4e3?ap_referrer=%2Fhow-to-avoid-holiday-debt%2F) The financial strain is often compounded by emotional pressures as more people report feeling obligated to buy gifts they can't afford — a behavior [Beyond Finance](https://www.prnewswire.com/news-releases/the-high-cost-of-holiday-cheer-65-of-americans-cant-tell-how-much-is-safe-to-spend-this-holiday-season-302610764.html), a debt settlement company, has dubbed “guilt-giving.” Others fall into “FOMO-spending,” where the urge to keep up with friends or trends also leads to making impulse purchases. “When spending is driven by emotions rather than a plan, it can get out of hand,” Dan Snyder, director of personal financial planning at AICPA, said in the [report](https://www.aicpa-cima.com/news/article/aicpa-holiday-spending-survey-reveals-budgeting-debt-and-a-bit-of-regret). “Left unchecked, impulse spending, whether it’s on gifts, travel or entertaining, can lead to serious financial drain. Having a plan can help spenders start the New Year with their financial wellness intact.” ## How to budget and avoid unnecessary holiday debt To create a holiday spending plan, start by setting a budget for gifts, travel and entertaining. Be sure to map out what you can afford to spend before Black Friday and peak shopping days approach, so you're not distracted by flashy sales. Decide who you're buying for and how much you’re willing to spend on each person — and then stick to the list. Even small impulse purchases can quickly add up and lead to the kind of financial strain you're trying to avoid. If you love the dopamine hit you get from an impulse purchase, you can build that into your plan. Set aside $50 or $100 of fun money so you can scratch the itch when you see something you like without blowing your budget. Many [consumers are turning to handmade or DIY gifts](https://money.com/diy-holiday-gift-ideas-save-money/) as a way to stretch budgets, according to Deloitte’s [2025 Holiday Retail Survey](https://www.deloitte.com/content/dam/insights/articles/2025/us188488_cic-holiday-retail/pdf/DI_2025-Holiday-Survey.pdf). Crafting your own gifts can save you money with the right planning, but it can also backfire if you buy pricey craft kits, overspend on supplies or underestimate the time involved. If you choose to go the DIY route, set a budget for materials, reuse what you already have, [shop thrift](https://money.com/rising-apparel-tariffs-boost-secondhand-resale-market/) or discount stores — and avoid setting yourself up for failure by taking on an ambitious craft project you’ll abandon with glitter in your hair and nothing to wrap. If you’re planning to travel over the holidays, consider using credit card points or miles to help [cut costs on flights](https://money.com/dollar-scholar-cheap-flights/), hotels or car rentals. Booking early and being flexible with your travel dates can also help you avoid sky-high prices. In many cases, [flying *on* the holiday](https://finance.yahoo.com/personal-finance/credit-cards/article/save-on-holiday-travel-credit-cards-201231200.html) itself is cheaper, since the days before and after major holidays like Thanksgiving, Christmas Eve and Christmas Day tend to be some of the [busiest (and most expensive) travel days of the year](https://www.clearme.com/blog/busiest-travel-day-of-the-year). Given how many shoppers expect to carry balances into the new year, having a strategy to manage — and ideally prevent — holiday debt is essential. When it comes to credit card debt, the goal is to pay off balances as quickly as possible. Interest charges can pile up fast, turning your balance into a long-term financial burden. If paying in full isn’t feasible, set a realistic payment plan to chip away at the debt. Keep in mind that wracking up debt on your credit card now may require cutting back later. If you don't have extra cash on hand to pay for holiday expenses without financing it, you may not have it in January or February either — unless you're anticipating a bigger-than-normal payday. Finally, be cautious with [BNPL plans](https://money.com/bnpl-popular-despite-credit-cards/). While they can be convenient, they also stretch holiday debt over several months, making it easy to underestimate how multiple staggered payments will impact your budget. [Many "pay-in-four" BNPL loans don't charge interest](https://www.nerdwallet.com/personal-loans/learn/buy-now-pay-later) if payments are made on time, but late payments can trigger [fees](https://www.consumerfinance.gov/ask-cfpb/do-buy-now-pay-later-bnpl-loans-have-fees-en-2118/). And some longer-term BNPL options do charge interest — [sometimes at rates comparable to (or even higher than) credit cards](https://www.nerdwallet.com/personal-loans/learn/buy-now-pay-later). The key is to stay on top of payment due dates and avoid stacking too many installments at once. ## Reduce payments and make debt manageable with a Debt Relief program ![VISIT SITE](https://s3.consumersadvocate.org/prd/image/image/25289/medium_2e7b27ce-b30d-40a3-beef-0139ecba6b47.png) Our Partner [VISIT SITE](https://money.com/go/4507b7e19253?bidid=4125748731&pmeta=p129-c628-u31158&ptid=671774282&ptoken=a220aadf8900f8f3dab2d74db31f70b5) ![VISIT SITE](https://s3.consumersadvocate.org/prd/image/image/23879/medium_3847e650-29eb-411b-9b8c-05deb0d02cbc.png) Our Partner [VISIT SITE](https://money.com/go/6b735e1bf338?bidid=4125748733&pmeta=p129-c628-u31158&ptid=671774282&ptoken=e00b809d9ae3daaa9d879b78e3876bb3) ![VISIT SITE](https://s3.consumersadvocate.org/prd/image/image/15565/medium_832cc4b7-74f8-4735-8fe1-6917816cbe8d.png) Our Partner [VISIT SITE](https://money.com/go/911eea62d60e?bidid=4125748729&pmeta=p129-c628-u31158&ptid=671774282&ptoken=a9b9d5c2802b8891c31fbe86f83bc7cb) ![VISIT SITE](https://s3.consumersadvocate.org/prd/image/image/22445/medium_ba73f26a-1e1e-4e49-9739-df1298783de6.png) Our Partner [VISIT SITE](https://money.com/go/5d5256ce2dbb?bidid=4125748743&pmeta=p129-c628-u31158&ptid=671774282&ptoken=985fc2bcb22ea7d5f5a190198e7ce121) ![VISIT SITE](https://s3.consumersadvocate.org/prd/image/image/9246/medium_94931930-28cf-46b5-b09d-683979caec81.png) Our Partner [VISIT SITE](https://money.com/go/b995b51b3ac6?bidid=4125748735&pmeta=p129-c628-u31158&ptid=671774282&ptoken=cd4aee159c424954bca4b8a3206b0d21) ![](https://s3.consumersadvocate.org/prd/image/image/25289/medium_2e7b27ce-b30d-40a3-beef-0139ecba6b47.png) If you owe over $20,000 or more, Freedom Debt Relief can help you get back on your feet! [Get Started](https://money.com/pr/u5c2defb44d4?ap_referrer=%2Fhow-to-avoid-holiday-debt%2F) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/how-to-avoid-holiday-debt/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Shopping", "item": "https://money.com/shopping/" }, { "@type": "ListItem", "position": 3, "name": "Half of Americans Plan to Take on Holiday Debt. Here’s How to Avoid It" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/how-to-avoid-holiday-debt/#webpage", "url": "https://money.com/how-to-avoid-holiday-debt/", "name": "Half of Americans Plan to Take on Holiday Debt. 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