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One Simple Trick to Manage Your Holiday Debt

New Year’s resolutions should be about fun stuff, not your debt

In our corner of the fintech world, January 1st is an important day. Why? (Yes, it’s New Years Day, but that’s not it.) Because on January 1st, once ye olde hangover has dissipated, people realize that it’s time to face the music. And by music, we mean debt. On January 1st, the holidays are officially over, and it’s time to reckon with our wily pre-Christmas spending habits.

This shift in attitude is measurable: last year, the increase in search terms like “debt consolidation” peaked in Canada between December 29 and January 4th. And let’s face it: if over the holidays we spend irresponsibly, when the new year and our new debt rolls around, we have no one to blame but ourselves.

But if you ask us, it doesn’t have to be this way.

The Holidays Are Designed to Make Us Spend More

If this has been (or will be) you, know you’re not alone and if we’re honest, the deck is stacked against us. Every year, as we set about our holiday shopping, we’re liable to get good at magical thinking. With emotions on high and the pressure to adequately contribute to your shared holiday celebrations, it’s way too easy to forget just how many times you’ve pulled out that little plastic card at a cash register. No, not your debit card. Your credit card. Yeah. The sneaky one.

This is the latest year in a centuries long trend of buying gifts around the holidays for the people we love (and even people we don’t love, like coworkers, for whom you are, inexplicably, “Secret Santa”). This is so true that we can, at times, conflate demonstrating love and gratitude with the giving of a perfect gift—and this is our first mistake. The economic implications of holiday spending are massive, and this is why on November 1st every year, some business whips out a Christmas advertisement or deal.

So, not only are we inclined toward giving gifts based on years of tradition, we’re also manipulated into feeling like we need to buy more, bigger, better, year over year. It adds up: last year, the average American racked up $1,325 in holiday debt.

Fortify Your Financial Hygiene With the Right Tools

Tackling this problem is easier said than done, but there are tools available to help you solve the debt problem before it starts. Instead of going it alone against the big, beautiful world of consumer goods (and their respective marketing hordes feverishly clamouring over your dollars), we’d like to introduce you to one of our favourite options: prepaid credit cards, like our Mogo Visa* Platinum Prepaid Card. (You can just call it your Platinum Card, which is pretty cool.)

Prepaid credit cards are great tools to reign in holiday spending because their functioning is the best financial advice in action: don’t spend what you don’t have. The basics are simple: you have to load your own funds on the card in order to use it. This is a great tool to improve (or bolster!) your financial hygiene in two ways: you never spend more than you’ve loaded, and there’s zero danger of accidentally cutting into your rent money—two credit card risks that can really screw you up if you’re not careful.

Not All Prepaid Cards Are Made Equal

Even with great habits, it can be difficult to resist that one last perfect bottle of wine, or those stupid socks where you can have a picture of your sister’s cat’s cute dumb face on them, you know the ones. Like we said: the holiday machine is designed to make you spend money you don’t have.

So we created the pièce de résistance: our MogoCard.1 Because where our habits may falter, our tools should not—and not all prepaid cards are created equally.

We designed the MogoCard with one goal in mind: to help you manage your finances well and efficiently, with the intention of debt-free living. The card does this in ways best summarized in a few handy bullet points:

  • It’s basically free. That’s it. That’s the point.
  • Every time you spend a dollar, you’ll receive a notification alerting you to the transaction total, as well as your current balance
  • We’ll offer insights to help you better balance your finances (only if you want them, of course)
  • Use tools like automated transfers and “spending goals” to stretch your money as far as it can go (you might get shamed for buying that extra cocktail, though)2
  • Your card is protected from unauthorized use with the Visa Zero Liability Policy.

  • (And if all this weren’t enough of a draw, you should also know that with every dollar you spend with the MogoCard, we purchase carbon credits to offset 1 pound of CO2 through our Amazon Rainforest Project. Just FYI, y’all.)

    When setting off after an ambitious goal, you should have the tools best suited for the job. It’s no mean feat, making it through the holidays without debt, but we can help. No more magical thinking, no more overspending. No more repentant resolutions. Start now.


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    * Trademark of Visa International Service Association and used under licence by Peoples Trust Company. Mogo Visa Platinum Prepaid Card is issued by Peoples Trust Company pursuant to licence by Visa Int. and is subject to Terms and Conditions, visit mogo.ca for full details. Your MogoCard balance is not insured by the Canada Deposit Insurance Corporation (CDIC).

    1 - MogoCard means the Mogo Visa Platinum Prepaid Card.
    2 - Spending Goal feature is currently only available to MogoMembers transferring funds from a Visa product, such as a Visa Debit, Visa Credit or Visa Prepaid Card.

    Citation for debt claim: Giovanetti, Erika. “Americans Racked Up $1,325 in Holiday Debt in 2019 — And Most Won’t Pay It Off on Time.” MagnifyMoney, https://www.magnifymoney.com/blog/news/2019-holiday-debt-survey/. Accessed 10 Dec. 2020.

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