Tips to paying off Christmas credit card debt

HOUSTON (KTRK) -- By now, many people have seen the credit card statements from last month's big holiday shopping season.

If this is the year you vow to get all your credit cards paid off, experts say you can do it!

University of Houston's Bauer College of Business assistant professor John Lopez says in order to be financially free, you need a strategy.

"The first thing is to have a specific plan before you go into debt. How am I going to get out of debt as quickly as possible?" Lopez said.

Once you commit, work on short term goals. Lopez says he likes to follow financial guru Dave Ramsey's Debt Snowball plan.

"Take your credit cards from the smallest balance down to the largest balance - credit card one is $750, 2 - $1000 and credit card three is $1,500, and list them in order," Lopez said.

Take the first bill and pay it off first while paying the minimum payments on the others. Once you are done with the first credit card, you can pay off number two.

"That kind of gives you some momentum so you get a sense of empowerment," Lopez said.

Make sure not to fall for another enticing credit card offer. If a big retailer offers 0 percent interest, still say no because it might be a trap.

"80 percent of those people don't pay those off and credit card companies know that and they are going to charge those interest rates," Lopez said.

Instead, stay on track by adding 3 to 6 months of your expenses into your savings. If something unexpected happens, you will be able to cover it.

"You have a car that got towed or something broke at the house, you had a medical expense, a deductible - if you don't have money to cover that, you are going to go into debt, and that's a difficult spiral to get out of," Lopez said.

For Dave Ramsey's Baby Steps Plan that Lopez uses in his teachings, click here.