10 Ways To Get Rid of Credit Card Debt Faster

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If you look at your finances and see a lot of debt, you're not alone.

Pandemic stimulus packages did help to reduce U.S. consumer debt in 2020. But Federal Reserve data shows that balances began to grow again in 2021 and reached a new all-time high of over $860 billion in May 2022. According to Experian’s 2021 State of Credit report, the average American now owes $5,525 on their credit cards.

Credit card debt is some of the most expensive debt you can carry. It often has interest rates that start in the high teens. Pair these high interest rates with low minimum monthly payments, and it’s easy to find yourself in a heap of credit card debt.

If you’re like many Americans and you're wondering how to pay off consumer debt, don’t panic. Debt happens, and it’s possible to pay it off. Take it from me — someone who has paid off more than $40,000 in debt — becoming debt-free is possible if you take a dedicated approach. Below are ten strategies to help you pay off debt more quickly.

The Short Version

  • Total credit card debt in the United States reached a new all-time-high of over $860 billion in May 2022.
  • According to Experian’s 2021 State of Credit report, the average American carries $5,525 in credit card debt.
  • There are several approaches you can take to pay off your credit card debt faster including doubling your payments, using a debt snowball or debt avalanche, and more.
  • If you need more help, there are multiple not-for-profit resources that can provide personalized counsel.

10 Ways Get to Rid of Credit Card Debt Faster

These approaches to debt management can be tailored to fit your specific situation. Use any single strategy on its own, or pick and choose which ones will work for you

1. Define Your Debt

When you know that you owe money but aren’t sure about your interest rate or even how much you owe, the ambiguity of the situation can cause a massive amount of stress. That’s why a significant first step toward paying off your debt is to make a list of every debt you owe, along with the interest rate, current balance, and monthly payment. Taking the time to understand your debt load will help you decide which debts to tackle first.

2. Double Your Minimum Payment

Sometimes, making a debt repayment strategy is totally overwhelming. If this is the case, keep it simple. One way to make progress in paying down your credit card debt is to double your minimum payment.

Making only the minimum payment is an excellent way to stay in debt for a long time, but doubling your minimum amount will ensure you eventually pay down your debt. This isn't the fastest strategy on its own, but it will get the ball rolling in the right direction.

3. Use the Debt Snowball

You can try out the snowball approach if a more structured debt repayment plan sounds like your speed.  Using this strategy, you tackle your smallest debt first. Once that debt is paid off, you focus on the next smallest debt in line.

Like a snowball rolling down a hill, you gain momentum as you pay off each debt and use the money freed up to add more to subsequent debt payments until all your debt is paid off. This strategy is popular because it provides some “quick wins” when you first pay off the smaller debts.

4. Use the Debt Avalanche

Like the snowball approach, the debt avalanche shifts your priorities. Instead of paying off your debt starting with the smallest balance first, you pay off your debts starting with the highest interest rate. Tackling your highest interest debt first will result in the fastest debt reduction. Still, it can be disheartening to make payments on a large balance without seeing a lot of progress — especially if you're still contending with your other debts.

5. Automate Your Payments

Sometimes it's tempting to blow off your debt repayment commitments and give up on your plan when an attractive purchase or travel opportunity comes along. An excellent way to avoid temptation is to automate your payments.

If you automate your debt repayment, you won't miss payments (which helps improve your credit score) and will also be required to make payments whether you want to. Automatic payments can also help you forecast your debt-free date since you know what your payments will be every single month.

6. Consider Debt Consolidation

Credit card debt is some of the most expensive debt you can carry, second only to payday loans. So reducing that interest rate could save you a lot of time and money over the course of your repayment. One way to do this is to consolidate your debt into a lower interest tool like a personal loan.

If you elect to go this route, you may be able to pay off your debt much quicker. But make sure you don’t run up your credit cards again. In fact, you may want to call your credit card provider and ask for a lower spending limit to eliminate temptation. In addition, create a budget to help you avoid overspending.

Note that some credit card borrowers use a home equity loan or home equity line of credit (HELOC) to consolidate their debt. Both generally have lower interest rates than personal loans which can make them attractive.

However, this is a riskier choice as you'd be moving from unsecured from of debt debt (credit card debt) to debt that's secured by your home. And when you use your home as collateral, you give your lender the right to foreclose should you fall behind on your payments.

7. Transfer Your Balance to a 0% APR Credit Card

Balance transfer credit cards often offer no interest on balances for a set period (usually 6-15 months). So if you could transfer your entire outstanding balance to one of these cards, you could totally eliminate interest accrual on your debt for up to a year or longer.

But there’s two catches. First, nearly all of these cards charge a one-time balance transfer fee that generally ranges from 3% to 5% of the transfer amount.

Second, after the low interest period ends, these credit cards typically have interest rates comparable to other credit cards. For this reason, only transfer a balance that you're confident you can pay off during the promotional period.

8. Minimize Expenses

If you’ve applied all the strategies above and are still interested in speeding up your debt repayment plan, it’s time to put your spending under a microscope and free up extra cash to throw at your debt. The best way to minimize your expenses is to track spending for a month and make a budget.

Cut your costs in the easy areas first; cook at home more often and compare rates for insurance and utilities. If you’re interested in further minimizing your expenses, consider more drastic steps like switching to public transit, trimming your entertainment budget, or even getting a roommate.

Read more >>> How to Find Your Money Leaks and Stop Overspending

9. Increase Income

After you’ve cut your expenses, another option is to increase your income. The best place to start increasing your income is with your full-time job. Negotiate a raise if you haven’t recently, or consider changing jobs to a higher-paying role. If neither of these is an option, freelancing on the side or working a second job can bring extra cash. You could even consider selling unused items for some quick cash.

10. Be Honest with Your Creditors

Finally, if you’re having problems making your minimum payments, you must be honest with your creditors. Call them and tell them about the situation, and ask to arrange a payment plan.

Most creditors would rather work with you than risk you missing payments or walking away from your debt. But if your creditors can’t reduce your interest rate or set up a payment plan, strive to continue making at least your minimum payments to protect your credit score.

Resources to Help You Gain Control of Your Debt

While these ten steps are a great place to start, you might still find yourself battling unmanageable debt. If you’re in a situation where you need more help to get your debt under control, check out these three resources:

  • Usa.gov/debt — This government resource tells you what to look for in a credit counselling organization and gives you the lowdown on what debt collectors can and cannot legally do to collect debts.
  • National Foundation for Credit Counseling — This national non-profit organization focuses on helping you get out of debt through education and counseling services.
  • Financial Counseling Association of America – This is the professional association for financial counsellors in America. Find a financial counselor with the proper credentials through this association.

The Bottom Line

Struggling with credit card debt is hard and might make you feel alone. But the reality is many Americans carry credit card debt — they just don’t talk about it. If you’re ready to get control of your credit card debt, these ten tips are a great place to start. You can start doing them today, and if you need more help beyond this article, the resources we’ve linked above provide safe and reliable advice.

Further Reading:

Jordann Brown

Jordann Brown is a millennial money expert and personal finance blogger based in Nova Scotia, Canada. Jordann is the founder of the popular personal finance blog, My Alternate Life, and she frequently appears as an expert in Canada media.

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