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Just because you’ve accumulated credit card debt, you don’t have to keep it forever.
No matter what your situation is, just know that you’re not without options. Debt stops controlling you once you learn to control it.
So take the lead and find out how to get rid of credit card debt once and for all.
I’ll walk you through the safest and most effective ways to get rid of credit card debt and bring that balance back down to zero.
5 Foolproof Ways To Get Rid Of Credit Card Debt For Good
Credit card debt is the worst type of debt you can carry because it comes with sky-high interest rates and fees.
So now that you’ve picked the best repayment strategy for you, here are seven ways to get rid of credit card debt quicker and reclaim your financial freedom.
1. Stop Using Your Credit Cards
Well, one of the best ways to get rid of credit card debt is to stop using credit cards.
This is not going to be easy, but you cannot pay down your credit card debt if you continue adding to the balance.
Credit cards aren’t a substitute for income from a full-time job.
And by using them that way, you’re setting yourself up for even more financial problems in the future.
2. Add Up All Your Credit Card Debt
If you’ve racked up a lot of debt, then it may be tempting to avoid looking at the total balance of how much you owe.
But dealing with the situation head-on is the only way you’re going to be able to manage it.
Take an afternoon, sit down, and make a list of all your credit card debt. I recommend creating a spreadsheet, and including the following information:
- Total balance
- Interest rate
- Minimum payment
- Credit card limit
Once you’ve gathered this information, you can come up with a plan for how to eliminate credit card debt.
3. Earn Extra Cash
Want to eliminate credit card debt as soon as possible? Instead of squeezing your budget for more money, why not try a different approach and take on some side hustles instead?
I’ve been doing side hustles for years earning anywhere from $100 to over $1,000 per month.
There are so many ways to make extra money on the side. And thanks to the Internet, most of them can be done right from your laptop and during your free time.
Plus, once your debt is paid off, nothing is stopping you from continuing to do them and enjoying all that extra cash!
4. Make A Balance Transfer
If your credit cards have high-interest rates, then it might be time to start shopping around. I always see credit card offers where they have 0% APR introductory rates that are perfect for making a balance transfer.
A balance transfer is where you move the money you owe from your high-interest credit card to the one with a low or 0% APR.
The advantage is that you’ll temporarily halt the interest accumulation and can focus on paying down the balance.
In order to qualify, you'll likely need to have a good or excellent credit score.
You’ll also want to make sure that once the low or 0% APR period expires that you’re not going to get hit with an even higher interest rate and be in a worse-off situation.
5. Consider A Debt Consolidation Loan
Another great way to pay off credit card debt is with a debt consolidation loan.
A debt consolidation loan is where you take out a low-interest loan that you can use to pay off your high-interest loans or credit card balances.
You are trading one debt for another, but there are advantages to choosing this strategy.
Personal loans come with lower interest rates than credit cards. And you may find it easier to focus on paying off one loan as opposed to four different credit cards.
How To Get Rid Of Credit Card Debt
The first thing to do to eliminate credit card debt is to choose the right strategy for you. Because the best way to get out of credit card debt is to be systematic about how you go about it.
Let’s say you’ve got three outstanding credit card balances:
- Card A with a 15% APR and $5,000 balance
- Card B with a 20% APR and $10,000 balance
- Card C with a 30% APR and $15,000 balance
Now, here are the two debt repayment strategies most financial experts recommend:
Financial expert Dave Ramsey has popularized the debt snowball method.
With this method, you start by paying off the debt with the smallest balance and make minimum payments on the rest.
Once that credit card is paid off, you apply that money to the next lowest balance, and so on.
Using the debt snowball method, you would:
- Start by putting your credit card debts in order of smallest to highest balance. In our case: A, B, then C.
- Focus on paying off credit card A first. Continue making the minimum payments on cards B and C.
- Once A is paid off, turn your attention to credit card B. Take all the money you were putting towards credit card A every month and roll it into your payment towards B. Continue making the minimum payment on card C.
- Once B is paid off, turn your attention to credit card C. Roll all the money you were putting towards A and B into your payment towards C. Continue until your debt is completely gone.
The debt avalanche is similar to the debt snowball, but it focuses on paying off the debt with the highest interest rate first.
You’ll save more money in interest with this method, but you may not achieve a quick win like you will with the debt snowball method.
Here’s how it works:
- Start by putting your credit card debts in order of highest to lowest interest rate (APR). In our case: C, B, then A.
- Focus on paying off credit card C first. Continue making the minimum payments on cards A and B.
- Once C is paid off, turn your attention to credit card B. Take all the money you were putting towards credit card C every month and roll it into your payment towards B. Continue making the minimum payment on card A.
- Once B is paid off, turn your attention to credit card A. Roll all the money you were putting towards C and B into your payment towards A. Continue until your debt is completely gone.
How To Get Rid Of Credit Card Debt For Good- Final Thoughts
There’s no one best way to get out of credit card debt. What worked in my situation or for a friend of yours might not work for you.
However, consider these ways to get rid of credit card debt and weigh their pros and cons carefully.
To start, you’ll need to know your debt balances, interest rates, minimum payments, and due dates. Slap those numbers into a spreadsheet and decide where to go from here!