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The unfortunate reality of credit cards is that, while it can be quite easy to get into credit card debt, the nature of compound interest means that getting out of it is often much harder. Luckily, there are many resources that can help you learn how to pay off credit card debt as fast as possible.

This article will review some tactics for paying off credit card debt fast, as well as some strategies for avoiding it in the future.

Learn how to pay off credit card debt fast

The good news is that, if you’re reading this article, you’ve already taken the first step to paying off credit card debt—that is, you’ve taken the initiative to learn about your options.

Keep reading for 13 steps you can take that can help you get rid of your credit card debt once and for all.

1. Call your credit card company first

Before diving into a plan for paying off your debt, contact your credit card company (or companies if you have multiple cards) to see what your options might be. In some cases, you may be able to secure a reduced interest rate (particularly if you indicate you’re looking at low-interest cards from other companies), temporary payment reduction, or change in payment due date.

2. Figure out your debt pay down strategy

Once you’ve exhausted the available options from your credit card company, it’s time to make a plan for paying off your debt. While you certainly want to make the minimum payments on all your lines of credit to avoid a negative impact on your credit score, if you have multiple sources of debt it’s worth taking some time to figure out the most effective strategy for your budget and your level of self-discipline.

  • First, take stock of your sources of debt, including all credit cards and all types of loans (student, auto, home, personal, etc.). List them all in one place and note the interest rate on each.
  • Logically and financially, the debt with the highest interest rate should be the priority. The reasoning here is that, over the same period of time, a higher-interest debt will cost you the most (relative to the amount you owe), so you want to pay it down as soon as possible.
  • That said, some people need regular, smaller wins as encouragement to pay off all their debt, so if you’re worried you’ll lose steam paying off a large sum first, think about first focusing on a smaller balance that you can check off the list sooner.

Choosing the right strategy is ultimately a personal choice, as nobody knows better than you do what will keep you most motivated. Paying off debt can be a long road, so make a plan that reflects your personality—whether you need small wins along the way or will be most encouraged by saving the most money on interest by prioritizing the highest-interest debt, even if it will take many months to get that balance to zero.

3. Explore balance transfer options

If you need some time to get your finances back in order and would like to avoid accruing tons of interest while doing so, a balance transfer card could be a great option.

These cards typically offer between 6-18 months of 0% APR for balance transfers, which means you can move your old balance onto a new card and avoid accruing interest for a number of months. Keep in mind that most 0% APR offers still charge a balance transfer fee—and any purchases you make after opening the card will start accruing interest right away, so be sure to pay those off as soon as possible to avoid getting into unmanageable debt again.

If you’re planning to use a balance transfer offer, make sure the balance is on your new card before shutting down the old account. You wouldn’t want to close an account and forget about your payments, as those won’t go away (and interest will keep accruing) until the balance is fully paid off.

Also, don’t use the balance transfer as an excuse to ignore your debt for the period of 0% APR, as interest will start accruing right when the introductory offer is over. Instead, shoot to save enough so that you can pay off the balance by the end of the introductory period.

4. Research other consolidation options

If you have good credit, you may be able to pay off your credit card debt with a lower-interest personal loan, reducing the total amount of interest you’ll owe.

If you go this route, you’ll need to use the loan to pay off your credit card company, meaning future payments will go to your new lender—but, unlike with compounding interest for credit card debt, a personal loan is paid off in installments; you will receive a lump sum of cash up front and pay back the loan in fixed installments until the loan and interest is paid off.

Keep in mind that applying for a personal loan will result in a hard credit pull, so only apply if you think you have high chances of being approved for a low enough rate to make it worth it.

Unlike with credit cards, some personal loans charge an origination fee, so keep an eye out for fees you might not be expecting.

With Credible, you can see pre-approved rates for personal loans with no hard credit pull, as well as transparency into all fees and rates. Check out Credible’s personal loan offerings.

If you own a home, another option is to use a HELOC, or home equity line of credit, as a source of funds to pay off high-interest credit card debt. A HELOC doesn’t necessarily require excellent credit to secure a good rate, and you can generally get a lower rate than with an unsecured personal loan.

5. Get rid of the non-essentials

If you have other significant monthly expenses that you can forego, consider making some sacrifices that can help you get back on your feet.

If you’re renting an apartment or house, consider downsizing to something that will decrease your monthly expenditure—and help you not only get out of debt now but avoid it in the future.

Even the smaller things, like bringing lunch from home rather than eating out, can help your budget if you make a habit of it. For example, if you like to purchase a cup of coffee at your favorite coffee shop every day you may be spending as much as $1,500 a year on this little pick me up.

Instead, try brewing a pot of coffee at home. Every little thing adds up when you think that the interest on that cup of coffee is being compounded daily.

6. Avoid future credit card debt

Once you get out of credit card debt, it’s a good idea to build good habits and protections so that you can avoid a similar situation in the future. The following steps can help you stay away from credit card debt in the first place.

1. Budget wisely and track your spending

If you don’t already keep a budget, now might be the time to start doing so. Make sure your budget includes any non-negotiables, such as rent, utilities, car loans, student loans, etc. first, as these categories take the priority.

If you’re building up an emergency fund (see below), you should also prioritize payments into this account. Once you’ve subtracted fixed payments from your monthly income, you can determine how much money you can realistically spend on your credit card each month with respect to your discretionary categories.

Once your budget is in place, use it to track your spending over the course of the month. You can either do this manually by taking stock of your spending every few days or perhaps once a week, or by using an app such as YNAB or Mint.

Then, re-evaluate the budget you’ve created for yourself in 2 months to make sure you accounted for all of your spendings accurately.

An important part of staying within budget is simply keeping tabs on where you stand financially at any given time, rather than ignoring it until the end of the month, so make a habit of checking in with your account(s).

2. Put an emergency fund in place

An emergency fund is simply a savings account where you keep enough money to pay a few months worth of expenses in case something unexpected happens to your monthly income. There’s no hard number as to how much money you’ll need, but most experts recommend between 3-6 months of expenses.

An emergency fund can also be used to pay off credit card debt before interest starts accumulating, so it’s a good idea to get one established as soon as possible. If you end up dipping into your emergency fund for unexpected expenses, make a point of building it back up as soon as possible.

3. Pay more than your minimum

While it can be tempting to pay the minimum on your credit card each month and use those funds for more exciting purchases, make a point of paying as much as you can, if not your full balance. Any credit card balance carried over to the next month will start accruing interest, costing you more each day.

Carrying a balance on your credit cards also impacts your credit utilization rate which will inevitably decrease your credit score. A decreased credit score may result in higher APRs on the credit based products you want in the future (e.g., loans or other credit cards). This is the credit score slippery slope, and it is not a fun ride.

4. Spend excess funds wisely

In months with extra money (for example, a tax refund or unexpected windfalls like winning the lottery or an inheritance), use those funds strategically.

Think of it this way: Using your tax refund to pay off credit card debt or a loan, for example, will leave you with more money in the long-term, because you’ll save on interest by paying the debt off sooner.

While it’s hard not to use the extra cash to treat yourself, think of it as a long-term investment, and promise yourself a reward down the road. Try using the 50/25/25 rule: use 50% of the money to pay off some of your debt, 25% goes to your emergency fund and 25% goes into your discretionary budget to buy a little something for yourself—it’s a win/win!

5. Set it so you can forget it

It’s generally good practice to set up autopay for your credit cards and any other monthly payments so that you reduce the chances of missing a payment—particularly if you have multiple accounts and multiple due dates to keep track of.

Late payment fees for credit cards are typically over $30, and some will charge a “penalty” APR for a late payment, so it’s well worth the set-up work to avoid these consequences.

(Tip: But this does not mean you should ignore your bills. Make sure you review every bill that comes in to make sure you have not incurred any fraudulent charges on your account as well as to ensure that a refund you are expecting comes through)

6. Find the best products to help you pay off debt

As we’ve discussed above, the most effective strategies for getting your head above water financially often involve a balance transfer credit card or personal loan.

Once you’ve decided the best route for your situation and budget, the next step is choosing the right card or loan from dozens of available options. Credible can help you make the right decision by helping you compare credit cards and various personal loan options, so you can find the right option for your needs.