3 Strategies for Paying Off Your Credit Card Debt Faster

by Alexa Mason · 6 comments

credit card debt

Credit card debt is the worst. The super high interest rates make paying it off seem to take forever. When I got my first credit card, it took me more than a year to pay back the $1,500 I’d racked up.

I eventually dug myself out of a hole, and you can, too — no matter the amount of debt you’re in. There are a few strategies that can help you pay down your credit card debt faster. But before we get to those, I need you to do one thing.

First: Call Your Credit Card Company

If you’re living with mountains of credit card debt, my guess is that you’re currently paying around 20% in interest. You need to try and get that lowered. The less interest you pay, the faster you can pay back your debts.

Call your credit card company and ask if they’ll lower your interest rate. You might get told no, you might get a “call back in a month,” or you might get a yes. If your credit score has improved since you first took out the cards, you’ve got a fair shot at getting your interest rate lowered.

Just get the call over with. You could save yourself hundreds of dollars in interest. The worst they can say is no.

Now that we have that out of the way, let’s talk strategies.

Commit yourself

1. Pay Your Bill Biweekly

If you’ve been meaning to pay more on your credit card bill, but your money seems to disappear before you get around to it, you need to pay it as soon as you receive your paycheck.

Figure out what you can put toward your debt, and do so as soon as you get paid. This might mean paying your credit card bill weekly or biweekly. The point is to make those extra payments before your money gets spent on the non-essentials.

2. Use the Debt Snowball Method

Made popular by Dave Ramsey, the debt snowball method can really psych you up to get the debt ball rolling.

In order to use this method, list all of your credit card debts from lowest balance to highest balance. Now start concentrating on wiping out the credit card with the lowest balance — while still making the minimum payments on the other cards.

The point of this strategy is to build momentum. In theory, you’ll feel much more motivated to continue on your debt freedom path by celebrating several small wins.

Lowest balance first

3. Pay Off the Highest-Interest Card First

Another method that can save you hundreds of dollars is paying off those balances with the highest interest rates first.

To do this, you need to list all of your credit card debt in order from highest interest to lowest interest. Now focus on eliminating those high-interest debts while paying the minimum on everything else.

There are several strategies you can use to pay off your credit card debt. No matter which route you choose, it’s important that you stick with the plan. You’ll only see results if you completely commit yourself. Go with whatever strategy best suits your lifestyle and empowers you to go full force.

Money Saving Tip: An incredibly effective way to save more is to reduce your monthly Internet and TV costs. Click here for the current Verizon FiOS promotion codes and promos to see if you can save more money every month from now on.

Related Posts

{ 6 comments… read them below or add one }

Levi Blackman October 30, 2013 at 12:57 pm

Great tips and just in time for me. I am working on paying off my mountain of debt and I am using the debt snowball. It would be easier if I was making more money but when I am finally free from all that interest it will sure feel like I am bringing in a lot more dough.

Reply

MoneyNing October 30, 2013 at 4:36 pm

It’ll feel amazing when you no longer have to account for a chunk of your income towards interest payments. Let the freedom party begin then!

Reply

MoneyNing October 30, 2013 at 4:34 pm

I don’t know about you, but if I got in credit card debt, I’ll eat ramen every day of the week until I pay it off. The interest, assuming I’m not participating in the 0% balance transfer game, is that ridiculous.

I only want to pay for a product at 100% of the cost at the most, if you get my drift.

Reply

Debt Debbie October 31, 2013 at 1:50 pm

Calling the card issuer is great advice and an often overlooked idea.

The Debt Snowball versus Highest-Interest Card First approach is hotly debated as to which approach is best. Known as the Debt Avalanche, option 3. is the fiscally correct option in that it gives rise to a lower Total Cost Of Debt (costing you less in the long run). This is of course assuming that you are successful – and therein lies the debate. It is argued that for the bigger picture of success (defined as arriving debt free) for many people the Snowball approach is more practicable, even though it costs more to follow the Snowball repayment strategy.

In addition to a repayment strategy, the fastest way to pay off cards is to put the maximum towards repayment. Sure, you can earn more money, but what some people overlook is the need to review their entire budget. This, in order to cut spending and reduce expenses so as to ‘release’ money for increased repayments. Ramen does indeed feature with the most hardcore strategist!

Reply

dojo November 3, 2013 at 2:41 am

I think that, no matter what you choose: high interest debt or smallest balance loans first, as long as you’re making a focused effort to clear out your debt it’s already a great thing. Paying off credit card is not hugely difficult, if you do make a plan and stick to it.

Reply

Max November 6, 2013 at 12:23 pm

It seems that Russian plastic cards become popular in the US ;)
The top card on the article’s photo is a VISA Gold credit card of the Sberbank of Russia (credit limit > $5000, 17.9% interest rate in Russian roubles, grace period is up to 50 days).
It was issued in the Ufa city (Bashkiria region) and it is quite fresh – issued not earlier than 2012, but not the latest (which are with Sochi 2014 Olympic games symbolic).
Below are Sberbank’s VISA Classic debit cards: a card with a winter forest and a salary card with a sunflower (issued in the Great Novgorod city).

Reply

Leave a Comment