How to Pay Off Your Credit Card Debt: 9 Proven Tips

Paying off credit card debt has to be a top priority for all those with balances. If you have a high-interest rate, it can take years just to pay the minimum. We all know that credit card debt is a big problem for many people. With so much media attention on the subject, it’s hard not to be aware of the struggle. However, credit card debt is nothing to be ashamed of, and in many cases, it can actually help people stay out of more serious financial trouble and build a strong credit history. But, getting into credit card debt is a slippery slope that can quickly lead to unmanageable levels of debt.

One option is to go for debt consolidation. But this is an option if you have a lot of debt. Click here to know more about debt consolidation.

You could spend hours surfing the internet looking for ways to pay off your credit card debt fast, or you can read this blog post, and we’ll give you 9 proven tips that will help you get out of debt and stay there!

1. Limit the Number of Credit Cards

Limit the number of credit cards you have. As we know, having more than one card can get expensive and fast! It’s important to take a close look at your total debt, and what types of balances are on each account before deciding which cards you want to keep or cancel. For example, if most of your debt consists of high-interest balances, it may be worth considering canceling those cards and only keeping a low-interest card.

2. Know Your Billing Cycle

It’s important to know your billing cycle. Pay attention to which months you get billed and make sure that any payments are made during those months, so things don’t go unnoticed due to a busy schedule or forgetting. It may also be helpful to set up reminders for when payment is due, such as setting an alert on your phone calendar or emailing yourself.

3. Consider Opting for Automatic Payment Facility

In case you’re not able to do it on your own, consider opting for an Automatic Payment Facility. This is a service that will automatically withdraw the required amount from your account and make a payment towards credit card bills every month so that you don’t have to worry about missing any payments. The downside of this option is if there are insufficient funds in your account, the card company will charge a fee. For more information on automatic payment or high-interest balances, please contact your creditor.

4. Pay More Than the Minimum Amount

Paying more than the minimum amount usually means paying less interest over time. To find out how much you can afford to pay, think about your monthly income and what other costs you have that could be reduced or cut out altogether. If credit card companies allow it, consider using an online bill pay service, so you don’t forget any payments. The more you play, the quicker you can pay off your debt.

5. Take Advantage of The Holiday Period

The best way to manage credit cards is to take maximum advantage of the holiday period. Holidays like Christmas and New Year are times when credit card companies shower their clients with some amazing offers. Some cards give their users up to 50 days’ worth of interest-free period. This is one way to cost-effectively pay off your credit card debt. Different holidays have different offers. So, it is important to keep an eye on the offers. Regularly update yourself with their emails, messages, and newsletters.

6. Talk to Your Credit Card Company

If you are unable to pay your credit card debt owing to a financial crunch as a result of job loss, failure in business, or any other reason, your interest rate will keep on increasing until you choose to do something about it. If that’s the case, it is advised that you talk to your credit card company and discuss the same. If the company finds your reason to be genuine, they will make sure to lower some of your burdens, such as providing temporary succor or relaxing their recovery of interests.

7. Pay Off Your Debt with The Highest Interest Rate First

If you are struggling to pay off your debt owing to multiple cards, the best way is to start paying off from the one with the maximum interest rate. This will save on managing and allow for more time in the future without any credit card debts. This way, you will reduce your total interest outgo, saving a lot in the long run.

8. Convert Payment to Emis

If the credit card amount is huge and you are unable to pay it off using a single installment, then the best way is to convert it into EMIs. Nevertheless, converting the payment to EMI will require you to pay an additional interest. For instance, if you have borrowed $5000 and converted it into 5 months EMI, the credit card company will charge a monthly interest of 2-3% for sanctioning the EMI facility. Moreover, there will also be a processing fee, which is usually around 1-2% for setting up the EMI. So, look for no-cost EMI options.

9. Consider the Balance Transfer Facility

If you are unable to settle your credit card debt because of a sudden change in job, unemployment, or any other reason, consider the balance transfer facility. A balance transfer allows you to transfer all your balance from one or multiple cards to a single card. This ensures hassle-free management of your debt (if you have multiple cards) and gives you temporary relief from the high-interest rates. Usually, banks allow a credit-free period of up to 3 months to make it easy for you to repay the debt.

Conclusion

Overall, it is important to keep your credit card debt low and manageable. If you are unable to take care of the same on your own, please contact a financial advisor for some expert advice.