How to Keep Your Credit Card Debt From Piling Up

Credit card debt is easy to accumulate, but hard to get rid of. How can you stay on top of it to avoid accruing an endless pile of debt? Or if you’re already sitting on credit card debt, how can you get rid of it?

Follow these tips to keep your credit card debt under control.

Make more than the minimum payment

Check your credit card statement. You should see a federally mandated box telling you how long it will take you to get out of debt.

The box includes two sections. The first shows you how long it will take you to get out of credit card debt if you pay only the minimum amount due on your statement. Depending on how much you owe, that could well be 30 years – the term of a typical home loan.

The second section shows what you’d have to pay per month to get out of credit card debt in just three years. We recommend that you pay this amount (or as close to it as you can get). Otherwise, you could be paying interest on your debt for decades.

Pay before you play

If you really want to get out of credit card debt, you need to finish paying off your card before using it again.

Yes, it might be difficult. But if you want to regain control of your finances, put the card away and don’t use it again until the balance is zero.

Transfer your balance

If your credit card debt is spread out across multiple different credit cards, consider consolidating them onto a single card. Choose your credit card with the lowest interest rate and use it to pay off the rest of your debts.

Alternatively, if you have good enough credit to qualify, there’s an option which could let you sidestep interest altogether. Many credit cards offer a 0% interest introductory period, wherein you pay no interest on your balance for a set period of time. This is a great opportunity to lower your interest costs.

However, you should only take this route if you’re able to pay off your credit card debt within the introductory period (often 6 months). After the period ends, the interest rate will skyrocket.

Consolidate your debts

An installment loan with a low APR is another great way to consolidate high-interest credit card debt. Simply borrow enough to pay off all your credit accounts in one fell swoop, and trade your debts for a single easy monthly payment.

These debt consolidation loans are a very popular way to reduce interest expenses and establish a structured plan to get out of debt. And it won’t just save you money — it’ll also provide peace of mind. Streamlining your debt into a single payment can make the process simpler and less intimidating, improving your odds of staying on top of your payments.

Don’t use credit cards for cash

Sure, it’s easy money. But beware the hidden fees and higher interest rates of credit cards. If you use credit cards to withdraw cash, you will likely see:

  • Upfront fees of 2-4%.
  • A higher interest rate than on regular charges.
  • No grace period — you’ll owe interest as soon as you receive the money.
  • Your monthly payments going to the balance with the lowest interest rate.

Know when to ask for help

Ideally, your balance is low enough that you can pay it off over the next few years. But unfortunately, that’s not the case for everyone. And if you have bad credit, it can be nearly impossible to consolidate or refinance your debt.

If your credit card debt has ballooned beyond your ability to repay it, it may be time to ask for help. Debt settlement companies can be your advocate, negotiating with your credit card companies to secure reduced payments or adjusted payment plans.

Whether you’re still working to repay your debt or you already have debt collectors knocking at your door, a competent debt settlement company can help.

Conclusions

Ready to get started? If you’re looking for a credit card with a 0% interest introductory period, you can compare our top recommended credit card companies here.

Or if you’d rather consolidate your debt with a loan, check out these reputable lenders.

Past the point of no return, and need an expert’s help in getting back on track? Compare debt settlement firms here.