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How to Decide Which Credit Card To Pay Off First

Last updated 09/29/2022 by

Jamela Adam

Edited by

Fact checked by

Choose which credit card you should pay first by using the avalanche or snowball method. You can also choose to transfer your entire credit card balance to a 0% APR balance transfer card, get a debt consolidation loan, or set up automatic payments to ensure your debts are paid on time.
According to the latest data from Experian, the average household credit card debt in the United States is $5,221. And as of the beginning of 2022, the total credit card debt in the country surpassed a whopping $1 trillion.
If you’re one of the millions of consumers struggling with this financial burden, you’re probably looking for a way to relieve some weight off your shoulders. The good news is that there are plenty of methods to get out of debt and improve your credit score in the process. In this article, we’ll explore how you can quickly pay off your credit card debts and which card to pay off first.

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Select a debt repayment strategy

Credit card debt can feel like a never-ending nightmare. You make a small payment, and then your balance hardly budges because of the high-interest rate. Unfortunately, many Americans are familiar with this struggle, as you can see by the growing outstanding balance below.
Fortunately, there are some simple steps you can take to get started. Rather than settling on a specific credit card account to pay off first, one of the most important things to do is to select a debt repayment strategy that works for you.

1. The avalanche method

Here’s how the avalanche method works: You list all of your debts from the highest interest rate to the lowest, and then focus on paying off the debt with the highest interest rate first. Once the high-interest card is 100% paid off, you can allocate payments towards the card with the next highest APR.
By tackling your debts in this order, you save yourself a good chunk of change in interest charges. However, this method may require a higher level of patience and perseverance since it might take some time to see results if your balance is high.

2. The snowball method

The snowball method tackles debt in a slightly different way. First, list your debts from smallest to largest. Next, put as much money as possible towards the smallest debt until it’s paid off, all while still making minimum payments on your other credit cards. After that, move on to the next debt on your list and repeat the process.
The snowball method is a great way to get started on paying off your credit card debt. By attacking the credit card with the smallest balance first, you can get a quick win under your belt and build some momentum. Plus, it’ll boost your confidence to see that you’re making quick and noticeable progress, which will likely reflect in your credit report as well.

3. Balance transfer cards

Though not a typical debt payoff strategy, you may also experience some debt relief by transferring your credit card balance to a balance transfer card. This is especially true for balance transfer cards with a 0% introductory APR, which can help you save money on interest and become debt-free quicker. But before you fill out an application for a balance transfer card, there are a few things you need to keep in mind.
First, you’ll typically need a good credit score (670 or above) to qualify for the best offers. Also, remember that most balance transfer cards have a 3% to 5% balance transfer fee. That means if you’re doing balance transfers for $5,000 worth of debt, you could end up paying $150 to $250 in fees. But even with those fees, you could still save hundreds of dollars in interest charges over the life of your debt if you take advantage of a 0% APR offer.
If you’re struggling to keep up with your cards’ interest rates, you may want to consider one of the below balance transfer cards, each of which has a 0% APR introductory offer.

4. Debt consolidation loan

By lumping all of your credit card debts into one, you can save money on interest and fees and make payments more manageable. Plus, you’ll only have to deal with one lender instead of multiple creditors. So if you’ve been struggling with juggling your several credit card debts, consolidating them into a single loan could be the solution you need.
One of the best options for debt consolidation is a personal loan. Take a look at some of the personal loan lenders below to see if consolidating your credit card payments into one loan is the best choice for you.

Pro Tip

Use this debt payoff calculator to get a better idea of how much of your monthly payments are going toward paying off the principal amount vs. the interest.

Other ways to speed up your credit card repayment

If you’re looking to get out of debt fast, you can do a few things to speed up your repayment.

1. Make more than the minimum payment

Depending on the credit card issuer and other factors such as your credit score, the interest rates on credit cards can often be as high as 25%. So if you only make the minimum payment each month, it’ll take a long time to chip away at your overall balance. And the longer it takes you to pay off your debt, the more money you’ll end up paying in interest.
So if you want to get out of debt as quickly as possible, make sure to pay more than the minimum monthly payments.
IMPORTANT! If you can’t afford to make a payment much larger than the minimum, you may want to instead make more than one payment per month. This will further lower your card’s principal balance and help boost your credit score at the same time.

2. Use a budgeting app

Budgeting apps can be a great way to help you stay on top of your credit card repayments. By tracking your spending and setting up a budget, you can see where your money goes each month. And when you know exactly how much you’re spending, you can make informed decisions about how to better allocate your funds. For example, if you realize you’re spending way too much money on dining out, you can take actionable steps to reallocate that portion of your budget to credit card repayment.
If you’re not sure where to start, take a look at some of the money management tools below. You can sort the below options by application cost and monthly fee to ensure you find the best tool for your current budget.

3. Consider credit counseling

If you’re feeling overwhelmed by your credit card debt, you might want to give credit counseling a try. Many non-profit organizations, such as the National Foundation for Credit Counseling (NFCC), offer low-cost and even free credit counseling. Their counselors will work with you to develop a repayment plan that fits your unique financial situation, and they can also provide guidance and support to help you stay on track.
To search outside of the NFCC, consider the credit counselors below. You can also compare each firm’s services and monthly fees to decide whether a credit counselor is the best choice for you.

4. Set up automatic payments

One of the best ways to repay your credit card debt is to set up automatic payments with your financial institution. This way, you’ll never have to worry about making a late payment or forgetting to pay your bill.
Missing a payment not only hurts your credit score but can also incur hefty fees that set you back on your journey to financial freedom. By setting up automatic payments, you can start getting serious about paying off your debts and prevent those late fees from stacking up.


Is it better to pay off one credit card or reduce the balances on two?

When you’ve got multiple credit cards, it can be tempting to just try and tackle them all at once. But that’s typically not the best strategy. You’re much better off focusing on one card at a time and paying it off as quickly as possible. Then you can move on to the next card.
Of course, that doesn’t mean you can just ignore your other credit cards. You still need to make minimum payments on all of them to avoid late fees and interest charges.

Is it better to pay off high-balance credit cards first?

If you have multiple credit cards with balances, should you pay off the one with the highest balance first? Or should you go for the low-hanging fruit and pay off the card with the lowest balance?
According to the snowball method, paying off the card with the lowest balance is often the better way to tackle credit card debt. The idea is that when you see your debt shrinking quickly, you’ll be motivated to keep going. Plus, when you’re just getting started, paying off a smaller balance is less daunting than tackling a huge one.

Does my credit score go up every time I make a payment?

Yes, timely credit card payments will increase your credit score. This is because your payment history accounts for 35% of your credit score.
So if you’re looking to boost your score, one of the best things you can do is to pay off your credit card balances in full and on time each month. Of course, it’s important to be patient — credit scores won’t change overnight. But as long as you’re consistent with your payments, you should start seeing an improvement in your score over time.

Should I pay off my credit card in full or leave a small balance?

If you can, always strive to pay off your credit card balance in full. Leaving a small balance will not benefit your credit score and can cost you money in interest fees.
Plus, paying off your credit card balance in full is one of the best things you can do for your finances. Not only will it help you save money on interest, but it’ll also show creditors that you’re good at managing your money.

Key Takeaways

  • There are two popular ways to pay off credit card debt: the avalanche method and the snowball method.
  • The avalanche method recommends paying off the credit card with the highest APR first. Alternatively, the snowball method advises you to start with the credit card with the smallest balance.
  • Other ways to tackle your credit card debt include taking out a debt consolidation loan, using a balance transfer card, paying more than the minimum payment, and setting up automatic payments.
  • When it comes to paying off your debt, there’s no one-size-fits-all solution. Ultimately, the best repayment method is the one you can stick to and the one that works best for your unique situation.

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