Credit card debt is the worst. The super high interest rates make paying the debt 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.
Luckily, it’s extremely difficult but not impossible. I eventually dug myself out of a hole, and you can, too. This is true 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.
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 pay more in interest but in reality, you’ll feel much more motivated to continue on your debt freedom path by celebrating several small wins. This will get you to pay off debt much faster.
3. Pay Off the Highest-Interest Card First
For those who can’t get over the fact that the debt snowball method isn’t theoretically the most efficient way of paying off debt, 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.