When it comes to paying off debt, the faster, the better. And that is especially true if you have credit card debt. The fastest way to pay off credit card debt is to focus on one credit card at a time and to then choose a debt repayment plan that helps you stay motivated.
When I first started paying off debt, I learned how much interest was accruing on my debt and it literally kept me awake at night. Every day that passed meant I’d basically spent $50 per day (that’s how much was accruing on my debt at the time!) and I had nothing to show for it.
I kept imagining all the ways I could use that money for things I wanted or for financial goals I had. It bothered me. And I’m glad it bothered me because that fueled my hate debt fire enough to help me get my financial act together and pay it off as fast as I possibly could.
So, if you’re like me and feeling frustrated at your debt, you’ll want to get the dirt on the fastest way to pay off credit card debt. It can feel so overwhelming at first, but using these methods, you’ll be credit card debt free faster than you think.
FOCUS ON ONE CREDIT CARD BALANCE AT A TIME.
One of the fastest ways to pay off credit card debt is to focus on one credit card balance at a time. While you continue making minimum payments on all of your debt, you should direct any extra payments towards just one card at a time. Once you have paid off the balance of one card, use the extra money you have now freed up in your budget and apply it to your next credit card balance. Continue to do this until all of the balances on your credit cards are eliminated.
Choose the right method of debt repayment.
In order to focus on one credit card balance at at time as the fastest way to pay off credit card debt, you’ll need to choose the best debt repayment plan for you. There are several debt repayment plans out there, but the three best are the debt avalanche method, the debt snowball method, and the worst debt method.
Debt avalanche method: The debt avalanche method is where you target your credit card balance with the highest interest rate first. Make minimum payments on all of your debt, but put your extra payments towards your highest interest debt first. Once that balance is paid off, target your next highest interest balance.
Debt snowball: The debt snowball method is where you target your smallest credit card balance first while continuing to make minimum payments on your other debt. When your smallest balance is paid off, move on to the next smallest balance, and so on until your debt is eliminated.
Worst debt: The worst debt method is where you target your least favorite debt first. Focus on paying off that balance while continuing to make minimum payments on your other debt. Once you’ve paid off the balance of your worst debt, move on to your next least favorite debt. Or, if the remainder of your debt bothers you all the same, you can change your method to the debt avalanche or the debt snowball method.
While these three methods are the fastest ways to pay off credit card debt, if your goal is to raise your credit score, you’ll want to pay off your debt based on your highest credit utilization ratio. Not sure what that is? Read more about how to pay off debt to raise your credit score here.
CONSIDER CONSOLIDATING AS THE FASTEST WAY TO PAY OFF CREDIT CARD DEBT.
One of the fastest ways you can pay off credit card debt is to consolidate it by taking on a personal loan to pay off the balance of your debt. Of course you will still have to pay off the balance of your personal loan, but it will eliminate your credit card debt just as soon as you take on the loan and pay off the balance.
One thing I like about this method is that it makes making payments much more simpler– you’ll make one payment to one lender rather than multiple payments to multiple lenders.
It also saves you money on interest, since you’ll trade in your high interest credit card balances for a much lower interest rate with the personal loan. It can seem a little intimidating at first if you’ve never used a personal loan before, but it’s actually a smart move.
Another option is to do a balance transfer using a new credit card. What happens with a balance transfer is that you open a new credit card account. The credit card company will literally transfer over the balance(s) of your other credit card(s). And then for a period of time, usually 18 months, they will offer you 0% interest for you doing so. This is a solid option if you are confident you can pay off the balance within 18 months.
If you aren’t sure you can pay off the balance or if you’d rather not open up a new line of credit, or if you’d rather simplify the debt repayment process, a personal loan is the better route to take.
One of the hardest parts about paying off credit card debt fast is staying on the ball and keeping yourself motivated. Just like someone who is dieting might binge and slip back into their old ways, you may find yourself slipping back into overspending. That’s why it’s important to find tools that keep you motivated on your journey. Remember, the faster you pay off your credit card debt, the more money you’ll save and be able to spend on the things that matter most to you.
You can use the Paidback app to discover how much money you can save by paying it off faster with our debt calculators. You can also track all of your debt there in one easy to see place, follow like minded people on debt free journeys, and get custom debt advice from our debt experts. You can download Paidback (it’s free!) here:
Paidback is a debt motivational tool that will keep you on the right track when it comes to debt repayment. You can track your debt, view other users’ progress on their debt, celebrate debt payoff milestones, make extra payments, and personal advice from our debt experts.
Paying off credit card debt can feel really overwhelming initially. The fastest way to pay off credit card debt is to focus on one credit card at a time and to then choose a debt repayment plan that helps you stay motivated.
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