How To Get Out Of Credit Card Debt Fast: 10 Tricks For Paying Off Credit Cards

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by Enoch Omololu

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This guide will help you pay off credit card debt quickly even if you have limited income.

Debt is generally challenging to pay off. However, credit card debt takes the pain up a notch and is tougher to deal with than most!

When you are on a low income, dead broke, and saddled with all kinds of debt, paying off your credit card debt may feel like an impossible task.

On one hand, your revolving high-interest credit card gives you the freedom to spend money you don’t have, but on the other hand, it requires you to pay interest fees that are higher than any realistic returns you can generate elsewhere.

With the interest compounding on a daily basis, it is no surprise that getting out of credit card debt is so difficult.

As per Value Penguin, the collective amount of credit card debt owed by Americans exceeded $1.03 trillion in 2018.

What this means is that the average U.S. household was carrying $5,700 in credit card debt and a whopping $104 billion was being paid in interest on an annual basis!

On the Canadian side, the financial picture does not look much better, with a collective $599 billion (CAD) in credit card and non-mortgage debt, and an average credit card balance of $4,154.

Want to get out of debt quickly? Follow these 10 strategies for paying off credit cards.

How To Pay Off Your Credit Card Debt Quickly

If you want to get out of debt, you need to figure out why you are in debt in the first place.

You also need to understand how credit cards work – annual percentage rate (APR), compound interest, principal, minimum payments, and credit scores.

Lastly, you will need to start making more than the minimum payment required.

1. Understand Your Debt Problem

This is your starting point for getting out of debt. You should be able to fully answer the question: “Why am I in debt?”

Is this an ongoing issue of your income exceeding your expenses? Or, is this the result of a one-time or series of unfortunate circumstances e.g. medical emergency?

Whatever the case may be, it is important to know why you are in debt so you can tackle the problem at the root.

If you regularly spend more than you earn, then it is time to start living within your means or to find ways to increase your income. If you accumulated debt due to misfortune, life happens to us all, and we just have to deal with it.

How much do you owe?

Find out exactly how much you owe in credit cards, personal loans, lines of credit, mortgages, etc., and write down your debts with their corresponding interest rates.

While this article is focused on helping you pay off your credit card debt, knowing what you owe and what they are costing you, helps to put your financial situation into perspective.

Related: 15 Steps To Improve Your Finances This Year

How To Get Rid of Credit Card Debt Fast

2. Develop a Payment Plan

Now that you know what your credit card debt is, how do you plan to pay it off? To simplify your options, let us look at two strategies popularized by Dave Ramsey: the ‘debt snowball’ and ‘debt avalanche’ debt reduction strategies.

Debt Snowball

This debt reduction strategy focuses on paying off your small balances first while putting down the minimum payment on all other debt.

So, using your list of debts from Step 1, the snowball approach would be to pay off your smallest balance one after the other until you pay off all your debts.

For example, say your list of debts is as below and you can only afford to put $600 towards paying off debt every month:

DebtBalanceInterest Rate (APR)Minimum Payment
Credit Card A$8,00022%$160
Credit Card B$1,50015%$30
Car Loan$6,0008%$122

Using the debt snowball strategy, your focus is on paying off Card B because it has your lowest balance.

For this example, you will pay the $282 total minimum payment required for Card A and the car loan, and use the remaining $318 to pay down the $1,500 balance you have on Card B.

Debt Avalanche

This debt repayment strategy focuses on paying down your highest interest debt first.

Using the same example above, and assuming you can only afford $600 in debt payments per month, the debt avalanche approach means that you make the $152 total minimum payments on Card B and your auto loan, while the remaining $448 goes to paying down the balance on Card A because it has the highest APR of 22%.

Debt Snowball vs. Debt Avalanche

The debt snowball gives you quick wins which can motivate you to stick to your debt payoff plan. For example, it is easier to pay off $1,500 than it is to pay off $8,000.

Debt avalanche tackles your high-interest debt first. Using the scenario above, you will aim to pay off the balance on Card A first because it is charging you the highest interest rate. This approach saves you money in the long run because you pay less in overall interest costs, and as such, wipe out all your balances faster.

In general, the longer you hold onto the debt, the higher the interest you pay. If you have debts with different APRs, the debt with a higher interest rate generates more fees with every passing day than the one with a lower rate.

So, from a financial standpoint, the debt avalanche method is preferable as it could save you thousands of dollars. However, if you need the motivation to stay the course, the snowball approach can help you remain committed when the going gets tough.

These are just two examples of debt reduction plans. The main idea is to have a plan for how you want to pay off your debts.

Related Reading: 13 Financial Apps To Automate Your Savings

Have credit card debt? Here's how you can pay it off fast even when you are broke or on a low income. Check out the 10 easy strategies for becoming debt free this year! #getoutofdebt #creditcarddebt #debtpayoff #budget #frugalliving #debt

3. Budget For Debt Repayment

You have developed a plan in Step 2 for paying off your debts. Now you just need to make sure that you have the funds available to pay down debt every month.

Prepare a budget that includes your income and expenses, and allocate a specific amount of money for debt repayment. Some useful budgeting apps include:

Canada – Mint, YNAB, and KOHO.

U.S. – PocketSmith, Mint, and YNAB.

Making just the minimum payment does not work.

Credit card companies don’t mind if you only make the minimum payments? Heck, that’s how they make their money because you carry a balance and pay interest month after month.

Going back to the debt list we used as an example in Step 2, if you only make the minimum monthly payments of $160 on your $8,000 Credit Card A balance, it will take you 137 months to pay off your debt!!

Yes, that’s a whopping 11 years and 5 months to pay off your initial $8,000 credit card debt. In this time frame, you would also have paid $13,884 in interest payments!

If instead, you added $140 to your minimum monthly payment and put down $300 every month (i.e. $160 + $140), you would pay off the debt in 37 months and your interest payments fall to $3,083. That’s over $10,000 in interest savings!

You can play around with this calculator to see how fast you can pay off your debt.

4. Hide Your Credit Cards and Pay Cash

Put your credit cards away and start using your debit or pay cash. It is a well-known fact that it is easier to overspend when using your card than it is with spending cash.

Cash impacts your chequing account immediately while credit creates an illusion that you have more money than you really do.

It is not advisable to close your credit card accounts, as this can tank your credit score. Instead, cut them up (you can always request a new one), or hide them where you can’t access them easily.

Use the old school cash envelope system where you budget for different expenses and then put the cash into envelopes to prevent over-spending. You need to start accounting for every dollar you spend, and using cash makes that easier.

Wondering what your credit score is? Check for FREE using Borrowell (Canada) or Credit Karma (U.S.).

5. Cut Your Expenses

A crucial part of budgeting is tracking your expenses so you know where your money is being spent. Change your spending habits so you can free up extra cash to put towards paying off debt.

There are so many ways for you to save more money every month, including:

For even more tips on how to save money, check out this summary article on 100 ways to save money on a daily basis.

Negotiate lower bills

You can often cut your cable, internet, and phone bills by calling your provider and asking for a better deal. If you reside in the U.S., there are services/apps  that automatically help you negotiate a lower bill, such as:


Trim (U.S.): will help negotiate your cable, internet, and phone bills, saving you as much as 30%. Users of Trim saved over $1,000,000 on their bills last month! Sign up to use Trim here!

Earn cash back when shopping

Earn cash back whenever you need to make a purchase – be it groceries, gas, clothing, household items, personal care, and pretty much anything. There is an abundance of free cash back apps that pay you anytime you shop, including:

A. Drop: Earn cash back automatically when you shop at five of your favourite retailers. Sign up for Drop ($5 bonus). You can also read my Drop App review.

B. Rakuten: Earn cash back on your online shopping and up to 30% in cash back. Sign up for Rakuten ($5-$30 bonus).

The additional $20 to $100 in cash back you get every month is extra money that can go towards debt repayment.

Related: Rakuten Review.

6. Create Additional Streams of Income

Pick up a side hustle or find another job so you can increase your income and put more money towards paying down your debt.

Side gig options for raising extra cash include:

» Blogging: There is really no limit to how much you can earn with blogging – it is up to you! Want to earn $2,000 in passive income every month? Check out this 6-step guide on how to start a profitable blog.

» Become a Proofreader: Make a 5-figure income proofreading from the comfort of your home.

» Teach English online: Sign up with VIPKid.

For other work-from-home jobs that pay well, check out this article.

You can also generate an additional $50 to $100 per month by taking online surveys. A few examples of legitimate online paid surveys I have used to raise extra cash include:

  • Swagbucks: They have paid their members over $500 million to date. Sign up to receive a $5 welcome bonus.
  • Pinecone Research: Earn $3 to $5 per survey completed. Join Pinecone.
  • Survey Junkie: Sign up.
  • Daily Rewards: It also offers a $5 sign-up bonus.
  • LifePoints: Get paid to take surveys and start with 10 free points. Sign up.

When you get a salary raise or bonus, cash gift, or tax refund, consider using this windfall to pay off debt.

7. Consider a Low Rate Balance Transfer

Many financial institutions offer a balance transfer card that starts with a low introductory rate for a specific period of time.

A balance transfer card that offers a 0% promo rate on your credit card debt for 12 months can save you thousands of dollars in interest, particularly if you pay down as much of the principal as you can (or all) during this interest-free period.

Balance transfer cards often come with a transfer fee of 1% to 5% of your balance. Read the fine print to know what the fees are (if any) and for how long the low rate is available.

Examples of balance transfer cards in Canada include:

Examples of balance transfer cards in the U.S. include:

  • Discover It Balance Transfer Card
  • BankAmericard Credit Card

8. Use a Personal Loan to Pay Off Your Credit Card Debt

If you have a large credit card balance, paying it off with a personal loan might be the way to go. While interest rates on credit cards may be as high as 29%, if your credit score is in fair to good shape, you could qualify for a personal loan at much lower rates.

The advantage of this strategy is that you can pay off multiple credit card balances and focus on making single, fixed, monthly payments on the loan. You also pay much less in interest costs and the installment loan payments boost your credit score.

Even if your credit score is less than stellar, you may still be able to obtain a debt consolidation loan, however, the interest rates will be higher.

Companies that offer personal loans for debt consolidation include:

  • LoanConnect (Canada): you can borrow up to $30,000 at various rates depending on your creditworthiness.
  • Lending Tree (US): get up to $50,000 in debt consolidation loans.

Home Equity Line of Credit (HELOC)

If you have equity in your home, you could qualify for a HELOC which is generally available at lower interest rates given that the loan is secured against your home! A HELOC can help you pay off your credit card debt faster while saving on interest.

Note that interest payments on HELOCs are no longer tax-deductible in the U.S.

There are some important things to note if you are considering using a personal loan or HELOC to pay off debt:

You will increase your debt load if you end up spending the loan on things other than debt repayment. It is important you make the regular monthly payment required on the loan.

Some debt consolidation loan providers charge an expensive origination fee. Read the small print to ensure you are not going to pay more in overall interest expense when the loan term and interest rate are considered.

You risk losing your home to the bank if you default on your HELOC.

How To Pay Off Debt

9. Negotiate a Lower Interest Rate

Call your credit card company and request a lower rate on your debt. While this may sound like a long shot, it may work and save you hundreds of dollars in interest on an annual basis.

Negotiation takes patience and persistence. Be polite, call, and call again, and you may be able to work something out.

10. Pay Every 2 Weeks and Utilize Your Savings

When you make multiple payments e.g. biweekly instead of monthly on your credit card during the month, your interest costs fall and you can pay off your debt faster. The principle behind this is simple.

Instead of 12 monthly payments, when you split your payments in two and pay half every 2 weeks, you end up making 26 payments during the year which is equivalent to 13 monthly payments.

For example, if your debt repayment plan is $600/month, you can pay $300 every 2 weeks. Even better, match the payment dates with when your bi-weekly paycheque hits your account, so you don’t incur any overdraft fees.

In addition to saving you money, this strategy can also help raise your credit score because frequent payments lower your credit utilization ratio.

Lastly, it gets you into the habit of making payments and seeing your debts diminish.

Debt vs. Savings

While putting money away in a savings account is great, it does not make much sense when you carry high-interest credit card debt.

The best savings interest rates currently available are around 3%. Compare this to interest costs of 20% or more on a credit card, and you are better off using your savings to first pay off credit card debt. When your balance is cleared, you can save or invest later with confidence and peace of mind!

This brings us to the end of this post and the various strategies you can use to destroy your debt quickly.

To recap, you should utilize the following strategies when paying off your credit card debt:

  1. Understand your debt problem
  2. Develop a payment plan
  3. Budget for debt repayment
  4. Hide your credit cards and pay cash
  5. Cut your expenses
  6. Create additional streams of income
  7. Consider a low rate balance transfer card
  8. Use a personal loan to pay off credit card debt
  9. Negotiate a lower interest rate
  10. Make frequent payments and utilize your savings

Wrapping Up

Debt can be damaging in so many ways, affecting your morale, health, relationships, and more.

If you are tired of your debt situation and are willing to follow the strategies detailed above, you can free yourself from the shackles of crushing debt and start to master your money in no time!

How To Get Out Of Credit Card Debt Fast: 10 Tricks For Paying Off Credit Cards

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Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. His writing has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, Credit Canada, MSN Money, National Post, CIBC, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

4 thoughts on “How To Get Out Of Credit Card Debt Fast: 10 Tricks For Paying Off Credit Cards”

  1. We’re really just wanting to pay off all our cards.and things and can’t really wait for it. And we’re really just itching to do this and get started.

    • @ Diane: Starting is your first good step. You’ve got this!!


  2. Very interesting article and very helpful.

    • @Maria: I am glad you found the post useful.
      Cheers. Enoch

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