Smart Strategies To Pay Off Credit Card Debt: 4 of the Best Methods

Credit cards are one of the most challenging forms of debt to pay off. That’s because they’re a type of revolving debt, and you can add more charges even as you continue paying them off. Don’t worry, though. Paying them off is possible with the right strategies!

Yes, bringing your card balances to zero is much easier when you use the correct methods. Read through this guide to discover the best approaches to take.

What Are the Best Methods for Paying Off Credit Card Debt?

When most people want to pay off their credit card debt, they assume only discipline and determination are necessary. On top of that, they tend to focus only on the “payment” part of that equation.

To pay off your credit card debt successfully, you must take a multi-prong approach involving the best strategies and methods.

Here are the 4 best ways to pay off your credit card debt:

1. The Debt Snowball Method

First, look closer at two of the most popular credit card debt payment strategies: the debt snowball method and the debt avalanche method.

The debt snowball method is a payment strategy championed by Dave Ramsey, a famous American radio personality. He’s been promoting this strategy for years, and many people find it helpful when getting rid of credit card debt.

Generally, the debt snowball method aims to pay off the smallest credit card balance first, regardless of the interest rate.

Here’s what that strategy looks like in practice:

1.        First, compare your credit cards and find the one with the smallest balance. Then, pay as much as possible over the minimum amount to that card until the balance is zero. Simultaneously, you’ll pay the minimum amount on all your other credit cards to stay current with them.
2.        Once you pay off the first card, move on to the one with the next smallest balance. At this point, the amount of money you have available is larger. In other words, getting rid of the smallest debt first allows you to snowball your finances and pay the second quicker.

All you have to do then is repeat the process one card at a time until all your debt is gone.

The debt snowball method has its fair share of pros and cons, including:

• Pro: After paying off the smallest debt, you’ll feel an immediate sense of accomplishment. That will also help you stay motivated to pay off all your other credit cards.
• Pro: This approach is straightforward and will speed up credit card payments with time.
• Con: You might pay more for interest charges because you’re focusing on the smallest credit card balances first, without considering their interest rates
• Con: This approach is not ideal for people more concerned with interest payments rather than achieving quick wins.

Overall, the debt snowball method keeps you motivated in the long run. So, you won’t have to rely purely on your discipline to keep going.

2. The Debt Avalanche Method 

Another popular credit card payment strategy is the debt avalanche method. With this approach, you’ll do the opposite of the debt snowball method.

With the debt avalanche method, your primary focus is the card with the highest interest rate. You’ll pay as much as possible to that card while still paying the minimum on all the others.

Naturally, this method isn’t ideal for everyone. Here are the pros and cons you must know before choosing to use this method:

• Pro: With this approach, you’ll minimize how much you pay towards interest.
• Pro: This approach is excellent if you’re more concerned about interest payments.
• Con: It’ll take longer to see your first win. That’s because you prioritize cards with more significant balances instead of smaller ones.
• Con: You’ll need more discipline to keep going, as it takes longer to pay off the first credit card you prioritize

3. Stop Relying on Credit Cards

The credit card is a uniquely challenging form of debt to pay off. That’s because it’s a type of revolving credit. In simple terms, that means you can put more charges on a credit card even as you’re trying to pay it off.

So, while the debt snowball and avalanche methods are effective for paying off a credit card, they’re not enough on their own. You must also have a strategy to reduce and stop adding new charges to your credit cards.

That’s why a method to speed up paying off your credit cards is to reduce your reliance on credit cards.

Reducing your reliance on credit cards involves several steps that can help you regain control over your finances. Here are some tried-and-true techniques for keeping that plastic in your wallet:

•       One approach is to create a budget and stick to it, prioritizing your expenses and avoiding unnecessary purchases.
•       You can also consider alternative payment methods, such as using a debit card or cash, to limit your credit card use.
•       Another effective strategy is to pay more than the minimum balance each month, which can help reduce the amount of interest you accumulate over time.

By reducing your reliance on credit cards, you can take control of your finances and work towards a debt-free future.

4. Pay More Using Side-Hustles and Windfalls

Suppose you’ve already chosen your preferred credit card debt payment strategy (i.e. debt snowball or debt avalanche), and you’ve stopped putting new charges on your cards.

In that case, the next thing to worry about is paying as much money as possible to your credit cards.

You’re likely using your primary income to do that. 

However, another smart strategy to use is using other forms of income to make more payments to your card balances, such as:

• Side hustle income. When you’re laser-focused on paying off your credit cards, you can use your spare time to make more money through a side hustle. That could be an online business, delivering pizzas, or driving for a rideshare service; anything that brings in extra dollars to pay your cards.
• Windfalls. Early in your card payment journey, you should decide that any windfalls (money that you receive unexpectedly) should be paid to your credit cards immediately. That could be birthday money, refunds, cash prizes, or anything else.

Using side hustles and windfalls to pay your credit cards is incredibly powerful and shouldn’t be ignored. This approach will help you pay your cards off even more quickly than ever before.

Final Thoughts

Overall, a smart approach to paying off credit card debt involves several different strategies simultaneously. However, most people focus on the payment strategy, such as the debt snowball (pay the smallest balance first) and the debt avalanche (pay the card with the highest interest rate first).

Those methods are excellent, but your approach should also ensure no new credit card charges and making extra payments using side hustles and windfalls.