5 Habits Keeping You in Credit Card Debt

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If you make the right money moves, you can crawl out of credit card debt faster and avoid taking on more. 

Credit card debt is a problem for many consumers in the United States. This type of high-interest debt can add up quickly. If you’re struggling to pay down your credit card debt, please know that you’re not alone. But you may be able to change some of the following habits to pay off your debt faster.

1. Not prioritizing debt with the highest interest rate

When you have high interest debt, like credit card debt, following the debt avalanche method can be beneficial. With this debt payoff method, you’ll first focus on paying off the debt with the highest interest rate and put as much extra money toward that debt to pay it off sooner. Doing this will save you money on interest. While following this strategy, ensure you continue to make payments on your other cards. It’s never a good idea to skip payments.

2. Making late payments

When you miss payments entirely or pay your credit card bills late, your card issuer will charge late fees. These fees can be costly and add to your existing balance. Additionally, unpaid debt will be subject to interest charges. It’s best to pay your credit card bills (and other bills) on time if you want to get out of debt faster.

Another reason this is a good money move is that your payment history is the most significant factor determining your credit score — it makes up 35% of your score. By paying your bills on time, you can work to improve your credit score and avoid negative marks on your credit report.

3. Paying only the minimum amount due

When you use a credit card and don’t pay the entire balance off monthly, your card issuer will charge you interest. Credit card interest rates can be high, making these fees costly. Instead of only paying the minimum amount due, you should aim to pay off your entire balance every month. If you never carry a balance, you won’t be charged interest.

4. Spending more than you can afford

When you use credit cards, you’re borrowing money to pay for purchases and must pay your debt back. For many consumers, it can be tempting to spend beyond their means and this is a dangerous habit. If you want to get out of debt and stay out, be sure to consider your financial situation before charging your cards. Using a budgeting app to set a budget can help you gain better control over your finances.

5. Continuing to use credit cards while you have outstanding debt

If you already have credit card debt, it’s in your best interest to stop using your credit cards. You’ll be adding to your existing credit card balance by continuing to charge your cards. The more you ignore your debt, the faster credit card interest charges pile up. If you struggle with overspending, you may want to hide your credit cards for now.

Credit card debt doesn’t have to be forever

While debt can be scary and stressful, it’s possible to get out of credit card debt. The first step is to figure out how much debt you have, and then you can make a plan. A popular way to tackle debt is to transfer your existing credit card debt to a balance transfer card to take advantage of promotional 0% APR interest rates while you pay off the balance. Check out the best balance transfer credit cards to learn more.

Top credit card wipes out interest until 2024

If you have credit card debt, transferring it to this top balance transfer card secures you a 0% intro APR for up to 21 months! Plus, you’ll pay no annual fee. Those are just a few reasons why our experts rate this card as a top pick to help get control of your debt. Read our full review for free and apply in just 2 minutes.

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