Tips to Pay of Credit Cards

Updated on January 18, 2008
B.F. asks from Spur, TX
14 answers

What is the quickest and easiest way to pay off credit cards. Has anyone used a consumer credt counseling service or debt consolidation? Is there anyway to decrease the interest on the cards? I owe about $7000.00 on my cards with interest between 14-28%. YIKES!

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I have bought Dave Ramsey's book and am reading it. Thank you all for the advice!

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answers from Dallas on

I have heard some bad things about CCC.
The best way to pay off cards is, IMHO... a) stop using; b) pay the minimum due on all but one. Pay the ONE off in chuncks (until you pay that one off). You might pick the one with the lowest balance and be able to pay it off quicker.
OR you may try to get a consolidation loan.

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answers from Austin on

CCC can be helpful to those who are in big trouble and bankruptcy is an issue. HOWEVER, it does show up on your bank acct, and any loans/lines of credit you try to open. FYI

Here's what I advise:
1) Pick a company (Visa, MC, etc) and give them a call. Ask them for two things: a) the credit necessary to transfer all of your debt to that one card and b)a 0% (or as low as they'll go) interest rate. Tell them that if they won't help you, another card will and you'll just take your money there. Most, you'll find will be accomodating.

2) After the cards are consolidated into one, lower interest card, make 2 payments each month. You can sit down and determine how much of your budget you have to pay on cards (without needing to use them because you've spent all your money paying them off - my dad calls that "pee-peeing in the wind"). Anyway - determine a reasonable amount, split that in two, and every 2 weeks, send them a payment.

3)If you can't manage consolidating the cards (because of late payments, not enough credit) transfer what you can, then pay off the higher interest cards first - they're costing you more in the long run. If you have a department store card of any kind (target, jcpenny, macys, kohls) SHREDD that bad boy NOW, don't wait until it's paid - GET IT GONE! They suck up tons of money in interest and aren't as flexible as a simple MC or Visa or Discover.

4) Once you are out of debt, use the cards - but DO NOT EVER purchase anything you can't pay off in 3 months. Here's a super fast way to raise your credit score. Buy something in the ballpark of $300. Pay $100/month for 3 months and pay it off. Your credit score will increase a ton because you've shown that not only can you pay off a debt, but that you can successfully hold a debt for a reasonable amount of time (thus making them a little money).

Best of luck - let us know how it goes!

1 mom found this helpful


answers from Dallas on

Thank you Amanda! I followed your instructions, got one of my credit cards to offer me 0% for six months to move all my balance to them. So I can just have one payment and I know I will pay it off whithin 6 mths.

Good luck B.!



answers from Houston on

Dear B.:
Yes, you can apply for new cards, roll over the balances and close the old cards. You may get 0% for a while (that helps with the balance) and should aim for a low overall APR in the long run.

However, you may want to contact one of those free credit counseling organizations. They do more or less the same, but they have more clout than you by yourself, and they can negotiate waiving some of the amount owed. That can be justified two ways:
1) They already made quite a bunch on interest off you.
2) They know they get paid and don't deal with deadbeats.
So even for the lenders it makes sense.

If your balance goes down from $7000 to $5000 and your APR goes down from around 20% to 12%, your payments will become more manageable. You should be willing to work towards eliminating the debt though, not look at it as more credit to spend.

If you make that commendable step, expect to lay out your complete financial situation, and don't hold back. If you are not completely open, they will not be able to help you, because the number 1 goal is to reduce both the debt and the time to repay it, which eventually will better your credit score AND your quality of life. If you don't mention some debt, you may not be able to meet your new payments.

They may even have helpful tips on how to budget properly, so that you don't slide into a mess again after this one is over. It requires discipline and a bit of effort to stay on top of personal finances. Try to live within a framework of necessity and no debt, not within a credit line given to you by greedy banks...

Good luck.




answers from Dallas on

Hi B.,

My husband and I went through Financial Peace University also and it was SO amazing. It actually inspired a passion in my husband to help others. We made some mistakes along the way, so he wants to help others avoid those mistakes. You do not have too much and should be able to do this without a CCCS or other type organization. I know Dave Ramsey is not a fan of these programs. Feel free to contact my husband for free advising. He is starting up a business in financial advising and trying to build up clients. He has studied Financial Peace (and two other books by Dave Ramsey), and Crown--which is another financial study. He will be happy to meet with you in person and give you tools to make the right decision for your family.

Here is his info: (he knows I put him on here, so he will not be surprised...)
Kevin Kitch
Financial Advisor
[email protected]



answers from Dallas on

I second Total Money Makeover with Dave Ramsey. Get his book and read it cover to cover - you'll be able to read in rather quickly. Also, he's going to be in Dallas February 23rd. He also has a talk show on 570AM - I believe from either 12-4 or 1-4 Monday - Friday.

Call your credit card companies and ask for a lower rate. With all the competition, they can't refuse because they know someone will come along and offer you a better rate. If you have a decent credit score and history with them, they should be willing to lower your rate.

Definately don't use a credit counseling service - read Total Money Makeover to find out why. $7K is not worth what it will do to your credit.



answers from San Antonio on

Not sure what your finacial situation is or how many cards, we only have one, and we pay double what the min. payment is every month that way the interest doesnt add up too much on us, otherwise it seems like you are never ganna pay it off, from what we have been told most if not all of that min payment is just the interest not really any of the charges. I know that some companies can help but usually you can do some things on your own instead of spending more money for someone else to tell you how to spend your money. You could also do things like the money you use to eat out or other leisurely things and add that to your payments. Hope this helps!! Good Luck!!



answers from Dallas on

I highly recommened The Total Money Makeover by Dave Ramsey! It's a great book, and my husband and I are well on our way to having 10--yes TEN--credit cards paid off. First thing to do is STOP using them. Then start a "debt snowball". Make a list of all of them starting with the lowest balance (don't worry about interest rates). Make your minimums on all except one--starting with the lowest balance card, pay every penny you can extra toward it. Once that one is paid off, go to the next lowest, and continue on until they are all paid off. It's amazing how quickly you can pay them all! BUT definately get the book-- he teachs how to get completely out of debt and get ready for retirement! Awesome stuff!

Hope that helps,



answers from Dallas on

You can use CCS, and they are good. You can negotiate on your own... but beware, this will show up on your credit report!



answers from Dallas on

Good for you for wanting to solve this problem before it gets unmanageable! We know folks with 3 or 4 times that in credit debt and it only gets harder to get out from under it!

I would highly recommend you visit He's the creator of financial peace university. You can also buy the book "Total Money Makeover" and have what you need to get a great start on reducing your credit debt. I can give you a brief description of his advice. But first, let me tell you that I used consumer credit counselling right when I got out of college for credit card debt of a similar amount. I would not recommend it because it marks your credit report the same way a bankruptcy would. I had a horrible time trying to buy a car with that on there! Also, they do consilidate the debt for you, and the interest is reduced somewhat, but the monthly payment is the same (basically, they combined all the minimum payments into one payment). The good news is that as soon as you pay them off, your credit report is cleared.

As far as rolling the balances over to 0% cards, we've done that, and if you are disciplined and watch your dates, it can work. Because of juggling different dates and time frames for the 0% offers, it could get you into trouble if you have more than one. Note that you pay at least $45 for a balance transfer fee for each balance. If you can get a 0% offer for a credit line big enough to cover all of your credit card debt, and you can keep track of when the 0% term is up to keep rolling over the remaining balance, this could work for you. We did this with the last $4,000 or so of an auto loan and paid off the car early.

As far as Financial Peace University and Dave Ramsey, the idea is that you begin getting rid of your debt with the smallest balance (not the lowest interest rate, which is different from some conventional advice). You pay the minimum balance on all but that lowest one, and put every extra penny towards it until it's gone. Because you've begun with the smallest balance, you'll get a sense of accomplishment pretty quickly, and be more encouraged to continue with your next balance. When you get to the second lowest balance, you pay the minimum on that one, PLUS whatever you had been paying on the first balance.

Also, it helps to have a budget in place when you begin your debt reduction. The Total Money Makeover book tells you how to set up the budget and develop a cash spending plan. If you have a budget and are using cash for groceries, etc., you shouldn't need your credit cards. Thus, you won't be adding to your balances while trying to reduce them!

We've lived on the cash budget system for about 5 years now and it's great. It seems daunting at first because we're so used to the ease of swiping cards to pay for things, but it doesn't take long to get used to it.

Good luck!



answers from Birmingham on

Pay half the amount due/payment every two weeks. Not twice a month... every two weeks. That the advice from the money expert on CNN.



answers from Houston on

My husband and I took the Financial Peace University through our church and then ended up teaching it because it works. We paid off $8000.00 in just under 6 months. You need to do a budget and like Dave Ramsey says it may take a month to 3 months to tweak the numbers but it really does work and use cash for everything. My kids were about the age of your kids and we sat them down and told them that there is no eating out until we have the debt paid off, they even helped in weak moments when it was late and the drive thrus looked good, they held us accountable. Get the Total Money Makeover book, it has ideas and tips. Good luck and you can do it



answers from Dallas on

We are going to Financial Peace University. Someone had asked this similar question and this was suggested. I googled it and got to reading it and it seems very interesting. I posted asking about it and got tons of positive responses. You can click on my name and read the responses I recieved if you like.

Good luck...



answers from Houston on

I would agree with reading anything Dave Ramsey. He is awesome. Either buy his book "Total Money Makeover" or if you can find a church in your area offering Financial Peace University, I would highly recommend that you do that course. It will change your life and the way you look at money. The credit counseling services are iffy. A lot of them are out to scam you and finding a reputable one is difficult. I feel like you could be easily taken by them if you aren't careful. I really think this is something you can do yourself if you're disciplined. Try Dave Ramsey and I promise you won't be sorry!

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