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Getting Rid of Credit Card Debt is Easy

Getting Rid of Credit Card Debt is Easy
Mark Cappel
UpdatedApr 18, 2012
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    7 min read
Key Takeaways:
  • Decide if you need a regular- or heavy-duty debt relief solution.
  • Learn 10 regular-duty tactics to get rid of credit card debt.
  • 4 heavy-duty tactics can help you with distressing debt.

Learn 14 Strategies to Get Rid of Credit Card Debt

Wander into a hardware store and you will find two choices for most products on the shelves: regular and heavy duty. Getting rid of credit card debt comes in two choices, too: regular and heavy duty. We pick regular-duty solutions when our needs are simple and the job is not too tough. We pick heavy duty tools when the job is too big for a regular solution.

Quick Tip

Get rid of your credit card debt with a no-cost, no obligation analysis of your debt resolution options from a debt consolidation expert.

Check out the regular- and heavy-duty ideas for getting rid of credit card debt in the two tables below.

Regular-Duty Tactics to Get Rid of Credit Card Debt
Freeze Your CardsPut your high-balance credit cards in a plastic bowl of water and place it in the freezer.Less-permanent than cutting up your cards, which would require you to request replacements if you face an emergency and need to make a charge.
Sell Your StuffHave a yard sale, or sell your stuff on Craigslist or eBay. If your church or community has a yard sale, bring the stuff you do not use or need anymore.Two big benefits: First, it raises cash that, depending on your state laws, may be untaxable so you will most likely keep the entire amount. Second, it reduces clutter and your space needs. A key tactic if you rent storage space.
Get a Part-Time JobWork retail for minimum wage, or consider starting an online business if you're Web savvy.The income benefit is obvious, but one not-so-obvious benefit is if you're working two or three nights per week, those are hours when you can't spend money.
Debt AvalancheOrder debts by interest rate. Pay minimums on all but the highest interest rate. On the highest, pay all you can afford. Repeat when the highest is paid.Pays-off your debts at the lowest possible cost. This is in contrast to the "debt snowball" where you pay-off the smallest balances first.
Create a BudgetA key strategy. List and rank all household expenses.A budget creates a financial roadmap for your household and prevents living from crisis to crisis.
Join a GroupLarge churches and community groups have personal finance groups where people meet weekly or monthly and listen to speakers and share personal finance ideasNo one is born an expert on personal finance, and everyone learns differently. If you are a "group learner" who responds well to live, interactive conversation, nothing beats a personal finance club.
Carry CashLeave your credit cards at home and instead shop with cash.Studies show people buy less when they pay with cash.
Get MadHit bottom, and become angry enough at yourself to want to change your situation. Following a budget and saving instead of saving takes discipline.Some people need to "hit bottom" before they change their behavior. If you are one of these people, get angry!
Start a HobbyIf your hobby is hitting the mall or shopping online, change to a more positive activity.Turn off the TV and start knitting, woodworking, maintaining your vehicle yourself, blogging, or volunteering at your church or a community group.
Try the Savings MachineCheck out the Savings machine.This no-cost online tool allows you to see the long-term costs of common small expenses. For example, what is the 10-year cost of a daily latte?


Regular-Duty Tactics to Get Rid of Credit Card Debt

Getting Rid of Credit Card Debt: Regular Duty Repair

We will not discuss all of the tactics to get rid of debt mentioned in the table above. Three need a more in-depth look.

We cannot overemphasize the importance of creating a household budget. Take a look at the budget guide to help you get started on creating a budget. The heart of a budget is a list of your household’s priorities. Your heart and head is where you will find your spending. A budget helps you decide what you think is important in your life. Is it premium cable channels or saving for a vacation? Is it a new car or saving for a college education? Is it paying-off your credit card balances or buying another pair of jeans? People resist creating a budget because they do not want to make hard choices. But making the right choices is part of being a responsible person, and a budget can help you make the choices that serve you best.

Hobbies can help you have money in two ways. First, most hobbies are not expensive to start. If you are interested in an expensive hobby, you will likely find clubs in your area where members can borrow or rent expensive equipment at a low cost. Second, some hobbies, such as knitting or woodworking, result in objects you can use as gifts.

The Savings Machine is one last item to emphasize. Give this a try to learn how little daily or weekly discretionary expenses can add-up months and years roll by. The results may surprise you.

Heavy-Duty Tactics to Get Rid of Credit Card Debt
Credit CounselingCredit counselor helps you create a household budget, and then a debt management plan to repay lenders over 5 years.May result in lower interest expense, though this is not automatic. No creditor calls. Mixed credit score impact.
Debt SettlementStop paying balances while you make weekly deposits into a special bank account. Debt settlement company negotiates settlements with creditors for a fraction of the amount due.Lower monthly cost than credit counseling, and shorter time to debt freedom, too. Aggressive strategy to resolve debt that avoids bankruptcy.
BankruptcyFile a chapter 7 or 13. In a chapter 7, all qualified debts are discharged. In a chapter 13, debts are paid for 5 years, and remaining balances may be discharged.Chapter 7 results in fast and relatively low-cost time to debt freedom. Chapter 13 is longer, but will discharge a second mortgage.
RefinanceA cash-out refinance taps into a property’s equity.The cash from a cash-out refinance can be used to consolidate credit card bills, pay for higher education, or buy other property.


Heavy-Duty Tactics to Get Rid of Credit Card Debt

Getting Rid of Credit Card Debt: Heavy Duty Repair

It goes beyond the scope of this article to discuss the nuances of each heavy-duty debt resolution technique. Instead, let's hit a few high points for each strategy mentioned in the table above.

Credit counseling is an expensive solution that repays your entire balance due on all of your enrolled accounts. It has the potential to place a light impact on your credit score, although this varies and depends on how diligent the credit card counselor is about making your monthly payments by the due date. If you can afford about 3% of your total enrolled debts due as a monthly payment, then consider credit counseling.

However, if 3% is too much for your monthly budget, then look at debt settlement. This is a much more aggressive strategy. Its positives are a lower monthly cost and a shorter time to debt freedom than credit counseling. However, you will need to deal with creditors who call and try to lure you away from debt settlement and back into making monthly minimum payments. Also, there is a chance a hyper-aggressive creditor may file a lawsuit against a person enrolled in a debt settlement plan. This is rare, however.

Bankruptcy can result in a complete discharge of most debts if you qualify for a chapter 7. However, if you do not qualify for a chapter 7, then you follow a 5-year chapter 13 plan where you repay what you can afford for 5 years. The downside to bankruptcy is it creates a public document, and can appear on your credit report for 10 years. However, the negative effects of a bankruptcy rarely last more than half that time.

Credit counseling, debt settlement, and bankruptcy are available to anyone regardless of their credit score, income, or ownership of property. A refinance is another heavy-duty method to get rid of credit card debt, but it depends on your:

  • Credit score
  • Debt-to-income ratio
  • Income history
  • Equity available in your property

A home equity loan or mortgage refinance may be difficult to qualify for, but it has the advantage of stretching out your payments over the life of the loan. However, time has a cost, and even at a low interest rate, a 20- or 30-year loan carries significant interest costs.


Getting rid of credit card debt is not easy. The hardest parts are finding the strategies that work best for you, and then following through with your plan. Regular-duty or heavy-duty, you have tools available to help you get rid of your credit card debt.