How To Reduce Credit Card Debt: 5 Effective Methods
So, you have credit card debt. Maybe you used it to buy a laptop, to fund a holiday or tide you over when cash was low. Either way, you are trying to reduce your credit card debt but the monthly interest payment is killing you.
The balance keeps going up and you just want the debt to go away. Here are five things you can do right now to reduce your credit card debt.
PS; NO TIME to read ? Watch the video here !
If you are looking for a few ways to increase your savings read these articles first:
Master the Art of Saving with these 10 Strategies
Advantages And Disadvantages Of Budgeting (+FREE PDF)
1.Transfer debt to a 0% balance transfer card
The average credit card has an interest rate of 17%, so you are being charged that on top of the debt you owe. However, many banks offer 0% interest for an introductory period (normally six to 18 months), for new customers.
Why?
Because they want to entice new customers to join them and hope the new customer will stay with them after the introductory period.
You can take advantage of the introductory offer and transfer your current credit card balance with a high-interest rate to a credit card with 0% interest. This will reduce your credit card debt as all your repayments can go towards paying off the debt, instead of the interest payments!
Note-The balance transfer cards often charge a fee (normally 3%) to transfer the balance but overall, it could still make financial sense. The picture below illustrates how you can still end up paying less.

Steps to take:
- Find a balance transfer card provider with 0%
- Transfer your balance
- Pay as much as you can towards the balance every month
- Cancel or transfer to another balance transfer card provider before the introductory period ends
If you are from the UK, here is a list of 0% balance transfer cards. Some of them even have a 0% period for 20 months and no transfer fee. If you are from the USA, here is a list of 0% balance transfer providers.
2.Credit card consolidation into one loan
If you have more than one credit card, you can consolidate all your debts and pay them off with one loan. This will reduce your credit card debt in two ways. You pay a lower rate of interest, as personal loan rates are lower than credit card loan rates, and you have one debt to pay and manage, which is less hassle.
A quick google for personal loans in the UK indicates personal loan rates are 7% and in the US, it seems to be 9.37%.Given the fact that average credit card interest rates are 17%, consolidating all your credit card debts into a personal loan makes sense.
Steps to take:
- Add up the total balance of all credit cards
- Apply for a personal loan with a low-interest rate
- Pay off your credit cards with the personal loan
- Make monthly payments to pay off the personal loan
3.Renegotiate with creditors
Have you ever heard of the adage, ‘you don’t ask, you don’t get’?This rings true with reducing credit card debt too. Call each of your credit card providers and request a rate reduction. Note down how long you have been a customer, any other product you hold with them and if you have never missed a payment, mention that too.
I know this works because when I was working in the bank, we authorized rate reductions for certain customers, but only if they requested it. The lower interest rates will help you overcome credit card debt as you are paying less interest on your credit card balance.
Steps to take:
- Find out your current interest rate
- Research lower interest rates of other credit card providers
- Make a note of how many years you have been a loyal customer
- Note any other products you hold with them i.e.; personal loans, a mortgage, etc
- Find out if you have ever missed a repayment
- Call your credit card company with all the information and request a rate reduction
4. Credit counseling agency = FREE money advice
I have good news for you. It has the word ‘FREE’ in it. If you have debt, you can call a credit counseling agency for free and they will give you advice on the best way to pay off debt. Credit counseling agencies are non-profit organizations backed by the government to provide help and support to people with debt.
They can help you set up a debt management plan, negotiate lower interest rates for you and even provide you with legal advice by qualified lawyers. All for free. I highly recommend them.

A few credit counseling agencies in the UK are the National Debt Line, the Citizen’s Advice Bureau, and Step Change. In the US there is the National Foundation for Credit Counselling and the Financial Counselling Association of America.

If you are not from either of these countries, just google Credit counseling agency + country name e.g.; Credit counseling agency Malaysia.
Note. There are a few agencies out there that will charge a nominal fee. However, not the ones I mention above. Please try and seek advice from a free agency first. You are trying to reduce your debt, not increase it. Paying any additional fees will only increase your debt.
5. Pay off highest interest rate card first
If you have a few credit cards, there is an effective debt reduction plan to follow.
Pay off the card with the highest interest rate first. Pay the minimum balances on the other credit cards, but the bulk of your extra cash should go towards reducing the credit card charging you the highest amount of interest.
If you are looking for ways to make extra cash, you can take on a side hustle to work on in the evenings and weekends. Read this article on different side hustles you can work on, all within the comfort of your own home.
Side Hustles to Help Reduce your Debt
Credit card debt can be tackled using these five methods. Start with one or start with all- it’s your choice. Just don’t stick your head in the sand!
Have you paid off debt? Please share your tips below!
Ps; If you are looking for some extra ways to save , here are a few articles which will help you earn a bit of extra money:
- 20 Best Stay At Home Jobs
- How to Become an Online Teacher (and earn $6,000 per month!)
- How to Become an Online Proofreader(9 Easy Steps)
- How to Become a Well-Paid Freelance Writer
- How to Become a Virtual Assistant With No Experience
- How to Become a Freelance Social Media Manager
- How to Make Money on Etsy
- How to Make Money Blogging

I love this! These are really great and simple tricks that not everyone knows about.
Thanks Mindy! Glad you enjoyed it 🙂