Key takeaways

• Debt snowball or avalanche methods can be useful for people juggling multiple debts.
• Debt consolidation or balance transfer credit cards can help simplify payments and reduce interest paid over time.
• Paying off credit card debt isn’t just about making on-time payments; it’s changing habits for life.

Getting out of credit card debt is a challenge many Americans face. Putting these strategies into action can help you work towards becoming debt-free.

The right approach to paying off credit card debt depends on your situation: How much you owe, the interest rates on your cards, and what kind of motivation helps you stay on track. Here are some specific repayment strategies for paying off credit card debt, how those payoff methods work, and ways to avoid the mistakes that can keep balances from going down.

Fastest way to pay off credit card debt

The first step to paying off credit card debt quickly is getting clear on what you owe, the interest rates, and the minimum payments.

If you’re carrying multiple balances, making extra payments above the minimums is one way to accelerate progress. But should you pay off the highest interest rate first or the smallest balance? That’s where the snowball and avalanche methods come in.

Snowball vs. avalanche method

There are two main strategies:

Snowball method: Pay off the smallest balances first.

Avalanche method: Pay off the highest-interest balances first.

Which is fastest depends on your personality and motivation. If carrying multiple debts feels overwhelming, starting with smaller balances can give you quick wins and momentum. If your priority is saving money, paying down the highest-interest balances first may be more effective in the long run.

How to pay off credit card debt

1. Organize your debts from smallest balance to largest (snowball) or highest interest to lowest (avalanche).
2. Make at least the minimum payment on all accounts.
3. Reassess your living expenses and spending habits to identify areas to save.
4. Apply any money saved toward your chosen strategy — the smallest balance (snowball) or the highest interest rate (avalanche).
5. Once one debt is paid off, move to the next in line.
6. Continue until you are debt-free.

Read more: 1 in 4 Americans who carry credit card balances currently owe $10,000 or more

Debt consolidation and balance transfers: How do they work?

When you’re looking at how to pay off credit card debt, the snowball and avalanche methods can be a great way to start gaining traction. Beyond that, there are a few other tools that may help — from debt consolidation loans to balance transfer credit cards or even personal loans. These options can lower your interest rate or simplify payments, but they work best when paired with new spending habits and a clear plan.

Debt consolidation

Debt consolidation is the process of combining multiple debts into a single loan or payment plan. The goal is to simplify your repayment schedule and, ideally, reduce the interest you’re paying.

One common approach is using a personal loan to pay off credit card debt. By rolling several high-interest balances into one loan with a fixed rate and set monthly payment, you can create more predictability and often save money over time.

The key is making that one payment manageable while also building new habits that keep you from taking on additional debt.

Balance transfers

A balance transfer is when you move existing debt to a new credit card with an introductory 0% annual percentage rate (APR). Balance transfer credit cards generally offer 0% interest for a period of 12 to 21 months. You typically need good credit and to qualify for a high enough credit limit to cover your existing debt. Transfer fees may apply, which are generally 3 to 5% of the balance amount. 

A balance transfer can help pay off credit card debt faster, but it should be paired with a clear plan so you don’t end up with new balances on top of the old ones.

How paying off credit card debt can improve your credit score

Paying down credit card balances improves your utilization ratio — the amount of debt compared to your limit. As that goes down, your credit score increases. Payment history, the length of credit, and making on-time payments all help. As you continue paying off your credit card debt, you should see your credit score improve in small increments month by month.

Online tools provided by credit bureaus can show you what actions make the biggest difference, and you can even add rent or phone payments to your report to help improve your credit.

Read more: Does BNPL affect your credit score? It will soon

Budgeting to pay off debt

Alongside paying down credit card debt with repayment strategies, it helps to look for ways to lower your living expenses so you can budget for debt repayment beyond the monthly minimums. Trimming small purchases, like a daily coffee, may save a little, but it can also feel like deprivation and make it harder to stick with your plan. Instead, focus first on what I call the “big three”: Housing, transportation, and food. These categories often offer the biggest opportunities to free up money and pay off credit cards faster.

A debt overhaul can also be a life overhaul. Decluttering your home, selling what you don’t need, and cutting back on unnecessary expenses can give you both financial and mental clarity. Your money should align with your values — every dollar you spend is a vote for your future.

10 out of 10s

One exercise I recommend is the “10 out of 10s”: Make a list of activities that truly light you up, many of which cost little or nothing. Redirecting your spending toward those meaningful things helps you stay motivated while paying down credit card debt.

Even before you start paying, building a little bit of a nest egg — $500 to $1,000 – can help you avoid getting into the cycle of paying off the debt and then having to use the card again when an unexpected expense crops up. 

Read more: The 50-30-20 budget rule explained

Staying motivated and avoiding common mistakes

Getting out and staying out of credit card debt is freedom. Every step you take is a vote for the life you want to create. Still, it can be easy to feel overwhelmed and slip back into old patterns. One of the most common challenges is avoiding the all-or-nothing mindset: “I slipped, so I might as well give up.” Emotional spending can feel comforting in the moment but discouraging afterward. The key is to catch yourself early and get back on track, so a small setback doesn’t define your progress. 

Addressing debt holistically helps: Reflect on what led you here, let go of guilt, and move forward with a clear plan. Accountability is a powerful part of that plan. Involve your spouse, partner, or family and celebrate wins together. Even small progress matters — each payment brings you closer to long-term financial freedom.

FAQs

Can I pay off debt and still save for retirement or an emergency fund?

It’s possible to pay off debt and still save for retirement — the key is in how much you allocate to each savings pot. If you have a 401(k) match, contribute enough to get it — that’s free money. Even 1% can make a difference. At the same time, build a small emergency fund before aggressively paying debt, to help avoid falling back into old patterns.

Snowball or avalanche method – which works best?

Snowball works best for emotional momentum; avalanche saves the most money over the long-term. The best strategy is the one you’ll stick with.

How can I avoid taking on more debt while I’m paying off balances?

Reflect on habits, cut big expenses, and get intentional with spending. Every dollar should align with your goals. Consider creating a starter emergency fund so you don’t have to rely on credit again if faced with an unexpected expense.

Should you pay off the highest interest rate or the smallest balance first?

If you’re emotionally driven, paying the smaller debts first can help give you momentum. If you’re more motivated by the numbers, paying the highest interest would be the way to go because it’s going to save the most money in the long run.