Here Are Some Helpful Strategies To Pay Off Your Credit Card

Huge debts can be overwhelming and bring about a tremendous financial burden, primarily if you use multiple credit cards. The repayment of credit card bills can keep you on your toes and affect your financial appetite to a great extent.

Thus, it’s essential to know how to pay off a credit card bill.

You need to have a proper strategy in place in case you want to pay off your credit card bills. You can make your bill payments easy by taking it one step at a time.

Effect Of Credit Card Debts On Your Credit Score

Credit scores define your financial risk. Various lenders take this score into perspective before lending money to an individual, so suffice it to say that a bad credit score can haunt you all your life.

Credit scores get affected even if you skip a monthly payment of your credit card bill. Debt comes with a ripple effect: if not paid on time, the consequences can be troublesome.

You might have a question: what is a good credit score uk? A good credit score usually lies between 881-960. A score of 721-880 is also considered as fair. Anything below that can put you in trouble.

Types Of Debt

Debt can be of various kinds. The primary categorisation of all types of debts are done under these two central heads:

  1. Revolving Debt
  2. Instalment Debt

Revolving Debts

The debt which comes from your credit card is a revolving debt. A balance is carried or revolved from one month to another. In such debts, you can borrow a certain amount every month, maximum up to a predetermined credit limit.

Instalment Debts

This kind of debt comes from various types of loans and mortgages. You borrow a massive amount from the lender in a lump sum. Then, regular monthly payments have to be made towards your loan.

Both of these debts have an impact on your credit scores. One single default can stay in your credit report for up to 7 years. Also, these non-payments come with high interests and other additional charges. 

Strategies To Pay Off Your Credit Card Bills

Divide Your Credit Card Bill Into Portions

It is recommended that you don’t look at the total amount of your card. This can be intimidating for you if you get to see a huge amount at once. It is suggested to break your credit card bill into several categories.

Multiple credit cards’ debt should also be categorised using a similar technique. In the case of a single card, this process becomes simple. Credit card expenses can be managed well if small chunks are repaid from time to time.

Making the minimum payment is important. Make sure to do that first. Then you can buy some time for categorising and then paying off the debt.

Pay Debts With The Highest APR First

Repayment can be managed after the categorisation of your credit card bills. Start paying off those debts that have a high-interest rate. In case you have multiple cards, make sure to make payments towards the one first which comes with a higher interest rate.

You should aim at reducing your principal and the interest amount that comes with it. Therefore, you should pay back both your principal amount as well as your interest. In this way, you can manage the growing interest which accrues on one single expenditure.

Play Around With Your Credit Card Options

Various credit card options are available in the market. Why not choose the one which comes with a low cost or higher benefit? Go for a 0% APR credit card.

A 0% APR card would not charge any interest on your debt balance for a specified period. This period generally extends from 6 months to 24 months. Also, your existing credit card debt balance can be transferred to this card.

When the tenure ends, an interest rate would be applicable on your debt. This rate is decided based on your credit profile. These cards give you a decent time frame to make payments towards your debt without charging any interest on it.

What Order Should I Pay Off My Credit Cards

Pay Off The Smallest Debt Balance First

You can start paying off the smaller debts first and then move to the higher debts. For instance: If you have two credit cards, and the balance is £10,000 for one and £3,000 for the other, you should pay off the 3,000 first.

This is known as the snowball method. Paying off your debts in this way pumps up your confidence as you are done with paying off at least one of your cards. Once you are done with your low debts, you can pay off your high debts in chunks.

Using this technique would give you psychological satisfaction. Also, once you pay off your smaller debts, you can ascertain your financial situation quite well. Then, with the residual cash, start paying off your higher debts.

Consolidation Of Debt

Effective consolidation of debt can make you debt-free efficiently. Credit card bills can be paid off by taking a personal loan. A low APR personal loan would not hurt much if it is making repayments easy.

A personal loan is an unsecured loan. Consolidation of your credit card debt into a personal loan can buy you enough time to make payments towards the debt. You can easily pay off these debts in 3-5 years.

Also, this would give you enough time to shift to a credit card with better interest rates. You can save the difference in the interest using this method. Also, this would give you the necessary cash to make principal payments on time.


The minimum payment option is convenient but delays your debt payment for a month. You will have to free up a large amount of cash to pay off the substantial interest rates and annual charges that come with credit cards. Just making the credit card minimum payment can drag you into traps of debt.

But just in case you fall into the trap, make sure to categorize and consolidate. This is the best way to go while paying off your credit card debts.

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