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Start, Stop, Keep: 3 Simple Steps to Conquer Your Credit Card Debt

By Nicole Bustamante

Ok, we know what you’re thinking: tackling credit card debt? In this economy? 


It’s all too easy to find yourself swimming in credit card debt these days, especially given the challenging financial landscape that has left many in the U.S. jobless or underemployed. Plus, after a year of being cooped up at home, the impulse to self-soothe with a little retail therapy is all too real.


But there are good reasons to get your credit card habit under control: debt can affect your mental health and even your personal relationships. So, instead of letting it hold you back, we want to empower you with real ways to address it. 


It takes time, determination and commitment to defeat your debt—but we have no doubt that you can do this. We’ve created a simple framework: habits to stop, habits to start, and habits to continue so that you can set yourself up for a debt-free future. Read on to learn how to kick debt to the curb and develop healthy financial habits to carry with you forever.


Stop: Accumulating Debt


If you’re stressed about your credit card debt, first know that you are not alone. A May 2020 poll from shows that 47% of U.S. adults currently carry some amount of credit card debt. 


Whether you are struggling to balance bill payments with unexpected expenses, or simply have an online shopping habit that needs some reigning in, it’s important know that there’s no shame in recognizing the problem. After all, that’s the first step towards making a positive change.


Here are a few common (and avoidable!) reasons why people tend to fall into credit card debt.


1. You charge more to your card than you can feasibly pay off.


On a day-to-day basis, you may be charging more to your credit card than you can reasonably expect to pay off. If you accrue debt from other large, unexpected purchases (more on that below) on top of your day-to-day spending, your debt will continue to grow unless you take actionable steps to pay it off.


2. You don’t have an emergency fund.


For many people, a single medical bill or unexpected car repair can sink them deep into debt. While sometimes putting the bill on a credit card may seem like the only option, it should be a last resort: doing so means accruing monthly interest on top of the original amount. Instead, aim to set aside a small amount each month so that you’re ready for any emergency expenses that come your way.


3. Your approach to budgeting needs a refresh.


If you aren’t budgeting properly to begin with, then you are likely to continuously overextend your finances and in turn, grapple with credit card debt. In addition to your day-to-day cash flow, make sure you work a pay-off plan for larger expenses into your budget. Deferring debt repayment instead of facing it head-on is a common way to dig yourself a deeper hole.


Start: Paying Off Debt


Taking down your credit card debt is very similar to how you would handle paying off any other kind of debt, from student loans to a mortgage. But let’s get specific: here are the steps you can take to pay off your credit card debt for good.


1. Assess your spending habits and make a plan.


Take a long, hard look at your current outstanding debt and expenses alongside your daily, weekly, and monthly spending. After making a realistic assessment of how those stack up against your income, you’ll want to do two things: adjust your monthly spending, and put together a plan to pay off your debt. 


When it comes to the latter, there are two main strategies to consider:


The Snowball Method: Start by paying off your smallest debt amounts first. Once you pay one off, you work your way up to the larger debts. This method takes a little bit longer, but tends to feel more rewarding.


The Avalanche Method: This method is quite the opposite. With an avalanche plan, you start by paying off the cards with the highest interest rates and then work your way to the smaller ones. This strategy tends to be quicker, but may not give you quite the same dopamine hit in the short term that you’ll get with the snowball method.


2. Pay off more than the card minimum each month…


When you’re overwhelmed by debt, it can be tempting to pay off the minimum each month and move on with your life. But this approach will actually keep you in debt for longer, as interest continues to accrue on your remaining balance. If you are able to put even a few extra dollars each month towards your repayment, not only will you pay off your debt faster—you’ll also save yourself the temptation of spending that extra cash on non-essentials!


3. …and always pay on time.


At the risk of repeating ourselves: always pay your credit card on time. If you push off a payment, you’ll face the daunting task the next month of catching up with your payment along with whatever late fee your credit provider charges. To avoid missing a payment or racking up any late fees, you can set up an automatic payment each month.


4. Talk to your credit card issuer.


If you’re really struggling to keep afloat, get in touch with your issuer about your current circumstances. Some creditors have hardship programs where they can offer lower interest rates or waive fees if you are facing unemployment or a major illness.


Keep: Developing Healthy Habits


Once you’ve successfully paid down your debt, you’ve got to continue the hard work to keep it that way. Here are some of our final tips and tricks to continue your good habits.


1. Cut down on the total number of credit cards you use.


It’s best not to tempt yourself with limitless amounts of credit to work with. Minimize the number of cards you have to help rein in your self-control and avoid overspending. Consider credit alternatives like buy now, pay later to increase your spending power in the short term without the high interest of a credit card.


2. Build up your emergency savings.


You never truly know when an emergency can happen, so it’s important to set a small amount of each paycheck aside for a “safety net” savings account. Start small, and build your way up. 


3. Don’t rely on balance transfers.


Transferring your balance to a 0% interest card can be a great idea if you do it extremely sparingly. Don’t get too comfortable with transferring balances in an effort to outrun your debt, though—the transfer fees will catch up to you.


4. Keep your debt to credit ratio low.


Essentially, don’t max out your credit card each month. According to CNBC, “Lenders and creditors generally prefer to see a credit utilization rate of under 30%, and it’s even better to shoot for the lowest percentage possible (less than 10%) to get the best credit score.”


5. Use buy now, pay later services like Zip.


Manage your credit card expenses by avoiding putting them on your credit card at all! With buy now, pay later apps like Zip, you can pay off an item in four installments over six weeks without ever touching your credit card.


Download the Zip app to check out the better way to pay and start splitting your payments in 4 anywhere you shop.

Get started with Zip today

Zip’s editorial content is not written by a financial advisor. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.

About the author
Nicole Bustamante

Nicole Bustamante is a writer and journalist passionate about storytelling and the art of fashion. She has written for The Zoe Report, Angeleno Magazine, Modern Luxury Interiors California, and more in addition to writing for her personal blog.