A quick strategy for paying off credit card debt is to focus on eliminating the balance one card at a time, according to Bank of America. If a debtor carries a balance on multiple cards, paying more than the minimum amount on each card is highly recommended.Continue Reading
An individual can pay off debt quicker by comparing credit card statements and paying off the balance on the card that charges the highest interest rate, reports U.S. News. Once the first debt is eliminated, that money should be used to pay off the debt that has the second highest interest rate. Another option is to pay off the debt with the smallest balance before taking the money being paid for that debt and using it to focus on the next smallest balance. Paying the highest-interest rate card allows debtors to pay less interest over time, but focusing on the card with the smallest balance is recommended for people who prefer seeing results from short-term goals and require more motivation to stick with the strategy.
Consolidating debt allows individuals to combine multiple high-interest balances into one that has a lower rate, according to Bank of America. This helps debtors to pay down balances quicker without needing to increase payment amounts. If debtors have equity in their homes, they can use it to reduce credit card debt, as a home equity line of credit or a home equity loan can offer a lower interest rate than what credit cards charge. Another benefit to this strategy is that home equity interest payments tend to be tax-deductible.Learn more about Credit & Lending