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How To Pay Off Credit Card Debt

Credit card debt can interfere with your long-term savings and spending goals. BECU's lead financial educator offers tips to help you pay off your credit cards so you can plan future purchases and prepare for the unexpected.

Katie J. Skipper (She, Her, Hers)
BECU Community Content Manager
Updated Dec 24, 2025 in: Credit & Debt

Read time: 10 minutes

Takeaways: Paying Off Credit Card Debt

Credit cards can be easy to use and difficult to pay off due to current interest rates and increasing inflation.
Paying off credit card debt typically requires an intentional strategy, including reviewing your current spending and committing to a debt payoff approach.
Avoid future debt by developing a savings plan and strategy for emergencies, short-term goals and long-term goals.

Living a debt-free life is a common goal — but paying off credit cards can feel like a never-ending battle. Pay too little, and the debt goes on forever. Pay too much, and you might not have enough in savings to cover a surprise expense.

If you carry a balance on your credit cards from month to month, you're not alone. A new November 2025 WalletHub survey found about 43% of consumers carry a monthly balance.

Credit card balances rose overall by almost 6% to $24 billion during the third quarter of 2025, and now total $1.23 trillion, according to the New York Fed. The Fed's statistics indicate that cards with payments 90+ days late have increased rapidly since 2022.

Inflation on goods and services and higher interest rates drove credit card balances up. The average household credit card debt in the U.S. was $10,951, according to the November WalletHub survey.

So, how do you pay off your credit cards, especially with rising costs and unexpected expenses? Stacey Black, BECU Lead Financial Educator, has some tips to help you break the debt cycle and be intentional about future spending.

5 Steps To Assess Your Spending

If you want to know how to pay off credit card debt, the first step is to figure out how much you spent and what you spent it on.

1. Make a List of Expenses

Start by listing everything you buy and the price. This includes monthly essentials, like utility bills, and fun expenses, like gifts and entertainment.

Review past purchases on your credit card statement or look them up on your credit card company's website. If you bought several items online from the same retailer, you can often check your order history on retailers' websites.

2. Track Your Current Spending

Black also recommends tracking your current spending for a month or two in a spending diary.

She suggests free check register apps, spreadsheets and even a notebook and pen to write down every expense, regardless of the payment method. If you use an online money management tool, you can tag your purchases.

"My advice always is to do what works for you," Black said. "The best tool is the one you'll use consistently."

3. Understand Needs vs. Wants

Determine your spending needs vs. wants. Your needs are essential expenses like housing (rent or mortgage payment), utilities, childcare, car payment and food.

Cut back where you can — but try not to eliminate all your wants. When people are too strict, they are more likely to give up and go back to overspending, so the occasional treat is fine. Even better is prioritizing a little fun and budgeting for it to avoid splurges.

4. Limit Your Credit Card Use

Only use your credit cards if you can pay off the month's spending while continuing to pay down your balances. Otherwise, you'll continue adding to the debt you're trying to reduce.

If you have credit card information saved on shopping websites or in apps, it might be too tempting to use them. Consider removing those cards from online retailers' sites.

5. Pay Attention To Spending Patterns

Sometimes deals are hard to resist, and impulse buys add up. Thinking about where and when you spent money reveals whether you've been spending more than you intended.

Maybe your favorite coffee shop appears on your statement more often than you realized. Or you're paying for a streaming service you no longer need.

Review spending for recurring special occasions, like birthdays and holidays. Because those occasions come up every year, you can decide if you're spending the right amount and include it in your monthly budget.

Once you've reviewed your spending, act on what you find: make small adjustments that free up cash for paying down debt, building savings and preparing for emergencies.

Commit to a Payment Amount

Compare your expenses with your monthly take-home income. The amount you have left after expenses is what you can put toward paying down your debt.

If your expenses are greater than your income, you have more work to do to reduce your spending.

Choose a Debt Payoff Strategy

There isn't a one-size-fits-all approach to paying off credit cards. Just like tracking your spending, Black suggests choosing the strategy right for you.

"Decide which plan is the one you can stick with and hold yourself accountable," she said. Use a credit card debt repayment calculator to see how long it will take to pay off your debt using each strategy.

If you don't have extra funds to put towards debt right now, keep paying the same monthly amount toward your debt, even when your required payments decrease so you can continue making steady progress.

Here are three popular — and effective — repayment methods:

Debt Snowball

To reduce your credit card debt using the debt snowball method, pay extra every month to your lowest balance credit card first. In the meantime, you'll also pay the required minimum on other cards.

When the lowest balance card is paid off, shift that payment you'd been making to the next lowest balance card. Continue to do this until all your credit cards are paid off.

By paying off one balance at a time, the debt snowball method helps you build momentum and continue moving toward a debt-free future.

Debt Avalanche

The debt avalanche method is like the snowball method, but instead you focus on paying off your highest interest rate card first. While doing so, you pay the minimum on the remaining cards.

Once you pay off the highest interest rate card, shift payments to the next-highest interest rate card. You'll continue to pay the minimums on the remaining cards.

By tackling high-interest debt first, the debt avalanche method can help you reduce the total amount of interest you pay over time and become debt-free faster.

Illustration of three credit cards with a dotted line that suggests moving from one card to the next. The orange card on the left is labeled "1st" and "$1,100." The turquoise card in the middle is labeled "2nd" and "$4,600." The blue card on the right is labeled "3rd" and "$9,800." — Debt Snowball: Focus on paying off your lowest balance first, then shift the payment to the next-lowest balance.

Illustration of the debt avalanche, a credit card balance from a high interest rate credit card to a lower interest rate card. A dotted line arcs from an orange credit card labeled 14.5% on the left to a yellow calculator in the middle that shows "BALANCE" in the display window. The dotted line then arcs to a red credit card labeled 5.0% on the right. — Debt Avalanche: Focus on paying off your highest interest rate first while paying the minimum on your other cards. Then shift the payment to the next-highest interest rate.

Debt Cascade

Use the debt cascade method if all you can afford is the minimum payments on your credit cards.

As you pay down your credit cards, your minimum payment will likely decrease. Even if a $50 minimum payment becomes $25, keep paying the original amount. This will speed up your progress and help your debt fall faster over time.

Once you pay off one credit card, redirect the funds you were using to another card, using one of the methods above.

Consider Balance Transfer Credit Cards

Taking advantage of a low-interest or no-interest balance transfer credit card offer can be a great way to reduce your debt. Do the math before you try this solution, because it might cost you the same or more in the long run.

Black advises asking yourself these questions before you make the switch:

Will I qualify for the low-interest or no-interest balance transfer credit card offer? Any application will drop your credit score by a few points.
Can I avoid adding more debt? With a new card, you might qualify for a higher credit limit (and accompanying high interest rate) that you'll feel tempted to use.
Can I repay the debt in time? If the no-interest balance transfer credit card lasts 12 months then jumps sky-high, ensure you can pay off your debt within that year.
Can I make the transfer fee worthwhile? Keep in mind that most credit cards charge a balance transfer fee. Some range from 3% to 5% of the amount you plan to transfer. Balance this fee against the interest you'll save.

An illustration of a turquoise credit card with red arrow to the right of it labeled "%" and pointing down toward a red checkmark in a circle. — A balance transfer offer can help you reduce debt but do the math to make sure it won't end up costing you more.

Balance Transfer Calculator

First, figure out how much you can pay off during the promotion period. Next, use a debt repayment calculator to see how long it will take to clear the remaining balance and what interest you'll pay at the new rate.

For help, try Credit Karma's free and easy-to-use balance transfer calculator.

Then decide if it's worth it to apply for more credit. As with any credit card offer, read the details before you apply.

Research Debt Consolidation Loans

Debt consolidation loans can be another great tool for debt reduction. These personal loans typically have lower interest rates than credit cards, particularly for those with good credit. You repay the balance in fixed amounts over a series of several years.

But use caution.

"Before you take out a loan, it's important to create a budget and really know where you stand," Black said. "Think about your financial situation and how you got into debt in the first place."

If you have too many financial obligations or you don't have control over your spending behavior, you'll likely start charging your purchases again on your now $0 balance card. You could end up with even more debt than you started with.

Save for the Future

Having a strategy to get out of debt and sticking to it is great. But a savings plan can prevent you from going into debt again when you make your next big purchase, or in event of an emergency. Start saving now while you're paying off credit card debt.

1. Set a Savings Goal

Identify any high-cost future goals you're planning for, such as a vacation, gifts for family, or a new car purchase. Estimate how much you'll need in total.

Then, break that amount into manageable pieces to set a realistic savings goal. You might divide the total by the number of months you have to save, or by the number of paychecks you'll receive, and set aside money regularly as you get paid.

2. Separate Your Money

If you put all your money in one place, keeping track can be difficult, making funds easier to spend. So, consider opening separate accounts.

Nickname your accounts based on what you're saving for — "New Car" or "Holiday Savings," for example, and use those accounts only for that named purpose.

You can also use digital tools to separate your money into different savings categories without opening new accounts. BECU Envelopes is an example.

3. Set Up Automatic Savings

Most credit unions and banks have automatic savings plans. These plans transfer a fixed amount of money automatically from your checking account or paycheck into your savings account. Setting up automatic transfers to savings makes it easy to "set it and forget it," so you don't have to remember to move the money and you're less tempted to spend it.

Stick to It

Now you know how to pay off credit card debt and save money for future spending — both your needs and your wants.

"It takes time and commitment to get out of debt and break that cycle," Black said. "But it's such a relief for people when they are finally debt free."

FAQs

What If I Have Too Much Credit Card Debt to Pay Off?

If you have too much credit card debt, it's wise to get help from a trusted resource. BECU partners with GreenPath Financial Wellness to offer free financial counseling for members, including creating a debt management plan. This plan helps identify debt repayment options, including lower interest rates and repayment approaches.

What's the Fastest Way to Pay Off Credit Card Debt?

Often, the fastest way to pay off debt is by combining an approach to tackle high-interest balances ("debt avalanche") or lowest balances ("debt snowball") with the following:

Stop using credit cards to avoid adding new debt
Increase income through side gigs or extra work
Reduce expenses and put the savings toward debt
Use lump sums like tax refunds or bonuses to pay balances down
Consider consolidation loans or balance transfers to lower interest or simplify payments

Use caution with consolidation loans and balance transfers. They work best after spending habits have changed. Otherwise, it's easy to take on new debt while still paying off old balances.

What Is a Normal Amount of Credit Card Debt?

The average per-person balance for credit cards is $6,730 according to WalletHub. This can be a helpful reference point, but what matters most is whether your payments fit comfortably in your budget. If credit card debt is causing stress or slowing your goals, consider using a debt reduction strategy. BECU members can get started with a free Financial Health Check to explore personalized options.