[et_pb_section fb_built=”1″ _builder_version=”4.16″ _module_preset=”default” custom_margin=”||||false|false” custom_margin_last_edited=”off|desktop” top_divider_style=”curve2″ top_divider_color=”#e7dff3″ top_divider_flip=”horizontal|vertical” bottom_divider_style=”curve2″ bottom_divider_color=”#5b25af” bottom_divider_height_tablet=”80px” bottom_divider_height_phone=”50px” bottom_divider_height_last_edited=”on|phone” da_disable_devices=”off|off|off” global_colors_info=”{}” theme_builder_area=”post_content” da_is_popup=”off” da_exit_intent=”off” da_has_close=”on” da_alt_close=”off” da_dark_close=”off” da_not_modal=”on” da_is_singular=”off” da_with_loader=”off” da_has_shadow=”on”][et_pb_row _builder_version=”4.16″ _module_preset=”default” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_column type=”4_4″ _builder_version=”4.16″ _module_preset=”default” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_text _builder_version=”4.27.2″ _module_preset=”default” hover_enabled=”0″ global_colors_info=”{}” theme_builder_area=”post_content” sticky_enabled=”0″]<\/p>\n
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We are often asked \u2018How do you pay off a credit card?\u2019 The majority of Canadians have multiple credit cards, and for a lot of people, it seems like their balances continue to grow larger and larger. While you may faithfully make your minimum payments every month, it may seem like you\u2019re hardly making a dent in your balances.<\/p>\n
So if you want to pay down a credit card, where do you start? The best place to start is to first realize that there isn\u2019t one silver bullet solution to paying off credit cards. Any solution to reduce or eliminate credit card debt will involve a number of steps. Below we\u2019ll show you some of the most effective approaches, but you can also\u00a0see a more extensive list here<\/a>.<\/p>\n If you\u2019re only making the minimum payments on your credit cards, it will take years, even decades to pay off your balances. To pay off your credit cards faster<\/a>, try to make more than the minimum payment, even if it\u2019s adding an extra $50 a month onto the card. \u00a0Doing this will pay down each card balance more quickly, save you considerable interest charges, and provide peace-of-mind as you take action to pay off your credit cards. Try our financial calculator, where you can enter your card payment information and see how much you can save when you pay more than the minimum.<\/p>\n In life, we usually find it encouraging to see progress being made on something we\u2019re working hard at. This is never more true than when it comes to paying off debt. There is a very popular debt reduction strategy called the Snowball Method that plays off this feeling. With this method, you focus on paying off your debts with small balances first and save your larger debts for last. Not only does racking up some quick successes create a great feeling, but the Snowball Method provides a powerful psychological effect for a lot of people who feel that progress is being made sooner in paying off their debts and are really encouraged to stick with their plan.<\/p>\n 2. Don\u2019t keep the money that you were using to pay off the previous card, instead use that money to start paying down your next smallest credit card balance. Continue to pay this credit card until it is paid in full. The key objective is to free up money that can now be used to pay off larger amounts of debt.\u00a0 You are essentially creating a snowball effect that is helping you pay off your credit card debts<\/a>.<\/p>\n 3. As you use this method, the snowballing monthly payments will continue to pay your debts down faster and faster as you go, and you\u2019ll get more motivated as you successfully pay off one card after another.<\/p>\n To find money to accelerate your credit card payments, look for expenses in your budget to cut back on,\u00a0look for it in these places<\/a>, or\u00a0try some of these ideas<\/a>.<\/p>\n There isn\u2019t just one solution to the question \u2018How do you pay off a credit card?\u2019 We\u2019ve found that some people who are really struggling with their debt would rather just talk with someone directly, get help putting together a plan to pay off their debt, and find out about debt relief options that may be available to them. A lot of people don\u2019t know that in Canada there are a number of debt relief programs that can help eliminate debt quickly. Credit\u00a0Counsellors\u00a0who work at non-profit organizations are actually experts in helping people explore all these options. Many credit\u00a0counselling\u00a0organizations even offer one of these debt relief options for people who are struggling with their debt. It\u2019s called a Debt Management Program.<\/p>\nTrack Your Expenses & Create a Budget<\/h2>\n
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Many people don\u2019t know how much they\u2019re spending in a month, so\u00a0it\u2019s important to track your expenses<\/a>\u00a0in order to evaluate where your money is actually being spent. After this,\u00a0create a budget or spending plan<\/a>\u00a0that allows you to determine in advance whether you will have enough money to do the things you need to do or would like to do. To learn more about budgeting and why it\u2019s important,\u00a0check out our budgeting resource page<\/a>.<\/p>\nPay More than the Minimum<\/h2>\n
The Snowball Method<\/h2>\n
How Does The Snowball Method Work? – How Do You Pay Off A Credit Card Using It?<\/h2>\n
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1. Focus on your credit card with the smallest balance first. Use any extra money you can come up with to make payments on this card. Once this card is paid off in full, this will give you a quick win and a sense of accomplishment.<\/p>\nDebt Relief<\/h2>\n
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What is a