I’m a Money Expert With $10k in Credit Card Debt. Here’s How I’m Paying It Off

2024 is a big year for my family, and it’s not going well. My partner lost his job, our dog was diagnosed with cancer, and a family member had a stroke.

As a personal finance expert, I pride myself on being able to take risk into consideration. i have one high yield savings account I know better than most credit card debt trap. So how did I find myself in this situation?

Life is unpredictable and sometimes we don’t have the resources to handle what comes our way. As a result, according to recent data, 45% of American households carry credit card debt. Consumer Finance Surveywhich shows that I’m not alone in my struggles.

I have slandered credit cardbut through my work and life experiences, I now realize they are a tool. Although debt is morally neutral, if it’s more than you bargained for, it can put you in financial trouble. By eliminating common criticisms related to debt and creating a clear plan, we can get our balances to zero faster.

Here’s how I paid off $10,602.27 in credit card debt in six months.

It’s important to note that some of your credit cards may have Introductory rates. For example, the My Care Credit card had an interest rate of 0% until March. Then, the interest rate shot up to 32.99%.

Have an emergency fund

One of the reasons I’m in so much debt is that my emergency fund isn’t as big as I’d like it to be. Currently, I am able to pay off my caregiving credit card with money I have in my savings account. I chose not to do this because this savings was my only defense against debt.

This is why having an emergency fund is so important. If you don’t save cash, you could end up with more debt that will be harder to get out of.

Pro Tip: If you’re paying off debt and don’t have an emergency fund, at least prioritize saving one month’s expenses Acts as a safety pad. This will help you avoid further debt and maintain flexibility when dealing with unforeseen circumstances.

Create a debt repayment plan (and stick to it)

There are many debt repayment plans out there. The best one is the one you stick with.

I will use debt snowball method. The debt snowball method prioritizes paying off the debt with the lowest total amount owed. By paying the minimum on your other debts, you free up more money to allocate to the smallest balance. Once the debt with the lowest total amount owed is paid off, you can apply the amount you paid on that debt to the second-lowest debt on the list.

The reason I chose this method is because of the introductory rate for nursing credit. While the 0% interest rate was helpful while my dog ​​was undergoing cancer treatments, I didn’t want to be charged a 33% interest rate when I could pay off the remaining balance quickly before then. After paying off the Care Credit card, I will move to the Discover card and finally the Amex card.

Budget extra money to pay down debt

I sat down and crunched the numbers over the past few months. I categorized average expenses and created a realistic monthly Budget. Although the budget is tight, I am committed to sticking to it so that I can pay off as much debt as possible each month.

I also invest any “additional” funds, including commissions, sideline Income, gift funds and debt tax returns. (I’d rather use the money to fix my permanently broken hot tub, but I’ve committed to paying off debt first.)

remember to have fun

Paying off high-interest credit card debt was important to my financial journey, but it wasn’t the only important step. A few years ago, if you had any kind of debt, I would tell you to just focus on debt repayment. Now I know sustainable debt repayment is more important.

I encourage myself to have fun while paying off credit card debt. I still go on vacation this fall, I still order DoorDash, I still buy snacks for myself here and there. It may seem counterintuitive, but spending money on yourself and achieving financial balance is key to staying motivated while paying off debt.

Your debt repayment journey doesn’t have to be all or nothing

It may take you longer to pay off your debt, but you’ll hate your life a lot less in the process, and you’ll avoid going backwards or stopping altogether. Sustainability and longevity are what you should aim for in your money journey.