Here’s how to break the chains of the repetitive credit card debt cycle.

4 minute read

Have you paid off a big credit card balance or multiple balances, only to find yourself deep in credit card debt again later that year? If so, you’re a credit debt repeat offender, but you don’t have to live the rest of your life in and out of the prison of debt shame.

If you struggle with getting in over your head with credit card debt, paying it off and then ending up with even more debt later, here are six steps you can take to put your repeat offender status away for good.

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1. Learn from past mistakes

Don’t waste time beating yourself up because you got your credit card down to a zero balance and then ran the balance back up several months later. The key is to learn from your mistakes so you don’t repeat the same habits that got you into too much debt in the past.

Review last year’s spending on your credit card account so you can have a better idea of how your balance grew to such a large amount. Were you paying only minimum payments? Did you charge a large purchase like homeowner’s insurance or taxes that you could have paid another way if you had saved for the expense throughout the year?

While you’re at it, take time to remember how difficult it was to pay off your credit card debt and how much you had to sacrifice to be free of that debt. Recalling the struggle to pay off credit debt in the past may stop you from letting debt spiral out of control again.

Find out: Don’t Make These 6 Mistakes When Paying Off Debt

2. Create a budget

When you create a monthly budget and stick to it, you can allocate expenses like groceries, utilities and insurance to another payment method such as a debit card or cash. That way, you can keep your credit card balance manageable so you can pay it off every month. You can also budget in money to set aside for large annual expenses such as insurance or income taxes so you don’t have to charge them on a credit card.

Find out: 20 Smart Personal Budgeting Tips

3. Build an emergency fund

How many times have you had to charge a car or home repair on a credit card because you didn’t have enough emergency savings to cover the unexpected expense? When you don’t have an emergency savings fund, you can run up a formidable credit card balance over time.

Open an emergency savings account, even if you only have $100 for the initial deposit. Then contribute regularly with a goal of saving at least $1,000 to cover emergencies so you don’t have to charge them on a credit card.

Find out: 4 Ways to Build Emergency Savings Fast in 2022

4. Pay off credit card balances each month

To prevent racking up too much credit card debt, pay off the full balance on your credit card each month. That way, you’ll avoid paying interest and keep the balance from becoming so high that it takes forever to pay it off.

Find out: How Long to Pay Off a Credit Card Balance?

5. Don’t use your credit card for everything

In many ways, using your credit card for all your monthly bills, including daily expenses like dining out, gas, entertainment and groceries, is convenient. That way, you have only one credit card bill to pay each month. If you’re disciplined enough to pay off the balance each month, this shouldn’t be a problem.

However, if you fall in and out of credit card debt repeatedly, you’re probably not disciplined enough to pay all your monthly expenses with the card and then pay the balance off every month. When you don’t pay the full balance for months, you’ll end up with too much credit card debt again and pay even more in interest. Use your debit card or cash when you can to avoid running up a high credit card balance.

Find out: 4 Times it Could Be Smart to Make a Large Purchase on a Credit Card

6. Don’t let anyone else pay off your debt

If a friend or family member offers to pay off your credit card debt, that’s a tempting offer, especially if it’s a gift rather than a loan. Depending on how much credit card debt you have, someone else paying off the card could save you hundreds of dollars in interest. Sometimes, this is not a bad option. However, letting someone else take care of your debt also has a couple of downsides.

For one thing, the person forking over a huge chunk of money to pay off your credit card may resent you for it – especially if it’s a loan you fail to repay – causing a rift in the relationship. But just as important is the fact that this makes getting out of debt too easy.

When you have to pay off a large amount of debt yourself, it can be painful. You might have to take a second job. You may have to rebuild your credit if you fell behind on payments. But when you have to make sacrifices to pay off credit card debt yourself, you’ll probably think twice before running up a huge credit card balance again.

Find out: 5 Ways to Pay Off Credit Card Debt Faster in 2022

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC