How to get out of credit card debt

Practical and simple steps you can take to pay off your credit card balance for good.

If you’re struggling to deal with credit card debt, following a debt relief plan can help get you back on the path to financial freedom. If you need a little more help than that, there are free services you can access for personalized assistance and advice.

Since there’s plenty of advice out there, you’ll want to make sure it’s reputable and realistic advice. If you’re looking for some steps to take to start paying off your credit card debt, we’ve got seven simple ways below.

Seven ways to get rid of your credit card debt

These steps are designed to form a path to financial freedom – but even following them one at a time will help you along the way.

    1. Avoid making new purchases. To get rid of your debt, you have to stop adding to it. Stop spending and start using that money to pay down your existing balance. Remember that your ultimate goal is to be debt free. You can treat yourself again once you’ve achieved that.
    2. Calculate the total amount of money you owe. It’s time to face the hard truth. This process might be painful, but it’s necessary and short-lived. Get all your account balances together and make a list. Include your debt amounts, the interest you’re paying on each of those amounts and any other charges. Add them up and take a good, long, hard look before you say your goodbyes.
    3. Create a budget. Start with your monthly income and figure out your essential monthly expenses. It’s time for tightening measures, so expenses should include only the bare necessities such as bills, groceries, gas and other living expenses you need. After establishing your income and expenses, it’s time to create a monthly schedule for repaying your debts. Work out how much you can pay off each month, but be realistic and leave breathing room for any emergencies.
    4. Set up automated payments. Using your budgeted monthly payment amount, set up automated payments to make sure you actually pay what you plan to. Set up the payments to come out of your bank account the day after you get paid — this is a sure-fire way to stay committed to your budget.

Debt consolidation options

Compare debt consolidation loans

Name Product Min. Loan Amount Max. Loan Amount APR Fees Loan Term Min. Credit Score
$500
$20,000
26.99% - 39.99%. Varies by loan type and province
Varies by province
6 months - 5 years
550
Fairstone offers small to medium personal loans up to $20,000.
$2000
$35,000
5.9% - 45.9%
NSF fee - $20 to $48
2-5 years
540
Mogo offers loans up to $35,000 on flexible terms.
$5000
$30,000
19.99% - 23.99%. Varies by loan type and province
Varies by province
3 - 10 years
550
Fairstone offers secured personal loans up to $30,000.
$2000
$10,000
43% (British Columbia and Ontario) and 34.9% (Quebec)
None
1-5 years
N/A
LendingMate offers loans to Canadians with poor credit with no credit checks.

Compare up to 4 providers

Compare balance transfer credit cards

Name Product Welcome Offer Purchase Interest Rate Cash Advance Rate Balance Transfer Rate Annual Fee
Offers a 0.99% introductory interest rate on balance transfers for the first 6 months upon card membership. Ends 30 June 2019.
12.99%
12.99%
0.99% for the first 6 months (then 12.99%)
$29
Save on interest by consolidating your higher-rate balances and enjoy a low 12.99% purchase interest rate.
Earn up to 5% or $300 cashback in your first six months.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$99
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Earn up to 2.5% or $150 cashback in your first 3 months.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$0
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Receive 2,500 bonus SCENE points when you spend your first $500 in eligible purchases in the first 3 months of membership (valid for new accounts opened by June 30, 2019).
19.99%
22.99%
22.99%
$0
Earn 1 SCENE point per $1 spent on all purchases, plus 5 SCENE points for every $1 spent at Cineplex Entertainment theatres or cineplex.com.
Get 1.95% interest rate on balance transfers for the first six months. Valid within the first 30 days of account opening.
19.95%
19.95%
1.95% for the first 6 months (then 19.95%)
$0
Earn 4% Money-Back Rewards in three categories of your choice such as groceries, dining, petrol and more. Ends 31 July 2019.
Offers a 3.99% introductory interest rate on balance transfers for the first 6 months when your new credit card account is opened by June 30, 2019.
16.99%
16.99%
3.99% for the first 6 months (then 16.99%)
$0
Enjoy a low interest rate and no annual fee.
No available introductory offer.
17.99%
17.99%
17.99%
$0
Enjoy up to 5% in GM Earnings on your initial spend of $5,000 in the first year.
Receive 10% cash back on the first $2,000 in eligible purchases within the first three months of card membership (account must be opened by June 30, 2019).

19.99%
22.99%
22.99%
$0 annual fee for the first year ($99 thereafter)
Earn 4% cash back on gas & groceries, 2% cash back on drug stores and recurring bills and 1% cash back on all other spend.
Receive 30,000 bonus Scotia Rewards points when you spend your first $1,000 in everyday eligible purchases in the first 3 months of membership (offer ends June 30, 2019).
19.99%
22.99%
22.99%
$139
Earn 2x Scotia Rewards points per $1 spent on eligible grocery stores, dining, entertainment and daily transit purchases. Plus, an extra 10,000 points when you spend a min. of $40,000 annually on your card.
Enjoy a 7.99% introductory interest rate on all spend for the first six months when your new credit card account is opened by June 30, 2019.
7.99% intro APR for the first 6 months, 19.99% thereafter
22.99%
22.99%
$0
Receive 1% cash back on payments made at gas stations, grocery stores and pharmacies, including recurring payments. Plus, 0.5% cashback on all other eligible purchases.
Enjoy a 2.99% introductory interest rate on balance transfers for the first 6 months when your new credit card account is opened by June 30, 2019.
19.99%
22.99%
2.99% for the first 6 months (then 22.99%)
$39
2% cash back on all eligible gas station, grocery store, drug store purchases and recurring payments.
Receive 5,000 bonus Scotia Rewards points when you make your first eligible purchase within 2 months of membership (account must opened by June 30, 2019).
19.99%
22.99%
22.99%
$110
Earn 5% cash back on travel purchases via Scotia Rewards Flexible Point Redemption, plus 1 Scotia Rewards point on daily eligible purchases.
Receive 30,000 bonus Scotia Rewards points upon first eligible purchase within 2 months of membership. Valid for new accounts opened by June 30, 2019.
19.99%
22.99%
22.99%
$399
Earn 4x Scotia Rewards points per $1 spent at grocery stores, gas stations, dining and entertainment purchases. Enjoy complimentary membership to global priority pass airport lounges.
Receive 5,000 bonus points when you spend $500 in eligible purchases within your first 3 months of membership. Valid for new accounts opened by June 30, 2019.
19.99%
22.99%
22.99%
$0
Book and redeem travel via Scotia Rewards Travel Service, plus receive 1 Scotia Rewards point on all eligible purchases.
Enjoy a waived annual fee for the first year of membership. Valid for new accounts opened by June 30, 2019.
19.99%
22.99%
22.99%
$0 annual fee for the first year ($79 thereafter)
Enjoy up to 5% in GM Earnings upon initial spend of $10,000 in the first year and 2% subsequently.
Receive 2,000 bonus AIR MILES Reward miles when you spend $1,500 within the first three months of membership.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$65
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Receive 500 AIR MILES Reward Miles when you spend $500 within your first three months of membership.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$0
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Offers a 7.99% introductory interest rate on all spend for the first 6 months when your new credit card account is opened by June 30, 2019.
19.99%
22.99%
7.99% for the first 6 months (then 22.99%)
$0
Receive 1% cash back on payments made at gas stations, grocery stores and pharmacies, including recurring payments. Plus, 0.5% cashback on all other eligible purchases.
Receive 2,400 Air Miles Reward Miles when you spend $3,000 within first three months of membership.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$299
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Get 15,000 bonus Scotia Rewards points with min. spend of $1,000 on eligible purchases within the first 3 months of membership. Ends 30 June 2019.
19.99%
22.99%
22.99%
$99
Earn 4 Scotia Rewards points per $1 on the first $50,000 annual spend on eligible purchases.

Compare up to 4 providers

What if I have multiple credit card debts?

  • Consolidate your debts onto one card. This follows on from step 7, where you can consider a balance transfer credit card to help with your debt consolidation. As well as giving you the opportunity to save money on otherwise expensive interest fees for a promotional period of time, you can also focus on only paying off one account. It could also help you save on additional charges, such as annual fees.
  • Pay off the card with the highest interest rate first. You’ll save the most money by paying off the account with the highest interest rate first, followed by the account with the next highest interest rate and so on. Remember that you’ll still have to make minimum payments on your other cards during this time.
  • Pay off the card with the lowest balance first. For some people, paying off the card with the lowest balance first is more motivating. This strategy will reduce the number of outstanding accounts sooner and cuts down on interest charges in the process. Of course, you’ll also need to make minimum payments on your other cards at the same time.

Read our complete guide to balance transfer cards

Other tips to help get rid of credit card debt

In addition to the steps above, following these tips can also prove very helpful:

    • Switch to a card with a lower annual fee. This helps with reducing overall expenses, but can be doubly effective when combined with a balance transfer offer. If you want to minimize your outgoing card fees, you should consider a 0% balance transfer credit card with no annual fee.
    • Cancel cards you don’t use. This tip will help save on annual fees and other charges that you may be paying on your cards. Also, this will help reduce the temptation to spend more money.
    • Use your savings. Since your savings account could never offer an interest rate as high as the one you’re probably paying on your credit card, it follows that you should be using your savings to pay off your credit card debts. Use the cash under your bed, that rainy-day fund and every penny you can find to pay off those debts – because they’ll just swell up with interest if you don’t. Once they’re paid off, you’ll have more money you can put towards your savings to build them up again.
    • Make weekly payments. Even though your statement comes monthly, credit card interest is actually calculated on a daily basis. This means that increasing the frequency of your payments can help to reduce the total interest you pay over time. Whenever you have an extra dollar, consider paying off more of your credit card balance.
    • Seek professional help. Gaining control over your debts can be very difficult, especially at the beginning and it can be helpful to get professional advice. You can often find a range of free services online for debt management.

Bottom line

Credit card debt can often seem overwhelming, but by setting a budget, planning out your strategy and/or getting a debt consolidation loan or balance transfer card if you need one, you can get rid of credit card debt and make lasting, sustainable changes to your financial life. However, if after assessing your situation you still find yourself in a position where you don’t think you’ll be able to make meaningful progress toward paying off your debt, it may be time to consider debt relief as a solution.

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