Suze Orman's tips to beat credit card debt | finder.com

Suze Orman’s credit card tips

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Suze Orman is a genius when it comes to tips that may help you get out of credit card debt once and for all.

Suze Orman

Suze Orman

  • Suze Orman is an author, financial adviser and motivational speaker
  • Suze has a B.A. in social work
  • Hosted the “The Suze Orman Show”

Some people use their credit card to help pay bills and buy necessities. But, if you are broke because you just enjoy spending money on credit, you need to be ready for a change.

The same strategies can be used to help get you out of debt whether you are in this situation due to necessity or indulgences. The idea is to pay the lowest interest rate possible, as quickly as possible, without falling into all of the credit card traps the companies have in fine print.

Lower the interest rate

  • Negotiate. If you have a good credit history and have been making the minimum payment on your card on time every month, you may be able to negotiate a lower rate with your credit card company.
  • Balance transfer. Transfer your debt to a card with a lower interest rate and save on interest. Let your current card provider know that you will have to do a balance transfer if your rate is not lowered and they may give you a better deal because they do not want to lose your business. It is important to not make any purchases on the new card as this will completely cancel out any benefits of switching cards.
Did you know?

If you have a good credit card history and have been making at least the minimum payments per month, then you should not cancel your old cards. They hold a history of your payments that influence your credit rating. All you really need to do is cut them up so that you cannot use them, without canceling your cards completely.

Be sure to make payments

Per the fine print in most terms of conditions, any time you make a late payment, your 0% deal is terminated. Even if you are making regular payments on your new 0% interest rate card, credit issuers will be watching your credit reports to see if you have been late with payments on any of your other cards, not just theirs. This can cancel out the zero deal in some cases as well.

What are credit card companies getting from offering a 0% interest rate?

They want you to make a mistake using the card so they can stop the 0% interest rate and start charging you a 20% or higher rate of interest. Always pay your credit card bills before the due date. If you are mailing in the payment, mail it out five days before it is due.

If you do not qualify for a 0% deal Suze Orman says…

It’s time to start working on changing your credit history so that you can qualify later.

  • Credit score. You can boost this by paying at least the minimum on your monthly payment every month on time. After you have done this for a while your score should start to rise.
  • Debit to credit limit ratio. It is never wise to exhaust your entire credit limit. By keeping a low balance that is a fraction of your available credit limit, your ratio will decline and your credit score should go up. If you do not see it rising you can call up your credit card company and ask them to boost your credit limit — only if you’re sure you can control your spending. By raising this limit your ratio is going to fall because your balances will stay the same.

Working with high interest rates

List your credit cards in order of high interest rate first and low interest rate last. Ignore the balances on all of the cards while you are doing this. Once you have gathered these cards, make sure you make all of your minimum monthly payments on time, but add a little extra to the payment for the card with the highest interest rate.

You can save thousands of dollars in interest charges by pushing hard and making your extra payments as big as you can. Continue this way until the first card, the one with the highest interest rate, is totally paid off. Then start doing the same with the second card in line. Any extra payments that you were able to pay on the first card should be applied to the second one now.

Always keep track of your credit rating until you find that you are able to qualify for a 0% or low rate balance transfer. This is one of the credit card tips you must keep in mind and not forget.

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Pay off your credit card wisely

A credit card debt is unsecured, so if you cannot repay the debt, they cannot come after your assets to repay the money.

  • Home equity line of credit. A home equity line of credit is secured, so if you miss your payments your bank can use your collateral, which is your home, as a payment. You can be forced to sell your home in order to pay off the balance — you should never offer your home as collateral to get out of a credit card situation.
  • Retirement funds. You should also never borrow money using any of your retirement savings either. Some of these loans will be subject to double taxing once you have reached the age of retirement and have different requirements that must be fulfilled where you could possibly lose all of your savings. You may also have penalties and fees to pay as well.

Credit counseling

A good credit counselor will go over your entire financial situation before anything is proposed. You’ll typically be required to go to some classes to get help with money management techniques and to learn better spending habits.

Suze Orman also goes on to say that a debt management plan may be the right thing if you have stopped making payments altogether. A payment schedule will be set up with the credit card companies that is mutually agreed on by both of you. You may not be able to qualify for this plan if your counselor doesn’t think that your credit card debt can be handled within a few years time.

Don’t get ripped off

With the amount of debt problems on the rise it is not surprising that some credit counseling companies are taking advantage of the situation by charging extremely high rates for advice. Be careful when choosing a credit counseling company and make sure that they are fair and honest. You can ask for references if you need any help picking one out.

Also make sure that you only have to pay one fee monthly and not one for each separate credit card. Understand all of the terms of repayment and get everything explained in writing before you go ahead and sign anything at all.Back to top

Compare credit cards

Rates last updated June 25th, 2018
Name Product APR for Purchases ( Purchase Rate ) Intro APR for Balance Transfer Annual fee Product Description
Amex EveryDay® Credit Card
14.74% to 25.74% variable
0% Intro APR for 15 months
$0
Earn 15000 Membership Rewards® Points after you use your new Card to make $1,000 in purchases in your first 3 months.
Deserve® Classic Card
24.49% variable
$39
Designed to help build credit history with no deposit required and access to benefits.
Apply now Read review
Bank of America® Cash Rewards Credit Card
14.74% to 24.74% variable
0% Intro APR for 12 statement closing dates (with whichever is greater, $10 or 3% balance transfer fee)
$0
Earn more cash back for the things you buy most.
Blue Cash Everyday® Card from American Express
14.74% to 25.74% variable
0% Intro APR for 15 months (with whichever is greater, $5 or 3% balance transfer fee)
$0
Earn $150 back after you spend $1,000 in purchases on your new Card in your first 3 months. You will receive the $150 back in the form of a statement credit.
Luxury Card Mastercard® Black Card™
16.49% variable
0% Intro APR for first 15 billing cycles (with whichever is greater, $5 or 3% balance transfer fee)
$495
Mastercard Black Card members receive an annual $100 air travel credit toward flight-related purchases including airline tickets, baggage fees, upgrades and more.
Apply now Read review
Chase Sapphire Preferred® credit card
17.49% to 24.49% variable
$0 annual fee for the first year ($95 thereafter)
Earn 50000 points when you spend $4,000 on purchases within the first 3 months of your account opening, and an additional 30,000 points when you spend a total of $30,000 on purchases within the first year of your account opening.
Indigo® Platinum Mastercard® Credit Card
23.9% variable
$75 annual fee for the first year ($0 to $99 thereafter)
With this card you get a 23.9% variable APR.
Apply now Read review
The First Access VISA® Credit Card
29.99% variable
$75 annual fee for the first year ($48 thereafter)
Access credit even if you have poor or limited credit history.
Apply now Read review
Luxury Card Mastercard® Gold Card™
16.49% variable
0% Intro APR for 15 billing cycles (with the amount of each transfer, $5 or 3% balance transfer fee)
$995
Earn points every time you spend. Luxury Card enhances your purchasing power by providing you with one (1) point for every one dollar ($1) you spend. Every purchase gets you closer to the rewards you want.
Apply now Read review
Chase Sapphire Reserve®
17.49% to 24.49% variable
$450
Earn 50000 BONUS POINTS after spending $4,000 on purchases in the first 3 months from account opening* — that's $750 toward travel when you redeem through Chase Ultimate Rewards®.
Credit One Bank® Visa® with Free Credit Score Tracking
17.49% to 25.49% variable
$0 to $75 first year annual fee for the first year ($0 to $99 thereafter)
Get 1% cash back rewards on eligible purchases including gas, groceries, and services such as mobile phone, internet, cable and satellite TV, terms apply.
Apply now Read review
Amex EveryDay® Preferred Credit Card
14.74% to 24.74% variable
0% Intro APR for 12 months (with whichever is greater, $5 or 3% balance transfer fee)
$95
Earn 15000 Membership Rewards Points after you use your new Card to make $1,000 in purchases in your first 3 months.
Chase Freedom Unlimited® credit card
16.49% to 25.24% variable
$0
Earn unlimited 1.5% cash back on every purchase – it's automatic. No minimum to redeem for cash back.
Bank of America® Premium Rewards® Credit Card
17.49% to 24.49% variable
$95
Earn unlimited 2 points for every $1 spent on travel and dining purchases and 1.5 points for every $1 spent on all other purchases.
Quicksilver® from Capital One®
14.49%, 20.49% or 24.49% variable
0% Intro APR for 15 months (with 3% balance transfer fee)
$0
Earn unlimited 1.5% cash back on every purchase, every day
Chase Freedom® credit card
16.49% to 25.24% variable
0% Intro APR for 15 months (with whichever is greater, $5 or 5% balance transfer fee)
$0
Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate and unlimited 1% cash back on all other purchases.
Bank of America® Travel Rewards Credit Card
16.49% to 24.49% variable
$0
20,000 online bonus points offer. Ditch the restrictions of typical airline rewards cards. Any airline, any hotel, anytime. No blackout dates.
Chase Slate® Credit Card
16.49% to 25.24% variable
0% Intro APR for 15 months (with $0 for transfers in first 60 days. Then $5 or 5% balance transfer fee)
$0
Jumpstart your financial fitness! 60 day introductory balance transfer offer, save on interest, and get your free monthly credit score.
Venture® from Capital One®
14.49%, 20.49% or 24.49% variable
$0 annual fee for the first year ($95 thereafter)
Earn 50000 bonus miles once after spending $3,000 on purchases within the first 3 months from account opening.
HSBC Cash Rewards Mastercard® credit card
14.49%, 18.49%, or 24.49% variable
0% Intro APR for 15 months (with whichever is greater: $10 or 4% balance transfer fee)
$0
Earn unlimited 1.5% cash rewards on all purchases. See Rates and Fees
Apply now Read review

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Kyle Morgan

Kyle Morgan is a writer and editor for finder.com who has worked for the USA Today network and Relix magazine, among other publications. He can be found writing about everything from the latest car loan stats to tips on saving money when traveling overseas. He lives in Asbury Park, where he loves exploring new places and sipping on hoppy beer. Oh, and he doesn't discriminate against buffalo wings — grilled or fried are just fine.

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US Credit Card Offers

Important Information*
Deserve® Classic Card
Deserve® Classic Card

APR

24.49
variable

Annual fee

0 For the first year
More info
Luxury Card Mastercard® Gold Card™
Luxury Card Mastercard® Gold Card™

APR

16.49
variable

Annual fee

995 For the first year
More info
The First Access VISA® Credit Card
The First Access VISA® Credit Card

APR

29.99
variable

Annual fee

75 For the first year
More info
Indigo® Platinum Mastercard® Credit Card
Indigo® Platinum Mastercard® Credit Card

APR

23.9
variable

Annual fee

75 For the first year
More info
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