How to consolidate credit card debt

If you’ve got a lot of credit card debt to pay off, consolidating it into one place with one monthly repayment can make your life a lot easier.

Credit card debt can quickly become expensive, and if you’ve got debt on several different credit cards, managing each can get complicated. That’s why moving all your debt to one place can make good financial sense.

How to pay off credit card debt

If you have multiple credit cards with multiple balances and multiple lenders, keeping track of your various different payments can be a challenge. Having payments going out on different dates can make it harder to budget. Plus, if each credit card charges a different interest rate, some will cost you a lot more than others.

One way to help make your life a lot easier and potentially help you to pay off your credit card debt faster is to consolidate your debt.

How does credit card debt consolidation work?

Credit card debt consolidation is the process of combining all your credit card debts into one. One way to do this is by taking out a personal or consolidation loan and paying off your card providers with the money you’ve borrowed. You then repay your loan provider in monthly instalments.

Alternatively, you can consolidate card debt by using a balance transfer credit card to merge your debts onto one card. If you choose the right credit card, a balance transfer is often cheaper than a personal loan.

Why should you consolidate your debt?

Consolidating your credit card debt has many benefits. For a start, merging all your debts means you’ll only have one monthly repayment on one date rather than several payments on different dates. This can make it much easier to track what you owe and when. You’ll also only have one lender to deal with if you need to contact them.

Another benefit is that you may be able to take advantage of a lower interest rate, which has the potential to save you hundreds of pounds. If the loan or credit card you choose has a lower interest rate than what you’ve been paying, you can clear your debt faster.

Finder survey: How stressed do we feel about the thought of being in debt?

Somewhat stressed41.86%
Very stressed33.43%
Not very stressed15.79%
Not stressed at all8.91%
Source: Finder survey by Censuswide of Brits, December 2023

Using a balance transfer to consolidate debt

One of the most popular ways to consolidate credit card debt is to carry out a balance transfer. This is the process of moving debt from existing credit cards to a new one – ideally, one that offers a lower interest rate.

Some balance transfer credit cards charge no interest at all for a number of months – up to 3 years in the best cases. This should give you plenty of breathing space to start tackling your debt head-on without worrying about interest building up, and this should allow you to clear your debt more quickly.

Be aware that many balance transfer credit cards will charge a transfer fee of around 1% to 3%. But given how much interest you could save, this fee could be worth paying.

Also note that to fully benefit from a 0% balance transfer card, it is important that you clear your balance before the 0% deal ends and interest kicks in.

If you’re concerned about being able to clear your debt within that time, you could either transfer your debt again to another balance transfer card. Or you could take out a low APR balance transfer card that charges a low interest rate for the life of the debt. This means that while you will still pay interest on your debt, the rate is likely to be lower compared to the amount you were paying before, and there is no deadline by which you need to pay off your debt in full. Some low interest balance transfer cards don’t charge transfer fees either.

What are the pros and cons of balance transfers?


  • All your debt will be in one place
  • There’s only one monthly payment to make
  • You could save hundreds in interest
  • You could clear your debts faster
  • Your credit score could improve as a result


  • You may have to pay a balance transfer fee
  • The best balance transfer offers are reserved for those with a good credit rating
  • If your card has a 0% offer, the interest rate will jump once this has expired
  • You could hurt your credit score if you don’t manage your debt carefully

Are there any other ways to pay off credit card debt?

If you don’t want to or can’t use a balance transfer or personal loan to consolidate your debt, there are other methods you can use to help you clear your credit card debt.

As a first step, look at your bank statements and see where you could make cutbacks. This could enable you to free up extra funds to put towards your credit card debt.

Then, note how much interest is being charged on each credit card and find the one with the highest rate (as this will cost you the most). Next, put as much money as you can towards paying off this credit card while still keeping up with the minimum monthly repayments on your other cards.

Once you’ve paid off this credit card, focus on your next most expensive credit card, putting as much money as you can towards this debt while still paying the minimum on your other cards. Keep doing this until you’ve paid off all your credit cards. This method could help you to clear your debt more cheaply.

An alternative way to do this is to focus on the smallest debt first and put as much money as you can towards this. This won’t be as cost-effective, but you can pay off this debt faster, which can give you a sense of achievement and encourage you to keep going. You can then focus on the next smallest debt and so on.

Alternatives to credit card debt consolidation

If you’re struggling to repay your debt and you’re worried that it’s spiralling out of control, other options are available, but you need to consider them carefully.

  • A debt management plan (DMP) is an agreement between you and your creditors to pay off your debts. You can arrange a plan with your creditors yourself, through a licensed debt management company for a fee or through a debt charity like StepChange for free. Your DMP is designed to help you manage your debts and pay them off at a more affordable rate by making reduced monthly payments.
  • A debt relief order (DRO) is a way to have your debts written off, provided you have debts of less than £30,000, assets of less than £2,000, you do not have much spare income and you do not own your home. With a DRO, you won’t pay anything towards your debts for 12 months, and after this time, they are written off.
  • An individual voluntary arrangement (IVA) is a formal and legally binding agreement between you and your creditors to pay back your debts over a set time. IVAs can be flexible, but they can also be expensive.

If you’re considering any of the above options, always seek free debt advice first through organisations such as StepChange, National Debtline, Citizens Advice and PayPlan.

If you live in England and Wales, you can also get temporary protection from your creditors while you get debt advice and make a plan. This scheme is called Breathing Space and gives you protection for up to 60 days (longer if you’re getting mental health crisis treatment).

You’ll still need to make your debt repayments, but it means that enforcement action cannot be taken against you, your creditors cannot contact you about debts included in your Breathing Space and your creditors cannot add interest or charges to your debt.

Frequently asked questions

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Written by

Rachel Wait

Rachel Wait is a freelance journalist and has been writing about personal finance for more than a decade, covering everything from insurance to mortgages. She has written for a range of personal finance websites and national newspapers, including The Observer, The Mail on Sunday, The Sun and the Evening Standard. Rachel is a keen baker in her spare time. See full profile

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