How to get out of credit card debt: a 7-step plan

By El Dinero Claro team · Updated October 26, 2026 · 8 min read

Credit card debt is one of the most expensive kinds of debt there is. Card interest rates are usually far higher than those on a personal loan or a mortgage, and the minimum payment system is designed to keep you in debt for a long time. The good news: with a clear plan, you can get out. Here are the seven steps.

1. Stop using the card

You can't empty a bathtub with the tap running. While you pay off the debt, leave the card at home and remove it from online stores and your phone's wallet. Use only debit or cash. This step is uncomfortable, but without it nothing else works.

2. List all your debts

Make a table with, for each card or debt:

• Balance owed.
• Annual interest rate (shown on your statement as APR or annual rate, depending on the country).
• Minimum monthly payment.
• Statement closing date and payment due date.

Seeing the total can be scary, but you can't make a plan without knowing it.

3. Understand the minimum payment trap

When you pay only the minimum, most of that money goes to interest and barely reduces what you owe. That's why some people spend years paying off a card whose balance hardly moves. Basic rule: always pay at least the minimum on every card, to avoid fees and damage to your credit history, and as much as you can above that on one of them.

Always pay before the due date, too. A late payment usually means a fee and, on some cards, a higher interest rate.

4. Free up money in your budget

Every extra unit of money you put toward the debt saves you interest. Make a monthly budget and look for temporary cuts: subscriptions, eating out, small daily expenses. If you follow the 50/30/20 rule, while you carry expensive debt you can move part of the 30% for wants into the 20% for debt repayment.

Before you go all in, try to have a small emergency cushion. Without one, the first surprise goes straight back on the card. A few weeks of expenses is enough to start; later you'll complete your emergency fund.

5. Choose a payoff method

If you have several debts, you need to decide where the extra money goes. There are two classic methods:

• Avalanche: highest interest rate first. It's the option that costs you the least money.
• Snowball: smallest balance first. You get quick wins that keep you motivated.

We explain both in detail, with an example, in debt snowball vs. avalanche.

6. Negotiate or lower the interest

You have several options, depending on what lenders in your country offer:

• Call your bank and ask for a lower interest rate or a payment plan, especially if you've been a good customer. It doesn't always work, but asking is free.
• Balance transfer to another card with low or 0% interest for a few months. Check the transfer fee and the rate once the promotion ends.
• Debt consolidation loan: a personal loan at a lower rate to pay off all your cards at once and keep a single fixed payment.

7. Don't fall back in

• Build your emergency fund so surprises don't end up on the card.
• If you use the card again, pay the full statement balance every month, not the minimum.
• Record every card purchase as if the money had already left your account.
• Look after your credit score: paying on time makes it go up.
• Celebrate the day you hit zero. The money that used to go to interest can now go to your savings.

This article is for information only and is not personalized financial advice. If your debts are hard to manage, look for help from a free, public or non-profit credit counseling service in your country.