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5 Easy Tips To Help You Pay Off Your Credit Card Debt

Credit card debt is quite possibly the worst kind of debt that you can carry

Credit card debt: thee words no one likes to utter.

And it’s not even a good type of debt. At least with a mortgage, there’s light at the end of the tunnel. When you make your last repayment, you own a home. Credit card debt is filthy.

Only loan sharks charge higher rates of interest - just - and it’s all too easy to spend what you’ve paid off the card in the previous month. Many of us have credit card debt, and many of us carry this debt like the proverbial ball and chain. It can weigh you down. Take the bolt cutters to the ball and chain and free yourself from the weight of credit card debt.

Here’s five tips to help you on the way:

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Make a commitment

Frugal is the new black.

First things first, make a commitment to paying off your card(s). This will mean a few sacrifices and becoming the embodiment of frugal. Tighten the belt. It may mean a few months of saying no to a night out, or dinner plans, but in the end you won’t be burdened by always having a credit card debt hanging over your head - in the end, it’s worth it.

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Consider a balance transfer

Why should you give your bank your hard earned money?

Once you’ve made a commitment to paying down the balance of your card(s), it’s time to organise your finances. A budget will come soon, but before you budget consider a balance transfer. A balance transfer is a great way to cut down the extra cash you have to fork out each month in interest repayments. There are some great offers out there at the moment, so take advantage of them. This will mean opening up a new credit card with a new bank, but there’s no loyalty in banking anymore, right?

To give you an idea of the type of cash a balance transfer can save you, if you’re currently getting charged 20% on a $5,000 balance, transferring this debt over to a card with a 0% for 12 months balance transfer promotional offer will save you approximately $800. This is money you would have had to pay to the bank in interest. Not bad, aye?

You can compare balance transfer credit cards in the table below.

Rates last updated November 24th, 2017
Name Product Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee Product Description
St.George Vertigo Platinum - Online Offer
12.74% p.a.
0% p.a. for 24 months
$0 p.a. annual fee for the first year ($99 p.a. thereafter)
Platinum card benefits plus 0% p.a. for 24 months on balance transfers (with no BT fee) and $0 annual fee in the first year. Ends 13 December 2017.
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
20.74% p.a.
0% p.a. for 18 months
$129 p.a.
Earn 3 bonus Velocity Points per $1 for the first 3 months, a first year annual fee refund and a yearly $129 Virgin Australia Gift Voucher.
NAB Premium Card
19.74% p.a.
0% p.a. for 20 months with 2% balance transfer fee
$90 p.a.
Benefit from premium perks including travel insurance, Platinum Concierge Service plus 0% p.a. for 20 months on balance transfers.
Citi Platinum Credit Card - 100k Bonus Points
20.99% p.a.
0% p.a. for 15 months with 1% balance transfer fee
$49 p.a. annual fee for the first year ($149 p.a. thereafter)
Earn 100,000 reward Points, take advantage of a long-term balance transfer offer and receive complimentary travel insurance.
ANZ Platinum Credit Card - Exclusive Offer
0% p.a. for 3 months (reverts to 19.74% p.a.)
0% p.a. for 12 months
$0 p.a. annual fee for the first year ($87 p.a. thereafter)
Exclusive to finder, receive 0% p.a. interest on purchases for 3 months and 0% p.a. on balance transfers for 12 months with no balance transfer fee.
HSBC Platinum Credit Card
19.99% p.a.
0% p.a. for 22 months with 2% balance transfer fee
$129 p.a.
Earn 1 Reward Point per $1 of eligible spend and receive complimentary travel and purchase protection insurances.
Bankwest Breeze Classic Mastercard
0% p.a. for 13 months (reverts to 12.99% p.a.)
0% p.a. for 13 months with 2% balance transfer fee
$79 p.a.
Receive 0% interest offers on purchases & balance transfers, up to 55 days interest-free on purchases and free emergency card replacement.
St.George Vertigo Visa - Online Offer
13.24% p.a.
0% p.a. for 18 months
$0 p.a. annual fee for the first year ($55 p.a. thereafter)
Take advantage of 0% p.a. for 18 months on balance transfers (with no BT fee). Plus, $0 annual fee in the first year. Ends 13 December 2017.
Westpac Low Rate Card - Online Only Balance Transfer Offer
13.49% p.a.
0% p.a. for 24 months with 2% balance transfer fee
$59 p.a.
Take advantage of 0% p.a. for 24 months on balance transfers with a 2% balance transfer fee when you apply online by 31 January 2018.
NAB Low Fee Card
19.74% p.a.
0% p.a. for 16 months with 2% balance transfer fee
$30 p.a.
Receive complimentary purchase protection insurance, special offers from Visa Entertainment and up to 44 days interest-free on purchases.
Virgin Money Low Rate Credit Card
11.99% p.a.
0% p.a. for 14 months
$49 p.a.
Receive a discounted annual fee, $100 cashback when you meet the spend requirement and up to 44 days interest-free on purchases.
NAB Low Rate Platinum Card
0% p.a. for 9 months (reverts to 13.99% p.a.)
4.99% p.a. for 6 months
$100 p.a.
A platinum card that offers 0% p.a. for 9 months on purchases. Plus 4.99% p.a. on balance transfers for 6 months.
Citi Rewards Platinum Credit Card
20.99% p.a.
0% p.a. for 24 months with 1.5% balance transfer fee
$49 p.a. annual fee for the first year ($149 p.a. thereafter)
Offers a long-term balance transfer. Earn extra points on eligible international spend, plus complimentary travel insurance.
Woolworths Everyday Platinum Credit Card
19.99% p.a.
0% p.a. for 14 months
$0 p.a. annual fee for the first year ($49 p.a. thereafter)
Receive a $50 eGift Card when you apply by 31 January 2018 and make an eligible purchase by 28 February 2018.
Bankwest Breeze Platinum Mastercard
0% p.a. for 13 months (reverts to 12.99% p.a.)
0% p.a. for 13 months with 2% balance transfer fee
$99 p.a.
Receive complimentary international travel insurance, extended warranty cover and 0% foreign transaction fees.
American Express Essential Credit Card
14.99% p.a.
0% p.a. for 12 months with 3% balance transfer fee
$0 p.a.
Get Smartphone Screen Insurance of up to $500 when you pay for your phone or contract with your Essential Credit Card.
American Express Explorer Credit Card
20.74% p.a.
0% p.a. for 12 months with 1% balance transfer fee
$395 p.a.
Receive a $400 Travel Credit every year and up to two entries per year to the American Express Lounge at Sydney International Airport.
Virgin Australia Velocity Flyer Card - Bonus Points Offer
20.74% p.a.
0% p.a. for 18 months
$64 p.a. annual fee for the first year ($129 p.a. thereafter)
Earn up to 60,000 bonus Velocity Points in the first 3 months on eligible spend and enjoy a discounted annual fee of $64 for the first year.
Qantas Premier Platinum
19.99% p.a.
0% p.a. for 15 months
$149 p.a. annual fee for the first year ($299 p.a. thereafter)
Fly further with 75,000 bonus Qantas points, up to 2 Qantas Points per $1 spent and 2 yearly complimentary Qantas Club lounge invitations.
Australian Military Bank Low Rate Visa Credit Card
10.99% p.a.
0% p.a. for 12 months
$49 p.a.
Enjoy up to 55 interest-free days on purchases, add an additional cardholder for $0 and enjoy the convenience of Visa payWave.
McGrath Pink Visa
4.99% p.a. for 8 months (reverts to 8.99% p.a.)
4.99% p.a. for 8 months
$40 p.a.
A basic, no-frills credit card with up to 55 days interest-free that donates half of the card's annual fee to the McGrath Foundation.

Compare up to 4 providers

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Come up with a budget

Plan, save, repay, repeat

Once you have an idea of how much your credit card repayments are going to be each month, it’s time to come up with a budget.

While you’re in ‘credit card debt reduction mode’, your discretionary income should be mainly used to pay down the balance of your card(s). That’s not to say you shouldn’t keep a few dollars aside (after you pay your bills and buy the necessities) for yourself, but remember what we said about becoming the embodiment of frugal? Any spare cash you have on hand should go towards your cards. The more you pay off your credit card(s) now, the less you will have to pay later.

Remember the saying, ‘a stitch in time saves nine’?

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Empty your savings

Say sayonara to your ‘rainy day’ savings

Following on from the last point, apply all your extra cash to the cards. This includes any money you have in savings accounts.

Rule of thumb: you will pay more on credit card interest repayments than the return you get from any savings account in the market. So it’s logical to move the cash from your savings and dump it on your card.

It might be a good idea to leave a little in your savings account for an emergency, you don’t want to have to use the card(s) again if you can help it. But be prepared to say sayonara to the cash you had sitting around for a ‘rainy day’ or a holiday.

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Pay the bills off one at a time

Start high then go low

This tip applies to people who have more than one credit card with a balance on it. It’s safe to assume that there’s a few people in this situation out there. To attack your credit card debt, pay the balance which attracts the highest rate of interest first, this balance will cost you the most in interest repayments - makes sense, right?

While you’re working at paying this balance down, make the minimum repayments on the other balances. When you’ve paid down the first debt, then move onto the balance which attracts the next highest rate of interest and so on.

Back to top

Following these simple tips can help you get out of your financial rut in almost no time. Just remember to stick to your budget and your commitment to being debt free.

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Qantas Premier Platinum
Qantas Premier Platinum

Interest rate

19.99

Annual fee

299
St.George Vertigo Platinum - Online Offer
St.George Vertigo Platinum - Online Offer

Interest rate

12.74

Annual fee

99
Bankwest Breeze Classic Mastercard
Bankwest Breeze Classic Mastercard

Interest rate

12.99

Annual fee

79

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