How to get out of credit card debt in 2022

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If debt is dragging you down, here’s how to get those credit cards paid off.

Key points

  • Credit card debt can cost you money and also hurt your credit score.
  • Consolidating your balances, making lifestyle changes, and getting a scramble could be your ticket to closing out the new year debt-free.

Credit card debt can be a difficult thing to manage on many levels. First, there are those monthly payments – the ones that probably take up a scary chunk of your income. Plus, high levels of credit card debt could actually lead to a lower credit score, making it harder to borrow money when you need it.

If you start 2022 with credit card balances to pay off, three key actions on your part could be debt-free by the end of the year. Here’s how to get rid of that credit card debt and move on.

1. Make your balances cheaper to pay off

The problem with credit cards is that they tend to charge a lot of interest, so even a modest balance can get bigger over time as the interest increases. If you’re sitting on multiple expensive credit card balances, consolidating that debt might be a smart move.

One option to consider in this regard is a balance transfer. If you have a good enough credit rating, you may qualify for an offer that allows you to transfer your various balances to a single card with a lower interest rate or even an introductory rate of 0%.

Another avenue to explore is consolidating your credit card debt with a personal loan. If you’re able to get a loan with a lower interest rate than your credit cards charge, your debt will be cheaper to pay off.

2. Rework your budget to free up more money

You may have certain expenses in your budget that can be reduced. If so, reworking your budget could help you get rid of credit card debt faster.

Take a look at your various bills. It may be possible to spend a little less on food (for example, by swapping takeout for home-cooked meals), or reduce your transport costs by carpooling to work with a colleague who lives nearby . In fact, a series of small changes in your spending could free up enough cash to significantly reduce your credit card balance.

3. Increase your income with side work

To get ahead of your credit card debt, you may need extra money. Since you can’t count on winning the lottery, you can take steps to increase your income by getting a side hustle. Since this money won’t go toward regular bills, you can use all of it (minus what you owe in taxes) to reduce your credit card balances to $0.

Believe it or not, there are a number of lucrative side businesses you can take up without having to commit to a rigid schedule. If you own a car, for example, you can sign up to drive a ride-sharing service. And if you have a good eye for numbers, you can see if there’s any medical billing or data entry work you can do from home when you have free time in the evenings.

If you’re in credit card debt, you’re in good company, but that doesn’t mean you have to stay there. Follow these tips and hopefully you’ll manage to end 2022 with your credit cards fully paid off.

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