I Paid Off $7,700 of Credit Card Debt in a Month. Here's What I Learned

For many years, I was consistent with paying off my credit card balance every month, but over the past two years, I hadn't been as disciplined as I was before. That led to my balance ticking higher until it reached about $7,700, which is only slightly less than the $7,932 the average American had at the end of 2023.

I was slowly paying down the balance each month, but I wasn't making as much progress as I had wanted. Then, I got a request from a freelance client I hadn't worked with in over 10 years, asking me to work on a significant writing project.

It was enough additional work to pay off my credit card balance and add some extra cash to my savings account. Thankfully, I can be flexible with some of my other writing projects and was able to complete all the assignments in the one-month window they gave me.

Since I paid off the debt, I've been thinking of what I learned and what I would do differently next time. Here are a few thoughts.

1. Say yes to extra work when it comes

I've been working as a freelance writer for a long time, so taking on side projects is pretty normal for me. I kept up with some other projects I had going at the same time, which made for about four weeks of long hours, but saying yes to the extra work was an easy decision.

While everyone has a different dollar figure for what's worth their time, it's important to evaluate opportunities when they come. Had I said no to this gig, I would have missed out on a big opportunity to improve my personal finances.

Many Americans have gotten used to the idea of working on side gigs, with 45% having a side hustle and about one-fifth of them earn $1,000 or more a month.

With so many people earning additional income from side projects, some Americans may have extra money to put toward their credit card debt, too. If you're looking to pay down your debt faster, consider signing up for an account on a gig platform to find extra work.

2. Put savings toward debt

If I could change a few things, I would have put more money from my savings account toward my debt earlier. Most experts recommend having at least $1,000 in emergency savings to cover unexpected expenses. I could have left plenty in my account and still paid down some of the debt.

The average credit card interest rate is over 20% now, making paying off large balances difficult, and Americans spend an average of $363 toward paying down their credit card debt every month. If I put the average $363 amount toward my card each month, with a 20% interest rate, it would have taken me 26 months to pay off, and I would have spent $1,880 in interest.

Using a credit card payoff calculator to see how long it will take to pay off your credit card and how much you'll need to spend every month can be a great tool for creating a debt payoff plan. If I had used a calculator and a debt payoff app earlier, I would have realized I needed to take some money from savings and put it toward paying down the balance earlier.

3. Rethink credit card usage

Over the past year or so, I switched from using my credit card regularly to using my debit card almost exclusively. That change kept me from accumulating even more debt, and it's one I plan to keep.

My credit card has cash back rewards, which is useful, but I'm willing to give up some of the rewards to keep my balance low. I'm going to return to my old habit of paying off the entire credit card balance each month and keeping the balance down.

One other change I could have made was to apply for a balance transfer card. Many of these cards have an introductory 0% APR, which could have given me a year or more of zero interest. That would have saved me some high interest payments and probably shortened my payoff time.

You don't need to do it all in one month

You don't have to tackle your credit card debt in a short period. Putting any extra money, even $50, toward your credit card payment every month is an excellent first step.

For example, if you have $7,700 in credit card debt and put $413 per month to the payment ($50 plus the average $363 payment), you'll pay off your debt three months faster and spend $282 less in interest than if you stuck with the $363 payment.

It's also a good idea to contact your credit card company and ask for a lower interest rate. At least half of the people who do so get their rate reduced, and if the company says no, you can then consider a balance transfer card.

Finally, consider using a debt repayment strategy, like the debt snowball method. This strategy prioritizes paying off smaller debt amounts first to help keep you motivated. Having a plan in place will keep you on track and allow you to track your progress.

I know firsthand how frustrating credit card debt can be. And while not everyone's payoff strategy will be the same, finding additional work and throwing any extra money you make at the balance will go a long way toward your payoff goal.