Launching Your Credit Card Debt Payoff Plan

You have the data and a plan, now you only need the "go"

An illustration depicting people taking on a variety of personal finance tasks.

The Balance

Paying off credit card debt can seem overwhelming, but having a solid debt payoff plan gives you a step-by-step process to reach your goal of debt freedom. Now that you have a plan, make sure it's a success.

Put Your Plan Into Action

The work you’ve done up to this point will be critical for launching your credit card debt payoff plan. Having a list of debts, choosing a debt payoff strategy, and knowing the amount you can afford to pay toward your debts are all key steps to take before you can launch your plan.

You don’t need much to keep track of your progress; use The Balance’s Credit Card Debt Worksheet from earlier in the series and add new tabs for each new month (we’ve already added a few for you).

Stop Adding New Debt

While you’re working to pay off your credit cards, it’s important not to take on any new debt. That includes applying for new loans or making purchases on your existing credit cards. Otherwise, you’ll undo the progress you’re making, since adding new debt will increase your payoff time and your total debt costs.

Sticking to a budget can help ensure you don’t have to turn to your credit cards to make ends meet.

The 50-30-20 and envelope budgeting methods can help you live within your means and avoid using your credit cards. With the 50-30-20 budgeting strategy, the goal is to spend 50% of your income on needs, 30% on wants, and 20% on savings.

In the envelope budgeting method, you identify how much you want to spend in different categories, like gas or groceries, and separate your cash into envelopes for each category. When an envelope is empty, you can’t spend any more on that category, which helps you stick to your budget.

In addition to following a budget, having access to an emergency fund, even if it’s just $500, can save you from having to use a credit card for unexpected expenses.

Check to see if your credit card has a lock feature that locks it for new purchases. This tool can help curb impulse purchases, since you’d have to turn your card on again to use it.

Mark Your Progress

Tracking your progress along the way is key to staying motivated and ensuring you stick to your plan. Set small goals to remind yourself of the progress you’re making. For example, you may set a milestone at each 25% increment of debt payoff, or achieve a mini goal when you pay off each account. The intent is to celebrate along the way and avoid discouragement if it feels like it’s taking a long time to pay off all of your debt.

Next Steps and More Resources

Managing your finances is important as you pay off your debt. The stronger your financial habits, the more successful you’ll be, not just in paying off debt, but in reaching your other financial goals, too. In the next series, we’ll walk through the steps of how to make a budget, the foundation of your finances. But for now, here are a few resources to help you launch your credit card debt payoff plan and keep it going: