A credit card is a valuable financial tool only if you use it to your advantage. It can help you earn rewards and assist you in times of emergency financial needs. Credit card debts are expensive as interests are compounded daily; you may have to shell out as much as 175% interest on your bills. If you do not clear debts on time, the interests can spike to 29% on unpaid balances.

You can repay the debt in time. Let’s find out how.

Always pay your due on time
Late payment attracts hefty penalties. Never miss a payment. Set up an auto-debit, mark your calendar, and ensure that your linked bank account has enough balance to pay for the credit card dues. This will help you

Pay more than your monthly dues
Since credit card interest is compounded daily, your unpaid due increases daily. Apart from paying the monthly auto-debited payments, you can pay an additional amount when you receive your salary or if you have some spare cash. A reduced credit card increases your credit score, which can be crucial if you want a mortgage or a student loan.

Buy a balance transfer credit card
Balance transfer credit card is best suited for those with high credit scores. These cards usually have a promotional offer of 0% APR for 12 months or more. You can pay more on your monthly installments, reduce the debt, and improve your credit score with no interest. Also, choose cards with no or nominal balance transfer credit card charges.

Follow popular debt repayment strategies

• Debt avalanche
  List your credit card debts, settle the card with the highest debt, and move on to the cards with lower debts. Continue paying the minimum monthly amount on the rest of your credit card dues.
• Debt snowball
  This is ideal for people with lesser disposable cash at their hands. Under this strategy, you can settle the lowest credit card debt first and move on to the next higher debt card. This keeps you motivated towards clearing your debts.
• Debt lasso method
  It combines strategies where you pay off the cards with the lowest debts. You then consolidate the rest of the debt into one monthly payment at low-interest rates.
• Debt volcano method
  It is unconventional but can help you find peace reduce financial stress from mounting debts. Under this method, you settle the debt that bothers you too much or the one that you hate. Settling the most bothersome debt can help you stay motivated towards settling the others quickly.

Control your spending
Though it may take time and a lot of effort, controlling your impulse to shop randomly can be the biggest step towards settling debts. It prevents further debt accumulation and ensures that you still have some cash for emergencies. You can control spending by reading books or being part of groups or communities that help each other control shopping impulses.

Take a personal loan
If your credit card loan is too much and you do not have a good credit score, borrow from friends or family or apply for a personal loan and settle all your credit card loans at one shot. You now only have to pay one monthly amount for your personal loan instead of paying off multiple credit cards.

Take professional help
Many designated independent and non-profit credit counseling agencies help with settling debts. They will analyze your current and credit card debts, other obligations like mortgage, your income. They will work out a realistic and sustainable repayment plan with these numbers. Make sure you check their credibility before making any commitments.

Make a budget
Making a budget and spending with limits needs personal financial discipline and commitment. Like the effort you take to control using your credit card, it may take time, but it is one of the most definitive and long-term strategies that can help you reduce your credit card debts.