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Credit card debt can go from zero to thousands with one quick swipe. Or it can build slowly like rising water — a nice dinner here, some retail therapy there. Before you know it, your balance is uncomfortably high. You’re not alone. Almost half of American households carry credit card debt. Of those consumers, the average balance is $6,501, according to recent Experian® data.

If you’ve vowed to pay off your credit card balance, you’re making a smart financial move. Doing so can save you money on interest, build your credit history, and help you achieve other financial goals. Here, learn the top tips and strategies for getting it done, from the snowball strategy to hardship plans to the boring but effective debt-focused budget.

What Is a Realistic Payoff Schedule?

If you’ve been carrying a balance on one or more cards, it may take longer than you’d like to pay off the debt. Determine how long you need to become debt-free while still covering your monthly bills comfortably. 

You’ll want to consider these facts:

•   A longer payoff term can allow you to continue to save and invest while paying down debt. 

•   A shorter payoff term can save you a considerable amount in interest.

Worth noting before moving on to tactics: If there’s no scenario in which you can cover your living expenses and pay off your credit card debt in five years, the standard payoff strategies may not be enough. It may be time to consider applying for credit card debt forgiveness.

7 Credit Card Payoff Strategies and Tips

There are numerous ways to tackle debt and pay off credit cards. The approaches below may work best when you mix and match several to create your own custom debt payoff plan.

1. Create a Debt-Focused Budget

Achieving financial goals usually starts with a budget. Making a budget is designed to help you discover extra cash you can put toward your credit card bill.

•   First, make a list of your monthly bills that reflect the “musts” of your life. Along with your rent or mortgage, phone, gas, food, and other required living expenses, include your credit card payment and other minimum debt expenditures. You can leave the amount blank for now. This is your “Needs” column.

•   Next, look at your “wants.” These are things that you can survive without — restaurant meals, new clothes, gym membership, travel — but that often make life better. Which items can you do without temporarily so you can put their cost toward your credit card bill? The idea is to trim spending so you can pay down your debt.

It’s OK if your budget isn’t the same from month to month — flexibility is good. While you’re at it, build the following into your budget:

•   Look ahead for unavoidable big purchases (that upcoming destination wedding) and occasional bills (annual home insurance premiums, for instance, or holiday gift shopping). 

•   Leave some wiggle room for unexpected expenses. You might need to dip into your emergency savings for this kind of cost, but it’s good to have a cushion in your budget (say, for a rent increase).

•   Recognize that your credit card payment may be lower some months to accommodate the fluctuating costs noted above. Just always pay at least the minimum payment.

Your new budget should prioritize your credit card payment on par with other bills and above nonessential treats. One way to make budgeting easier on yourself is to download a financial insights app, which pulls all of your financial information into one place.

2. Zero-Interest Credit Card

The frustrating thing about credit cards is how interest can take up more and more of your balance. Zero-interest credit cards, also known as 0% APR cards, allow card holders to make payments with no interest on transfers and purchases for a set period of time. The promotional period on a new credit card can usually last from 12 to 21 billing cycles, long enough to make a large dent in the card’s principal balance.

Consolidating your credit card debt on one zero interest card serves to simplify your monthly bills while also saving you money on interest payments. The key here, of course, is to avoid racking up even more credit card debt.

One drawback to these cards is that you often need a FICO® Score of 670 or above to qualify. And once the promo period expires, the interest rate can climb to 29% or higher. In an ideal world, you’ll want to achieve your payoff goal before the rate rises.

A credit card interest calculator can give you an idea of how much your current interest rate affects your total balance.

3. The Snowball, the Avalanche, and the Snowflake

The snowball and avalanche debt repayment strategies take slightly different approaches to paying down debt. Both involve maintaining the minimum payment on all but one card.

•   The debt snowball method focuses on the debt with the lowest balance first, regardless of interest rate, putting extra toward that payment each month until it’s paid off.

Then, that entire monthly payment is added to the next payment — on top of the minimum you were already paying. Rinse and repeat with the next card. It’s easy to see how this method can quickly get the snowball rolling.

•   The debt avalanche is based on the same philosophy but targets the highest-interest payment first. Getting out from under the highest debt can save a lot of money in the long run. Just like the snowball method, applying that entire payment to the next highest interest debt can lead to quick results.

•   The third snow-related strategy, the debt snowflake, emphasizes putting every extra scrap of cash toward debt repayment. If you have extra money to throw at your debt, even $20, that can still make a difference in your overall amount owed. So this method encourages you to chip away at debt with any small amounts available.

4. Make More Money

Sure, increasing your income is easier said than done. But if you have the time to spare, it can make paying down debt a whole lot easier. Here are the top ways that people can bring in more cash:

•   Start a side hustle (or monetize an existing hobby)

•   Get a part-time job (on top of your current job). Two shifts a week can help you bring in another $500 to $1,000 per month.

•   Sell your stuff. Reselling clothes, books, old electronics, and jewelry can help bring in cash.

•   Negotiate a raise. In some cases, labor shortages may give workers extra leverage to ask for more.

5. Negotiate with Your Credit Card Company

If your large credit card balance is the result of unemployment, medical bills (yours or a loved one’s), or another financial setback, inform your credit card company. You may be able to negotiate a lower interest rate, lower fees and penalties, or a fixed payment schedule.

Hardship plans have no direct effect on your credit rating. However, the credit card company may send a note to the credit bureaus informing them that you’re participating in the program. 

One point to be aware of: Your credit card issuer may also close or suspend your credit card while you’re paying off the balance. This can leave you without a means to pay for purchases and could also ding your credit score.

6. Change Your Spending Habits

Changing how you spend your money is key to paying down debt — and to avoid racking up more in the future. You can approach this in two ways: as a temporary measure while you pay off your cards or a permanent downsizing of your lifestyle.

•   The advantage of the temporary approach is that people are generally more willing to give things up when it’s for a limited time. For instance, can you suspend your gym membership during the warmer months when you can work out outdoors? Perhaps you can challenge yourself to cook at home for 30 days to save on restaurants. Or you might go without paid streaming services for six months.

String enough of those small sacrifices together to cover a year or two, and see how quickly you might be able to increase your credit card payments. That in turn can make your payoff term shrink.

•   Downsizing your lifestyle for the long term has its own appeal, even for people who aren’t paying down debt. Living below your means is key to accumulating wealth. How exactly you accomplish that isn’t important. For instance, you can frequent cheaper restaurants, reduce the number of times you go out each month, or merely avoid ordering alcohol and dessert. The bottom line is to save money, avoid debt, and enjoy the financial freedom that results.

7. Personal Loan

Similar to a zero-interest credit card, a personal loan is a form of debt consolidation. Personal loans tend to have lower interest rates than credit cards, saving you money. And if you’re carrying a balance on multiple credit cards, a personal loan can allow you to simplify your debt with one fixed monthly payment.

Personal loans can be a great option for people with good to excellent credit. That’s because your interest rate is determined largely by your credit score and history. You can typically borrow between $1,000 and $100,000, and use the money for just about any purpose, from paying off debt to funding travel or a home renovation.

You will usually find fixed-rate personal loans, though some variable-rate ones are available as well. Terms usually run from two to seven years for personal loans.

The Takeaway

Credit card debt can sneak up on you. If you’re carrying a balance on one or more cards, there are numerous ways to approach paying down your debt. You might start with a new budget that prioritizes your credit card payment along with your other monthly bills, and trim your spending accordingly. You could then combine a broad payoff strategy (the snowball, the avalanche) with other tips and tactics (zero-interest credit cards) to minimize your interest payments and shorten your payoff term. And remember: You’re not alone, and you can do this!

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

FAQ

How to pay off a huge credit card bill?

There are a variety of ways to pay off a large credit card bill. These include making (and sticking to) a budget, trying the debt avalanche or snowball method, applying for a zero-interest balance transfer card, or taking out a personal loan.

How to get rid of $30,000 credit card debt?

To pay off a $30,000 credit card debt, it’s wise to create a smart budget, look into cutting your expenses, develop a repayment plan, and see about consolidating your debt. If these don’t seem likely to lead to getting rid of your debt, you might talk to a certified credit counselor and/or consider a debt management plan.

What is the best tip to pay off credit cards?

The best tip for paying off credit card debt will depend on a variety of factors, such as how much debt you have vs. your available funds. For some people, the debt avalanche method of putting as much available cash toward the highest interest debt can be a smart move. For others, consolidating debt with a personal loan may be a good option.

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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SOPL-Q324-040

If you, like many people, cringe when it’s time to pay the check after dinner out with friends, there are solutions. It can get tedious and frustrating to try to figure out who had how many drinks, but dividing it evenly may not be fair to the person who just had an appetizer. Or you might find that there’s often one person (or more) who doesn’t have cash, making payment tricky. 

To avoid ending a fun evening by doing a lot of math or risking hurt feelings, try these strategies. Splitting the check can be easily wrangled with just a little advance planning.

6 Tips for Splitting the Bill With Friends

These tactics can help you split the bill and keep everyone happy. The next time you go out to dinner as a group, try one.

1. Pick a Place Where You Order at a Counter

You could go to a fast-casual restaurant that allows you to order at the counter on separate tabs and then enjoy your meal together at the table. If you’re on a tight budget and are trying to save money or you’ve had difficulty splitting checks with friends in the past, this allows you to avoid a sticky situation. Or you might have a local food hall where each guest can grab their own meal from a multitude of stalls and then dine together. 

As these styles of dining continue to grow in popularity, you and your friends can have your choice of cuisines — without blowing your budget or haggling over the bill.

2. Ask for Separate Checks — Before You Order

Having everyone in your party get their own separate check is another simple solution. The key is to ask your server for separate checks before you start ordering. That way, your server can track everyone’s order separately from the get-go. This can help you avoid the confusing chore of splitting the bill (“Who had the cappuccino?” etc.) after the meal has ended.

Still, be mindful of the extra work you’re asking your server to do. Some experts recommend limiting the number of separate checks you request to no more than four. Some restaurants may honor a request for more or less; you might ask and see.

Recommended: How to Manage Your Money: Tips to Do It Right

3. Have One Person Put the Bill on Credit

Another strategy for splitting the bill is to agree that one person will pay the bill with their credit card, and the rest of the group will reimburse them. This makes things easier for the server. Be sure to include the tax and tip in your calculations so that everyone pays their fair share.

Instead of cash, since most people don’t carry as much money around as they used to, you could use an app to transfer money from one friend to another. Or you can likely move funds from your checking account to the bill payer’s using tools your bank offers.

There can actually be perks to being the person who pays the bill. You might earn rewards when you charge the amount or you might qualify for other bonus offers. 

4. Use an App to Track Your Outings

There are a few apps, like Splitwise and Tab, that allow you to track and split purchases with friends. These bill-splitting apps divide the cost of the bill and assign each person what they owe. 

A number of these apps connect to payment platforms so that everyone can pay their share or transfer money to others in the group. If not, you might then designate one person to pay the bill, as described above, and then others pay them back.

In addition, many payment apps, including PayPal and Venmo, have bill splitting features that can help a group split a bill evenly or with custom amounts. And some apps allow a group to split a bill and pay their share from their bank account. 

Recommended: Guide to Mobile Wallets: What They Are and How They Work

5. Use Different Credit Cards to Pay

If you forgot to request separate checks at the start of the meal, you still have options for dividing the check. Confirm that the restaurant will take the number of credit cards you wish to pay with, then have everyone go through and tally up what they ordered.  Then ask for those amounts to be charged to the appropriate card card.

For instance, one person might say, “Can you please put $38 on this card?” and another would say, “Can you put the remaining $50 on mine?” Then you would each pay your bill, adding any tip you wish to leave.

Just be forewarned: Many restaurants will only want to split a bill two or three ways with this method. If there are eight of you out for the night, this is unlikely to be a good option. 

6. Split the Bill Evenly

Say there are three of you dining out and the bill comes to $120. You might not get into the details of which person had the two pricey mocktails vs. the others each having a single glass of wine. If each person just puts in $40 (plus tip), you’ve split the bill evenly and politely.

This concept works especially well when you’re ordering small plates, which are designed to be shared. After all, when you’re sharing all the food, even bill-splitting makes sense.

If there are certain dishes you’re not going to eat, you might want to speak up at the beginning of the meal and ask if it’s possible for you to get a separate check.

Recommended: 10 Personal Finance Basics

Splitting the Bill Etiquette

Here are a few tips to ensure that things stay polite when you split the bill.

Ask for a Separate Check ASAP

As noted above, if you’re watching your spending, mention upfront your interest in a separate check. You might tell your group that’s your plan or simply request a separate check from your server when they start taking the order. However you approach it, it can spare you bad feelings later or having your bank account take a major hit by getting stuck splitting a big bill evenly.

Don’t Splash Out if You’re Splitting the Bill Evenly

Be mindful of what you order if you are splitting the bill evenly. If everyone else is ordering $15 hamburgers and you order the $32 steak special, that’s not fair to others when the tab is divvied up. If you’ve got to have that steak, ask for separate checks, or else perhaps volunteer to pay the tip on the entire tab to compensate.

Share the Meal Appropriately

If you are splitting the bill evenly, keep an eye out to make sure everyone gets their share of the meal. For instance, just because the guacamole and chips were placed on the table next to one person, that doesn’t mean you can’t politely say, “Please pass that to our end of the table once you’ve had some.”

Try Not to Worry About Every Last Penny

Recognize that splitting bills can be less than precise. There’s a chance you may pay a couple of dollars more or less than the exact amount you owe. Sometimes, simplicity is the best path rather than getting into advanced math calculations which might yield a couple more dollars in your savings account but trigger bad feelings. It may be best not to contest amounts down to the last penny for the sake of preserving the good vibes.

The Takeaway

There are several ways to split a bill when dining out with friends. Some methods are to request separate checks, to eat at a restaurant where you order at a counter, or to have one person pay and then the others reimburse their share. These tactics can allow you to keep everything polite among your group while enjoying good food and good company. 

Consider opening a bank account that makes it easy to send money and split a bill. 

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

How do you politely split a bill?

How to split a bill politely can be accomplished in a variety of ways. You might request separate checks if your group is on the small side, or you might divide the bill evenly. Another option is for one person to pay the bill, and others pay them back. Or you could dine at a restaurant where you order at a counter or at a food hall. In these settings, each person can pay their own way and then eat with their group.

Is there a polite way to ask to split a bill?

A polite way to split the bill is to bring it up before you and the other diners begin ordering. That can simplify matters. You might say something like, “Before we order, does anyone have any ideas for splitting the bill?” or “I am just going to have an appetizer tonight, so I will ask for a separate check.”

How do you divide a bill?

There are usually two methods for dividing a bill. You can divide the bill evenly among all guests, so that each person pays the same amount, regardless of what they ordered. Or you can divide the bill so that each person only pays for their share, whether they ordered three courses or just had dessert. The latter, as you might guess, involves more math. As you decide on a method of splitting the bill, don’t forget to account for tax and tip.

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.