How This Blogger Killed His Credit Card Debt and Why He Did It

The following is a guest post from Josh Wilson. Josh is the owner of a start-up personal finance blog, Family Faith Finance. Feel free to check out his blog and learn more about his journey through life.

It’s no secret: Americans have more credit card debt than ever before. In fact, consumers in the United States owe a total of $747 billion in credit card debt. I was once one of the millions of Americans carrying a credit card balance; I had approximately $1,500 on my card shortly after college.

That may not seem like a lot to some people, but that debt was a heavy burden on my finances with student loan debt and just starting out in my career. It was important for me to address it right away and pave the way forward for my financial goals such as retirement and paying off student loans.

Expediting My Repayment

I paid off my credit card debt by taking two steps. First, I transferred my balance to a different card with a much lower APR by taking advantage of an introductory rate. The interest rate on my original credit card was extremely high, and it was making it incredibly difficult to make a dent in what I actually owed.

Once I made the transfer, I was able to start paying it off in earnest. I took on some additional jobs by picking up freelance IT work, even selling baked goods, and mowing lawns. That was step number two. All of my extra money went directly to paying off my credit cards. Before the introductory rate was up, I had paid off my credit card debt — and could then focus on my student loans.

The idea behind expediting credit card debt repayment was pretty simple: reduce my debt expenses and increase my income. On a sheet a paper, it’s just a simple addition-subtraction problem; both actions led to a more positive future and net worth.

Why I Chose to Kill Off Credit Card Debt

So why was it so important that I pay off my credit card? After all, I had student debt too. In light of my debts, I picked out credit card debt because I felt that it would have affected my ability to save for retirement the most. The reason lies in the interest rates on my debts and the potential return of starting retirement earlier.

Even though I had more student debt than credit debt, I prioritized my credit card debt over my student loan debt because the interest rate was higher. While it may not make sense, I knew I wasn’t paying off all my student debt anytime soon, so I had to settle on the monthly payment which was manageable. The monthly payment for my credit card debt was not going to be as manageable, and it would have risen considerably if it got sidelined.

As mentioned earlier, that decision was based entirely off the interest rate on my credit card in relation to my student debt. The monthly payments on my credit card would have gotten worse due to interest while the student loan payments were going to remain doable. I had a better chance at paying my credit card debt sooner while sticking to my budget.

When it comes to saving for retirement, time is your biggest advantage. Saving even a little bit each month can really add up in the long run. This is thanks to the wonder that is compounding interest. Unfortunately, that wonder also would have held me back if my credit card debt stuck around. Any contribution that I could have made towards growing my future net worth would have been devoted to combating my rising credit card debt. This would have left me in a vulnerable position down the road.

Summing it Up

When you have credit card debt, it can impact your ability to save for retirement in a significant way. Every dollar that you are putting towards your credit cards is a dollar that you cannot put towards your retirement. Instead of taking advantage of growing your wealth with interest, you’ll spend time combatting interest that is adding to your debt. If you pay off your credit cards sooner rather than later, then you can experience the positive side of interest sooner.

If you have debt of any kind, planning out your repayment is a big step. Come up with a game plan to pay it off; I started by first lowering your interest rate on my credit card debt. Retiring is typically much harder if you have debt holding you back!


Blogger-in-Chief here at RetirementSavvy and author of Sin City Greed, Cream City Hustle and RENDEZVOUS WITH RETIREMENT: A Guide to Getting Fiscally Fit.

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