5 Simple Credit Card Debt Solutions

You have a huge amount of credit card debt, and you have no idea how you’re going to pay it off. In fact, the amount you owe is so overwhelming that you’ve been avoiding the issue altogether.

If this sounds like you, don’t feel bad. You’re not alone in your stress. In fact, the average Australian has a credit card balance of $3,130.

If left unchecked, credit card debt can spiral out of control. Follow these credit card debt solutions to secure your financial future.

And are they stressed about this debt? You bet.

In fact, in a study printed in the Journal of Family and Economic issues, researchers found that there’s actually a link between credit card debt and depression levels.

Credit card debt shouldn’t be ruining your life. But, stressing out about your debt isn’t going to do you any good.

Instead, you need to be proactive and work on implementing debt solutions to get rid of it.

Let’s take a look at the top credit card debt solutions. You’ll be surprised at how simple they are.

1. Figure Out What You Owe and Set a Budget

The best debt solutions begin with figuring out what you owe.

This will help you set a budget and develop a plan of attack.

To figure out what you owe in an organized fashion, create a spreadsheet. This spreadsheet should contain the dirty details about all of your credit cards: the total balance, the minimum monthly payments, the interest rates, and the due dates.

Once you’ve got all this information compiled, you can set your budget.

Ideally, you’ll want to create a budget that allows you to pay a little more than the monthly minimums due.

Now, we realize that your budget may already be pretty tight. Is it really possible to tighten it even further?

Most likely, yes.

Take a hard look at your spending habits over the past few months. Make note of all the money you spent on luxury items versus on necessities.

Subtract your luxury spending from your total spending and allow this to be your budget until your credit card debts are paid off.

2. Choose a Repayment Strategy

There are a few different strategies for paying back your debts. Each has its benefits but ultimately you’ll want to choose the one that will actually motivate you to repay.

Let’s take a look at what these strategies are:

Highest Interest Rate First

Paying off the highest interest rate card first definitely makes the most sense financially.

This strategy will save you the most money overall as it will limit the total compound interest on your debt.

Once the balance on one card is paid off, you move on to paying off the one with the next highest interest rate.

But, don’t think that paying one less minimum payment per month is an invitation to spend more money. Instead, you should use the money you’d normally put towards your minimum payment towards the next card. Keep repeating this until you’re done paying your last card.

If this is the strategy you decide to go with, just remember that you’ll still need to make minimum monthly payments on all your other cards.

Pay Off the Lowest Balance

Also known as the snowball strategy, paying off the card with the lowest balance is great for those who love a quick win.

Often times, a quick achievement is all you need to keep pushing towards your loftier repayment goals.

Compared to other debt solutions though, this one will not save you the most money in the long-run. However, it can give you some time to save money for your cards with the most debt.

Consolidate Your Cards

Are all the numbers and figures in your spreadsheet just giving you one big headache?

If you’re someone who struggles to keep track of payments, consolidating your debts may be the best debt solutions option for you.

This repayment strategy helps you focus on one large number instead of multiple smaller ones.

For those who can live without those “quick wins,” this is a great solution. However, you should still try to pay more than the monthly minimum to ensure you stay on track.

You may also want to consider consolidating your debt and then making a balance transfer to another card with an interest-free period.

Many cards offer interest-free periods as long as 24 months. But, make sure you don’t use this time to ignore your debts. Instead, use it to repay as much as possible before that interest kicks in.

3. Stop Swiping

Sometimes, you need to stop the bleeding completely.

In other words, you need to stop swiping your credit cards and stick to using only cash or debit cards.

To make this easier, you should leave your credit cards at home when you go out. Hide them in a drawer or have a trusted friend or family member hold on to them for you.

You can even cut them up and wait to order new ones until your debts are repaid.

Whatever you do, don’t close the credit card accounts completely. The length a card is opened for can affect your credit score. Closing the card will only negatively affect your score.

4. Grow Your Income

Picking up side gigs can be a great way to pay down your debts fast.

If you work a job that offers more hours, start putting in that overtime.

Or, you could run a side hustle in addition to your full-time job. Here are a few ideas:

  • Sell stuff on eBay or Etsy
  • Pick up freelance gigs – writing, graphic designing, editing, virtual assisting, etc.
  • Get a second job on nights and weekends
  • Drive for Uber or Lyft
  • Pick up random gigs on Craigslist

5. Auto Payments

You know paying back your credit card debt is a necessary evil, but you just can’t seem to stay on top of it.

The best way to make credit card payments a priority is to set up auto payments for each statement cycle. This will allow you to make your monthly minimum payments before engaging in any unnecessary spending.

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Debt Solutions: Wrap Up

Implementing these debt solutions will help you repay your credit cards fast.

And while paying off your credit card debts is a huge accomplishment, often times it’s not the end of your financial woes.

Many people with poor credit card spending habits have poor credit scores and struggle to qualify for loans because of it. If your bad credit is holding you back after repaying your loans, take a look at how our bad credit loans can help you.

Disclaimer: Please be aware that Cigno Loans’ articles do not replace advice from an accountant or financial advisor. All information provided is intended to be used as a guide only, as it does not take into account your personal financial situation or needs. If you require assistance, it is recommended that you consult a licensed financial or tax advisor.


Ordered by the Federal Court of Australia

The Federal Court of Australia has found that Cigno Australia Pty Ltd (Cigno Australia) and BSF Solutions Pty Ltd (BSF Solutions) have breached the law by engaging in unlicensed credit activity and charging prohibited fees.

In the period from July 2022 to 3 October 2023, over 100,000 consumers have been lent a total of $34 million, and charged fees of over $70 million, under the ‘No Upfront Charge Loan Model’ operated by BSF Solutions and Cigno Australia. At no time has either BSF Solutions or Cigno Australia held an Australian Credit Licence.

The Court also found that Mark Swanepoel (director of Cigno Australia) and Brenton James Harrison (director of BSF Solutions) were involved in these breaches of the law.

With effect from 24 May 2024, the Court has granted permanent injunctions preventing Cigno Australia and BSF Solutions from:

  • demanding, receiving or accepting fees or charges, including amounts of loan principal, from consumers in relation to credit provided under the ‘No Upfront Charge Model’; and
  • engaging in further credit activity pursuant to the ‘No Upfront Charge Loan Model’, including by entering into new agreements with consumers, for so long as they do not hold an Australian Credit Licence.

Cigno Australia was ordered by the Court to, by 5th July 2024, send written communications to consumers who between July 2022 and December 2022 entered into agreements with Cigno Australia and BSF Solutions under the ‘No Upfront Charge Loan Model’.

The Court will later determine whether (among other things) Cigno Australia and Mark Swanepoel ought to pay a pecuniary penalty in respect of this conduct, and whether Mark Swanepoel should be restrained from carrying on a business engaging in credit activity.

Cigno Australia, BSF Solutions, Mr Swanepoel and Mr Harrison intend to appeal the decision of the Court and have filed an application for leave to appeal. If the appeal is successful, some or all of the orders of the Federal Court of Australia may be set aside.

Where can you get more information?

Where to go for further support

You can access legal advice in your state at: Free legal advice – Moneysmart.gov.au.

If you are experiencing trouble with debt, or money worries in general, contact:

  • the National Debt Helpline on 1800 007 007 or online chat (9:30am to 4.30pm, Monday to Friday).

If you need someone to talk to, contact:

  • Lifeline on 13 11 14 (24 hours) or their crisis support online chat or
  • Beyond Blue on 1300 22 46 36 (24 hours) or their webchat