Credit cards seem like the best thing in the world when we first get them, they offer the ability to buy now and pay later with ease right? But then we spend a bit more, then a bit more and we find ourselves with this cycle of paying money off the credit card and then maxing out that same credit card within a few weeks – or even days. So how do we break the cycle of credit card debt?

Dear Credit Card,

I thought I loved you when you first came into my life but now you’re causing me too much stress and I just don’t know what to do.

Is that how your letter would start to your credit card?

Don’t panic you’re not the only one, I was there too.

The biggest thing you need to know is that you’re not a bad person for having credit card debt. You didn’t set out to have this happen it’s just crept up. Bank’s work hard and helping this happen after all, that’s how they make their money from it.

And the other thing you need to know it’s never too late to get it sorted.


So, let’s jump into my 5 tips to Avoid the Chaos of Credit Card Debt.


1. Cut it up!

Now if you’re thinking I’m not doing that…hear me out.

Why are you going to keep something that is continuing to stress you out and putting pressure on you financially?

You can’t just get rid of your credit card, I understand that, but cutting it up so you can no longer use it and then paying it off will stop that stress. Trust me!

Maybe you think it’s good to keep it because you get reward points…but what are those reward points actually costing you? And when you calculate the return on your spending, they aren’t worth the stress of staying in your current credit card debt cycle.

Pretty much every bank and financial institution now gives you a visa debit card that’s attached to your savings account that allows you to make purchases the same as if it was a credit card. But the best bit is that the money is straight from your savings, not from your future income. So if you limit the money in that account you can’t spend what you don’t have…right?

Cutting up your credit cards also means that you can actually pay off the debt once and for all.If you’re anything like I was, I would pay money off my credit card and in the next week I would have spent money using that credit card again…I was never actually getting ahead.

Word of warning* about balance transfers, there are normally hidden fees and charges more information can be found about that here.

2. Get to know EVERY fact about your credit card.

Such as:

  • What is exactly owing.
  • What date are your payments are due on each month.
  • What interest rate you’re being charged.
  • If you have an interest-free period, when does it expire?
  • How long it will take to pay off paying the amount you’ve chosen.
  • How long it will take to pay off vs a higher amount.

A great calculator to calculate how long your debt might take to pay off is available here ( Information is power! So use this to compare with other companies and then use this as a tool with your financial institution to ring and get them to try and match…they want to keep your business remember! Do this even if you’ve cut up your card, you still need to know everything about your debt.

3. Money Mindset

Why are you constantly getting yourself stressed out with money? Why are feeling like you’re in this financial vortex that you can’t seem to get out of?

It’s because you’ve got yourself in that mindset, and it can feel overwhelming when things feel out of control. But with a change in mindset, you can realise you’re totally in control.

There is SOOOO much to know about Money Mindset so I’ll keep this brief. When I work with my clients to go through their Money Mindset I look at these items: Money Beliefs, Setting Correct Intentions, No Money vs Yes Money, and what I want to discuss now with you which is Needs vs Wants.

A lot of the research I’ve done, we often forget the difference between what we actually Need, and just purely acting on our wants.

So, as simple as it sounds, go back to just buying what you actually NEED for a bit and you’ll be saving money in no time. Set an easy period of time, such as one paycheque period, and see how your “want vs need” muscles get stronger and stronger!

4. Create Goals

We all have life goals right?
I have video footage of my teenage self saying I want to be a millionaire, I had no basis for how I was going to get there, I just knew that’s what I wanted to be. I’m not there yet but I do have goals in place now to get there. I have my ultimate end goal and from that I’ve worked backwards and basically laid out the road map to get there.

It doesn’t mean I have to stick exactly to the road map, and there may be some detours, but having the ultimate end goal helps me to stay on track. It helps me to stop spending money on things I don’t need. It helps me to continue to pay down my debt. It helps me to make decisions about what I truly want in my life.

So, create one major goal you want to achieve and then write down all the steps as to how you’re going to get there.

5. Build a Budget to know about ALL of your money.

A budget will get you out of credit card chaos.

Do you know right now where you’re spending your money exactly? Or if you’re like me, do you get towards pay day and you’ve run out of money but you have no idea where you spent it?

Well when you first do a budget it should show you where you have been spending your money. It’s a good way to reset your assumptions about where and how much you spend. Use your figures from the last 6 months to see what’s cost you the most. Is it rent/mortgage, is it eating out, is it shopping…whatever it is you can start to make a plan to get things back on track.

A budget is just income minus expenses ideally with some left over. If you’re in the minus you will need to make some adjustments in your spending, or increase your income. Often it’s more realistic to change your spending patterns than asking your boss for a raise!

A budget gives you the power to make decisions about whether you can allocate money to extra repayments to your credit card, or you can know where to change your spending habits.

I hope this has helped you to get in control of your credit card and gets you out of the chaos you’re feeling.


Sally Bellamy is a Money and Budget Coach who works with those who seem to be stuck in the cycle of never having QUITE enough money and are struggling to get their spending under control, and who instead want to rapidly reduce their debt and create a savings plan that allows them to say YES to what they want more often.

Getting your money sorted doesn’t mean you need to resort to 2min noodles for dinner or stress over every dollar spent. It’s about creating a plan so that you DON’T have to count every penny anymore. And it can be SO much easier (and more fun) than you might think.
Let Sally show you how!