How to Make a Budget to Pay Off Credit Cards

You've decided that it's time to cut the cord on your credit cards and finally pay off the debt that's been weighing you down. Paying off your credit cards is an accomplishment, especially if you've spent more than you should have and are now shouldering a heavy debt. You may need to adjust the way you live or find a way to make more money to pay off your credit cards quickly.

Lay out each of your credit card statements. Add the total amounts due on each card together so that you have a general sense of how much you owe. Record the balance of each card as well as its interest rate on the notepad.

Figure out how much money you make each month by looking at your pay stubs and those of your partner. Also, figure out your expenses by totaling your bills and receipts from the previous month. If you already have a budget, use that to make your debt payoff budget.

Set a goal for being credit card debt free. You should strive to pay more than the minimum due each month to pay the card off quickly and spend less money in the process. Look at your income and expenses and set an amount you are able to pay on the cards each month. You may want to use an online credit card calculator to help you see how long it will take to pay the debt based on the monthly payment you can afford and the interest rate.

Trim excess expenses if you need to so that you have the money to pay off your credit card debt. It'll be difficult to adjust your lifestyle, but the payoff — being debt-free — will be very much worth it. If you absolutely cannot trim expenses, think of ways to earn a bit more each month, such as getting a part-time job.

Divide the amount you want to pay each month into two and pay biweekly instead. When you make biweekly payments on your card instead of one payment a month, you end up spending less on interest since you make more payments per year, according to Elisabeth Leamy of ABC News. As an example, if you plan to pay $500 a month, make a half-payment every two weeks of $250 instead. You will end up paying $6,500 in a year, or $250 times 26 two-week payments, instead of $6,000 monthly, or $500 times 12 monthly payments.

Items you will need

  • Receipts and bills, especially your most recent credit card statements
  • Calculator
  • Notepad and pen
  • Pay stubs


  • As of February 2010, each of your credit card statements includes a box that will tell you how long it will take to pay off the card's balance if you only pay the minimum and how much you need to pay each month to pay the card in full within three years, according to the Federal Reserve.
  • Depending on the size of your credit card debt, you may want to tap into a savings account to pay off the debt. While interest on your cards may be 15 or 25 percent, interest on a savings account may be only 1 percent, so it may not make sense to hold on to that money while high interest accumulates on the cards.


  • Don't use your credit cards while you are paying them off. Pay for the things you need with cash or a debit card. If you have extra cash left over at the end of the month, use the extra money to pay even more of your debt.

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About the Author

Based in Pennsylvania, Emily Weller has been writing professionally since 2007, when she began writing theater reviews Off-Off Broadway productions. Since then, she has written for TheNest, ModernMom and Rhode Island Home and Design magazine, among others. Weller attended CUNY/Brooklyn college and Temple University.