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How to curb credit card debt now before interest rates rise again

With credit card debt balances climbing in the US, you may want to rethink your credit card strategy ahead of a possible recession.

That’s why credit card debt is up 13% since last year, and that debt will only get more expensive as more interest rate hikes are expected later this year. Here’s what you can do, as recommended by a certified financial planner on CNBC Make It:

1. Pay off your credit card debt now

“This should be a top priority regardless of where we are in the economic cycle, but it’s especially important during times of high inflation and a potential economic downturn,” says Kendall Claiborne, a certified financial planner at SoFi.

Because the outstanding amount increases with the increase in interest rate. In the past few months, credit card interest rates have only risen from 16% to 17.42%, but it could be closer to 19% by the end of the year, said Ted Rossman, senior industry analyst at

2. Call your credit card company and ask for a lower rate

An easy way to lower credit card costs is to call your credit card provider and ask for a lower interest rate. They may say no, but if you are a loyal client with an improving credit score, they may say yes.

To help your case, mention credit card offers if competing companies come up with lower interest rates than you’re paying on your existing card. You can ask them to waive your annual fee too.

3. Consider a credit card balance transfer

A balance transfer is when you transfer debt from one credit card account to another at a lower interest rate.

Credit card companies usually offer 0% interest for an introductory period of up to 21 months. This means lower payments, at least for a while. But even after the 0% introductory period ends, you will have to make regular payments.

Recently there have been offers as low as 0% for 21 months, but they can still be found. Note that you usually need a good or excellent credit score to qualify, and you may have to pay a balance transfer fee of around 3% – 5% of the total loan transferred.

4. Get a cash-back card if you don’t travel much

Rewards travel cards usually have good redemption rates, but they may not be worth it if you don’t plan to travel much in the next year. Plus, they usually come with an annual fee.

If you’re focused on making ends meet, a cash-back rewards card may be a better option. These cards don’t have many perks, but they usually offer 2% – 5% cash-back for spending on essential shopping categories like groceries or gas. These cards are a great way to cover some of the costs of inflation.

5. Audit your credit card spending subscription

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