9 hours ago
Credit card debt relief dos and don'ts to know right now
With the right approach, credit card users can start erasing what they owe as early as this card debt balances may have declined in the first quarter of 2025, but they're still a major source of financial concern for millions of Americans. At a total of $1.18 trillion in the first quarter of 2025, balances declined from where they were at the end of 2024, but they're still up 6% from where they were a year earlier. And with an average credit card interest rate of over 21% now and compounding interest making it difficult to pay down even seemingly manageable balances, it's easy to see why this is such a hardship for many Americans in today's economy.
Fortunately, there are multiple credit card debt relief options and programs available that are worth exploring right now. Whether you're considering credit card debt forgiveness, a debt management program, or something else entirely, however, there are some important steps to take during the process, especially in today's economic landscape. And there are some potentially costly missteps worth avoiding, as well. To improve your chances of success, it helps to know some important credit card debt relief dos and don'ts in today's economy. Below, we'll detail four of them.
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Credit card debt relief dos and don'ts to know right now
Here are four important dos and don'ts borrowers should know about credit card debt relief right now:
Do: Be proactive in reducing your debt
No matter which credit card debt relief option you feel is most applicable to you, it's important to be proactive. With credit card interest rates just under a record high and interest compounding daily for many borrowers, being aggressive is critical now and could be the difference between regaining your financial freedom and being mired in high-rate debt for the long term. Your current credit card debt balance was built up over time and it will likely take even longer to cut it back down, so start the process sooner rather than later.
Explore your credit card debt relief options online today.
Don't: Wait for rate cuts to impact what you owe
Waiting for interest rates to be cut by the Federal Reserve, to then reduce your already high credit card interest rates, isn't beneficial now. For starters, no one knows for sure when the central bank will cut rates (possibly in July, but that could change). Additionally, that cut is likely to be by just 25 basis points, which will have a negligible impact on your credit card rates (if at all). And, in the interim, your debt will just compound each day that it's not dealt with. So don't wait for a one-size-fits-all solution courtesy of Fed rate cuts, and instead look to be aggressive in cutting down what you owe now.
Do: Understand the impact of debt relief solutions
All debt relief solutions aren't created equally. Some will require more work than others. And, some will have a bigger impact on your credit score than others, especially those in which you'll stop making payments to your credit card company and then shift those payments to a debt relief service that will make them for you. The final result will still be the same – freedom from credit card debt and improved credit – but the methods of getting there will vary. So take the time to understand the impact (or low impact), as each potential solution has to better determine which applies to your current situation.
Don't: Assume automatic eligibility
Qualifying for credit card debt forgiveness isn't the same thing as qualifying for a debt management program and it's not the same as having the credentials for credit card debt consolidation, even if all three are similar. Each option comes with different criteria, some of which may be more flexible and appropriate for your situation than others. So don't just assume automatic eligibility. Instead, research what will be needed for each. This will not only allow you to better align with the right solution for your needs but it will also allow you to focus on gathering documentation that you'll inevitably be asked for, speeding up the process as a result.
The bottom line
For many borrowers, this June is a smart time to start the credit card debt relief process. With rates here near a record high, the reality of compounding interest making it difficult to pay down what you've borrowed and the likelihood of Fed rate cuts small (and minimally impactful on what you already owe), it makes sense to take action now. With a strategic approach incorporating the four above dos and don'ts, you can start cutting your balances and, more importantly, regain your financial health once again.
