If debt has been lingering on your credit cards, and you have not been able to pay off debt fast, you are not alone. Half of American credit card users are carrying credit card debt, according to an August 2024 Bankrate survey. Clearing out your credit cards before you enter the new year is possible with a clear plan for the rest of the 2024.
My husband and I crushed $300,000 in debt in just three years—but we faced setbacks, frustration, and moments when giving up felt easier. What kept us moving forward was breaking our big debt payoff goal into smaller, actionable challenges.
If you’re ready to jump-start your journey to debt freedom during the holiday season, here are three strategies to make it happen.
1. Declutter for Dollars To Pay Off Debt Faster
You don’t have to wait until January to pair financial progress with a fresh start at home and in your budget. Starting in December, declutter daily by donating or tossing items equal to the day of the month. For example, one item on the 1st, two on the 2nd and continuing through the end of the month.
For every item, pay $1 toward your credit card debt. By the end of 31 days, you’ll have contributed $496 toward your financial freedom while lightening your living space by 496 items, too. Decluttering also serves as a great reminder to spend more intentionally going forward as you get rid of items that you spent money on, but no longer serve you or your financial goals well.
2. Pay Off Debt Fast With A 7-Day Spending Break
I love doing this challenge during the week between Christmas and New Years, when work is slower and the pressure of holiday gifts has come and gone.
For seven days, commit to only buying necessities and track any “wants” you skip along the way. Even more potent is putting the credit card away in a drawer or in a block of ice for the week. Yes, I said a block of ice — it’s both effective and thematic for this time of the year.
At the end of the week, revisit your list. Take the money you saved and put it directly toward your debt. For example, if the your “almost purchases” added up to $150, make a payment of that amount toward your credit card balance instead. You’ll likely find many impulse desires have faded.
Think of it as a detox for your spending habits. This practice not only clears up your finances but also strengthens your alignment between your values and your pocket—helping you spend with greater intention on your credit cards moving forward.
3. Pay Off Debt Fast With A $1,000 Credit Card Challenge
If you’re motivated to clear some serious space on your credit card limit, start by tackling $1,000 of credit card debt in the next 30 days. With average credit card interest rate hovering around 23%, eliminating even this amount can save significant money long-term.
For many, $1,000 can feel overwhelming, so break it down further: $250 per week or just $33 per day. You’ll be amazed at how achievable it feels when you:
- Return holiday gifts that don’t fit your style;
- Cut small expenses like takeout or streaming services temporarily;
- Sell unused items, like clothes or furniture to second hand shops or on Facebook;
- Negotiate with credit card companies for lower interest rates; or
- Shop for better insurance rates for your car, home and pets.
This challenge isn’t just about the numbers; it’s about proving to yourself that you can move the needle on your finances by taking fast action and making smaller choices that compound over time.
The Bottom Line
Tackling credit card debt doesn’t have to feel insurmountable. Breaking your goal into smaller, creative challenges makes it manageable and even enjoyable, if you decide to pay off debt fast. These methods employed as a last sprint for the year helped me stay consistent and achieve debt freedom—and they can help you, too. Finish 2024 strong so that you can make 2025 your breakthrough financial year.