How to Payoff Credit Cards Using Debt Stacking

If you are looking for a powerful way to quickly pay down credit card debt, look at a method called debt stacking. Simply choose a target credit card and apply substantially more than the minimum monthly payment until the card is paid off while paying only the minimum payments on all other credit cards. Then repeat this method paying off one card at a time. Debt stacking can save you hundreds of dollars in interest charges but only works if you continue to make minimum monthly payments on all your cards and refrain from adding any additional charges to existing credit cards.

Instructions

1

Determine a dollar amount you can afford to apply to your target card after meeting your monthly bills. Add up all your debts, including fixed costs such as mortgage and utility payments as well as the minimum monthly payments on all the credit cards and loan installment payments. Subtract this number from your monthly income. The dollar amount you have left can be applied to your target card.

2

Choose a target card. This is the account you will pay off first. Apply the extra dollar amount along with the required minimum monthly amount to the target card until it is paid off. For all remaining debts, pay the minimum amount you owe.

3

Select the next target account after the first is paid off. Apply the entire dollar amount you paid on the first target card, including its minimum monthly payment, in addition to the required minimum monthly payment to the new target account. Repeat monthly until the second target card is paid off.

4

Continue applying the debt stacking method until the last card is paid off. As each new debt is paid off, apply the amount you were paying to that debt to the next target account in your plan. Payment on the last debt is accelerated since you are applying all past total minimum monthly payments to this target account.

5

Resolve to stay out of debt. Select one credit card for use and pay off that balance every month. Charge minimal amounts once or twice a year on all other cards to keep accounts active.