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FIRE: How to get out of CREDIT CARD DEBT before you start chasing FIRE

Your best strategy to get out of credit card debt.

Credit card debt is a freedom killer.

Unless you are paying off your entire balance each month, the credit card company is frankly fucking you out of your chance at retirement.

Rates on credit card debt can go up to 36%.

That means on a $1,000 in debt, you are paying $360/year in interest AND still have to pay back the original $1,000.

Considering the stock market would be lucky to return 7% each year and savings accounts (even Froogal Club Savings) only returns 1.26%, this is absurd.

They know this but unless you were trained to look out for this type of exploitation you probably do not.

So now you do.

Being in credit card debt is not the end of the world.

But it will stop you from ever getting to FI/RE.

So what is our best strategy to use for ourselves or tell our not-so-FIRE friends about if they need it?

So, obviously, we need to pay off the outstanding balance. No matter how daunting.

It's not going away and will only grow compounded (that shit works both ways).

So here's the immediate battle plan:

  1. Figure out how much money you have leftover each month to pay in excess of your current minimum payment

This is pretty simple. Take your monthly salary (after-tax) and subtract out housing, living, and other debt payments.

If your number is above $0. You're in good shape.

If it's below zero, we need to make some serious changes.

Below zero means that you are going to keep going deeper and deeper into debt each month until you eventually have to declare bankruptcy and lose all your shit.

Not ideal. You will either need to increase your income (second job or pay raise) or drastically reduce your expenses (get a cheaper apartment, cut down on grocery costs, refinance some of your other debt).

This is a crucial step 1 - and leads into step 2.

2. Adjust your financial system

It may not be your fault, but you need to change how your financial life operates in order to avoid this happening again.

That means figuring out where your money is going, reducing expenses, and creating an emergency fund to cover the unexpected expenses that you may have put on your card.

If you do not fix the system, this shit is going to keep happening.

Discussions with your spouse about your spending/savings habits are crucial. If both partners are not on board, you don't stand a chance.

3. Zero-interest balance transfer

This sounds worse than it actually is.

When used strategically (clear planning for paying off the debt load), this can allow you to save hundreds in interest payments while you are implementing your plan (thus making killing the debt even easier).

You will need to select one of the current zero-interest balance transfer cards here:


Once selected, approved, and obtained - you will need to work with the credit card vendor to transfer over your existing debt.

This 0% interest on your transferred balance is TIME-LIMITED.

That means it goes away after 12-18 months (which is when the new credit card company starts to fuck you out of your early retirement).

This is why you need a clear plan to kill this debt within the 12-18 months.

With your new strategy, figure out EXACTLY how much you need to pay in excess of the minimum payment each month to pay off the credit card debt over the 18 month time period.

Then compare this number to how much you will now start earning/saving when you reduce your expenses or get a second job.


If not, you need to revisit the planning part of this and figure out a new strategy.

Your last option, which I'm keeping off the official list, is Bankruptcy (Chapter 7 or 13).

I'll publish another article on how that works but here's your best initial resource:


Dave also dispels here the myths common with bankruptcy:

Happy saving.

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