How To Avoid Credit Card Interest And Lower Your Debt

By Aaron Sarentino Reviewed by Nima Vahdat Updated Nov 20, 2023
How To Avoid Credit Card Interest And Lower Your Debt

If you want to lower your debt, learning how to avoid credit card interest can reduce your monthly payments and help you pay off your balance faster. 

Credit card debt is expensive, and because you can keep spending on your card even when you owe a balance, your debt can grow quickly.

That’s why it is important to avoid credit card interest charges as much as you can now, and in the future. 


  • Credit card interest costs consumers thousands of dollars every year. 
  • If you can’t avoid credit card interest entirely, there are ways to lower it and still save money.
  • Understanding your interest rate and how it accrues can help you take control of your finances.

What is credit card interest and why should I avoid it? 

Credit card interest, also called APR, is the amount the card issuer charges for holding a balance. Many people think that having credit is the same as free money, but that couldn’t be further from the truth. 

For example, if your card has a limit of $1,000 and you spend $400, that amount becomes your balance. If you only pay $100, you retain a $300 balance, and the card company will charge you interest on that amount. 

Interest rates vary depending on multiple factors, including your credit score, payment history, and overall credit history. The higher the interest, the more money you pay, making it harder to pay down your balance and get out of debt. 

The more credit cards with a balance that you have, the more interest you pay. 

In fact, Americans are spending around $1,000 a year on interest charges alone, making it one of the most expensive passive expenditures in the country. 

While there are many reasons you may have a credit card, including covering emergency expenses, the best way to reduce your debt is to avoid paying interest completely. 

How to avoid credit card interest

While you may not be able to avoid using a credit card altogether, there are ways you can avoid paying interest on your purchases. 

Think strategically about large purchases

Credit cards are often used to cover large purchases like appliances and vacations. While an emergency like your air conditioner breaking down can happen unexpectedly, you can think strategically for planned purchases. 

Acquiring credit card debt doesn’t have to be your default option for financing large expenses; you can also try the methods below.

Utilize buy now, pay later offers

Buy now, pay later plans are becoming a popular option for both large and small purchases, with companies like Klarna, Afterpay, and Affirm. These companies let you split your purchase into smaller monthly or bi-weekly payments, either with or without interest. 

You may incur additional fees if you fail to make a payment, so be sure to read the loan terms prior to completing your purchase. 

Look for a low or no-interest credit card

Many credit cards offer a low or 0% APR introductory period when you open an account. Typically, the length of the deferred interest is between twelve and twenty-one months, giving you ample time to pay off your purchase interest-free. 

These low-interest cards are also a popular debt relief option, allowing you to transfer your balance from a high-interest card, lowering your monthly payments and helping you get out of debt sooner. 

Take advantage of deferred-interest financing

Many in-house financiers, like big box stores and medical facilities, will offer a deferred financing period. A similar concept to 0% APR introductory offers on credit cards, it provides a certain length of time to pay your purchase off without interest. 

However, if you fail to pay off the balance before the promotional period ends, you are not only responsible for the interest on the remaining balance but on the entire purchase price. For example, let’s say you purchase a couch for $2,000 with deferred interest financing for twelve months. 

Under the agreement, if you don’t pay off the balance at this time, you will begin paying an interest rate of 15% on the purchase. At the end of the year, you’ve only paid $1,000 of the original amount; you will now begin paying the accrued interest not only on the remaining balance but for the entire purchase price. 

To calculate that amount, you would divide 15% by 12 to find your monthly interest rate, which is approximately 1.25%. Then multiply it by the total balance to find the monthly interest charge, $2,000 x 0.0125 =$25 per month. 

You’ve already had the loan for 12 months, so you would multiply $25 by 12 to find that you now owe $300 in interest on top of the $1,000 you still have to pay for a new balance of $1,300. 

Taking into consideration that you must continue making monthly payments on that new amount, with the 15% interest rate, you can see how expensive deferred-interest loans can be if you fail to pay them off on time. 

How to reduce credit card interest

If avoiding credit card interest altogether isn’t an option, you can look for ways to lower the amount you pay. 

Start an avalanche – A debt avalanche, that is. One highly effective way to reduce the amount of interest you pay is by paying off your high-interest credit cards first. A debt avalanche is a technique where you list all of your debts, ordering them from the highest interest rate to the lowest and making a larger payment on the higher rate cards and minimum payments on those with lower rates. 

Once you pay off the first debt, move to the next, using the excess money from the first card towards the next until you’ve paid off all of your balances.

Make multiple payments – Your interest charges are based on the average daily card balance, so doubling up on your monthly payments reduces your daily balance and, in turn, your interest charges. 

Use your savings – If you have enough money stored for emergencies, you can use a portion of your savings to pay down your high-interest debt. Just be sure to keep enough set aside to cover unexpected expenses in the future.

Utilize a personal loan – Personal loans can aid in debt consolidation by allowing you to pay off your high-interest cards with a lower-interest loan. You will then have a singular monthly payment, making budgeting easier.

Final thoughts on how to avoid credit card interest

Knowing how to avoid credit card interest can help you save thousands of dollars and get on the road to financial stability. 

However, if interest charges keep piling up month after month, and your debt has become unmanageable, it’s important to know you have options.

At Americor, we understand the importance of managing your finances wisely. 

As America’s trusted source for debt relief solutions, we aim to empower you with financial knowledge that can lead to informed decisions, whether it’s about savings, investments, or managing debt.

If your debt has become unmanageable and you have difficulty making your debt payments each month, then you should consider a free consultation call with one of our certified Debt Consultants, who can provide personalized advice tailored to your specific needs.

By taking proactive steps today, you can put an end to your financial stress and work towards a brighter financial future. 

Remember, there is always hope for debt relief, and our team of experienced professionals are ready to guide you on your journey to regaining control of your finances.

For more information on Americor’s debt relief services, contact us today to see how we can help you eliminate your debts, and get on the fast-track to becoming completely debt-free!


Aaron Sarentino

Aaron oversees executive, administrative and management functions for the firm. Aaron has a Bachelors in Business Administration from Pepperdine University. He is responsible for helping customers at every stage of the debt settlement process and focused on building loyalty to ensure long-term client retention by addressing customer issues. Aaron plays a pivotal role in the upliftment of the Americor team to ensure the best possible customer experience for clients.