Easy Ways to Repay a Huge Credit Card Bill

Did you know that by March 2024, banks in India had issued over 101 million credit cards? This data from the Reserve Bank of India (RBI) highlights how millions of people enjoy the spending flexibility that credit cards provide. Whether you need to manage daily expenses, handle an emergency expense, capitalise on a sale, or earn reward points, credit cards offer you the financial freedom you need.

There may be times when your credit card bill might be higher than you expected. Perhaps you needed to make a big-ticket purchase, finance a last-minute trip, put down a payment on a new car, or handle an unplanned expense. No matter the cause, the priority now is to settle the balance promptly and maintain your financial well-being.

Here are some useful strategies to help you repay a huge credit card bill efficiently and get your finances back on track.

Convert payment to EMIs

Most credit card issuers offer the flexibility to convert payments into Equated Monthly Instalments (EMIs) either at the point of sale or from your online account management portal. This way, you can divide the hefty bill amount into manageable monthly instalments. The fixed monthly payments simplify budgeting, as you know exactly how much you need to pay each month.

Before proceeding, it’s advisable to compare the total cost of paying in full versus in EMIs to make sure this option is financially beneficial.

Make more than the minimum payment

When you only pay the minimum, most of your payment goes towards interest, with little impact on the principal balance. This means it could take years to pay off your debt, and you might end up paying a significant amount in interest.

By paying more, you directly reduce the principal, which lowers the amount of interest charged in the following months. This accelerates debt repayment and saves you money on interest.

Pay off high-interest debt first (avalanche method)

The avalanche method, also known as the "stacking method" or the "debt ladder," prioritises paying off debt that carries the highest interest rate. You continue making minimum payments on other loans. Once the debt with the highest interest is cleared, you then shift your attention to the one with the next highest rate.

By prioritising the most expensive debt first, you reduce the amount of interest accruing over time, which saves money and speeds up the overall repayment process.

Clear the smallest balance first (snowball method)

In this debt repayment strategy, you start by paying off the smallest debt first while keeping up with the minimum payments on larger loans. Once the smallest debt is settled, you apply its payment to the next smallest debt. This process continues until all debt is paid off.

The major benefit of the snowball method is psychological. By closing smaller loans quickly, you get a sense of accomplishment, which can keep you motivated to continue paying off your debt. This structured method is especially effective for people who need motivation to stay committed to paying off huge credit card bills.

Consolidate debt with a personal loan

Instead of handling multiple credit card bill payments with varying high interest rates, you can take out a single personal loan to pay off all your outstanding balances. This smart approach allows you to consolidate all your credit card debt into one EMI at a lower interest rate than credit cards.

Also, with a fixed repayment schedule, it becomes easier to monitor your progress and stay committed to your financial obligations.

Smart use of windfalls

Using unexpected windfalls can help you tackle the repayment of a substantial credit card bill. These windfalls could include:

• Tax refunds

• Salary bonuses

• Festive bonuses

• Cash gifts

Use these extra funds to pay off your credit card debt instead of buying non-essential items. This strategy can reduce the interest you accumulate and also shorten the repayment period without having you sacrifice your day-to-day spending.

Control future spending to avoid a debt trap

You should also consider opting for a credit card that offers benefits that make future spending affordable through attractive discounts and reward points. This will ensure that you don’t end up with another huge credit card bill that you cannot comfortably pay off.

You can choose the IndusInd Bank Platinum RuPay Credit Card for this purpose, as it comes with various reward points and a competitive interest rate.

Also, the IndusInd Bank Platinum RuPay Credit Card is UPI-enabled. For every ₹100 spent on UPI transactions, you earn 2 reward points, while non-UPI transactions earn you 1 reward point per ₹100 spent. You can choose from various redemption options, including:

• Gift vouchers on IndusMoments

• Airline miles on InterMiles

• Airline miles on Vistara

• Cash credit

• Pay with rewards

Furthermore, the 1% fuel surcharge waiver at any petrol pump across India means you save even more on routine costs.

Look at the additional perks you get with this RuPay credit card:

• You can apply for the credit card online quickly and easily, with no physical paperwork and bank visits required

• Zero joining/annual fees

• Enjoy travel insurance coverage for lost baggage, passport loss, ticket loss, and missed flights

• ‘Total Protect’ keeps you safe from unauthorised transactions or counterfeit fraud. You are protected for an amount equal to your card's credit limit.

• All fees and charges are clearly outlined in the credit card agreement, which means no surprise costs in the future

Click on this “RuPay credit card apply” option and get started with IndusInd Bank today. The online process is convenient for both existing customers and new applicants.

Key takeaways

Repaying a huge credit card bill is difficult, but manageable with the right strategies and discipline.

Convert your large payments into EMIs to spread out your financial obligations. Pay more than the minimum required to reduce your principal faster. Adopt the avalanche or snowball method to tackle huge credit card bills strategically. Consolidate multiple credit card bills with a personal loan to simplify your payments. Smartly direct any windfall to your outstanding debt.

Each of these strategies can help you get closer to becoming debt-free and strengthen your financial health.

Additionally, to avoid finding yourself in the same situation again in the future, a highly practical solution is to opt for a credit card with a competitive interest rate that allows you to earn reward points on daily spending, such as the IndusInd Bank Platinum RuPay Credit Card. Click on the credit card apply online option today to get started.

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