Five Risky Ways to Pay off Credit Card Debt

In the United States, the average household consumer debt is less than $16,000. North of the border in Canada, the average household consumer debt is more than $25,000. With these alarming rates, what can we do to tackle the problem?

Studies have shown that one of the most important retirement goals is to be debt-free. In order to achieve this, some individuals may take drastic measures to address their high levels of debt. There are ways to pay off credit card debt conservatively, but then there are steps to take that are dangerous and risky.

Here are risky ways to pay off credit card debt that should be avoided at all costs.


Credit card debt can become so astronomical that some people may choose to starve themselves for a few days to save some cash in order to pay at least the minimum payment. In Canada, there are ads from debt-consolidation organizations that, in jest, have a woman carrying shopping bags and say, “I just won’t eat for a week.” Not only is this unhealthy, this is the wrong way to pay off your credit card debt.

Fast payment

Sure, we like to get rid of our credit card debt as soon as possible. Unfortunately, if you make a modest amount of income and have other important responsibilities, such as rent, groceries and transportation, then using a large sum of your paycheck or chequing account to pay off your debt won’t make much sense.

Other credit cards

You may have received a phone call from a telemarketer from a credit card company urging you to transfer all of your debt from your other cards onto theirs for a low monthly interest rate. This is also a bad idea because the debt will pile on and what if you start using your previous credit cards again?

Emergency finances

An emergency fund is exactly that: an emergency fund. Never use your emergency fund to help pay off your credit card bills or anything else that does not classify as an emergency.

Borrowing from the future

Let’s face it.  It’s tempting at times to borrow from the future to pay for our meal now, including credit card debt.  But, unlike the government, humans tend to, at least try to anyway, be more fiscally responsible. Therefore, taking money from your short-term, long-term or retirement funds is a terrible, terrible idea. Similar to your emergency fund, never use your savings to pay off credit card debt.