Tax season recently just wrapped up, and that means your personal finances have probably been at the center of your attention for the past couple of months. Now that you have some breathing room, it may be helpful to take a good look at your credit situation. Carrying credit card debt is never a good recipe for getting ahead financially, or for the health of your credit score. The interest charged on the credit card debt you carry will almost always outweigh the interest you could earn from investing cash that you could use to pay off those credit card balances. In addition, if you’re planning on making a big purchase such as a new home or automobile, then your credit score will need to be fairly strong if you want to secure a loan with a low interest rate. Once you’ve paid off that debt and are well on your way to a healthy credit score, make sure you compare credit cards to find the best credit card for your credit score and financial situation. Here are four rules to keep in mind if you’re struggling to pay off that pesky credit card debt:

  1. Pay the minimum payment every month. Ensuring that you make the minimum payment required on your credit card debt each month is paramount when it comes to protecting your credit score, and dragging yourself out of debt. If you fail to make the minimum payment on your credit card balance, you risk your credit score taking a hit, as well as potential financial penalties from your credit card company such as a higher interest rate and penalty fees. Usually, the minimum payment is a small fraction of your actual balance, so it’s definitely manageable to pay it off each month.
  2. Get rid of high-interest balances first. It should make sense that the credit card balances that carry the highest interest rates should be paid down before credit card balances that charge little to no interest (like a card with a long 0% introductory APR period). Failure to pay off your high-interest credit card debt is the easiest way to find yourself falling deeper and deeper into an endless pit of debt. Only once you’ve paid down those high-interest balances should you begin to pay off your balances that carry lower interest rates. If you’re really struggling to pay off that high-interest balance, then pay close attention to the next point.
  3. Consolidate your debt with a balance transfer. Balance transfers aren’t for everyone, but if you have a solid credit score and sizeable debt on a high-interest credit card, it may be in your best interest to transfer that balance to a credit card that offers a long 0% introductory APR period on balance transfers. By transferring your high-interest balance to credit card geared towards balance transfers, you can buy yourself up to 18 months in which you are not required to pay any interest on your balance. Credit cards such as the Slate from Chase Card and the Citi Simplicity Card offer long 0% interest periods on balance transfers, and are great options for people looking to consolidate their debt.
  4. Pay off your credit card debt before putting away cash. While it’s definitely prudent to have a small stockpile of cash on hand for emergencies (typically between $500 and $1000), you’re going to want to make sure you pay off your credit card debt before trying to significantly save or invest any more money. As I mentioned in my introduction, the credit card debt you accrue will almost always charge a higher interest rate than any CD, savings account, or investment can earn you. Paying off your debt before saving also protects your credit score from going down the drain.