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Paying off credit card debt as an older adult

Paying off credit card debt is important at any point in one’s life, but is particularly important as an older adult. Having a large amount of debt can limit your options at a time when you really need them. Accredited Financial Counsellor of Canada, Guirlene, explains to our reader Sally, the best way to manage her debt.

The question…


I guess getting older does not guarantee getting wiser. I’m retired at 64. To make ends meet I’ve been using my credit cards. I have three, all of which are maxed out. Combined, I have $17,500 in credit card debt. At my age, how do I get out of this mess?

Sally C., Medicine Hat, AB

The answer…

I’m sorry to hear about your situation. It’s never too late to make positive changes. Getting out of debt takes time and dedication, but with persistence, you can achieve your goal. Celebrate small victories along the way to stay motivated. Surround yourself with supportive friends and family members who can encourage you on your journey to becoming debt-free. Stay positive and protect your mental health!

Here are some steps you can take to get out of credit card debt:

Assess Your Finances and Debt

The first step is to understand your financial situation. Start by creating a detailed budget that lists all your income sources, including retirement benefits, savings, and any other sources of income. Next, list all your expenses, including housing, utilities, groceries, transportation, insurance, and any other regular expenses. Finally, list your debts, including the balances, minimum payments on your credit cards and APR (annual percentage rate) for each credit card.

Prioritize repayment with the avalanche method

With a clear picture of your finances, you can prioritize paying off credit card debt. While making minimum payments on all your cards, focus all extra funds on paying off the card with the highest interest rate first. Once that card is paid off move on to the card with the next highest rate. This is known as the avalanche method and can save you money on interest over time.

Reduce expenses

Look for ways to reduce your expenses. This could include trimming dining, entertainment, and other non-essential spending. Consider downsizing your living arrangements or finding ways to reduce your utility bills. Look for cheaper alternatives for necessary expenses, such as shopping for groceries at discount stores or using public transportation instead of driving. Apply found savings towards your highest interest debt.

Increase income

Consider ways to increase your income to accelerate your debt repayment. This could include taking on part-time work, freelancing, or selling items you no longer need. You could also consider renting out a room in your home or using your hobby to generate extra income. Also apply these found savings to your credit card with the highest interest rate.

Evaluate debt consolidation options

Investigate debt consolidation loans or lines of credit that allow you to combine multiple debts into a single, more manageable payment with a potentially lower interest rate. This can simplify your repayment process and save you money on interest. Speak to your financial institution first. If this is not an option, you can speak to a reputable not-for-profit credit counselling agency about some debt management options.

Get professional help

If you’re struggling to make ends meet, consider seeking financial assistance. There are programs available that offer financial counselling and assistance for individuals struggling with debt. Nonprofit credit counselling agencies can provide guidance and help you develop a personalized plan to repay your debt and provide you with the support you need to stay on track.

Avoid accumulating more debt

Once you start making progress on paying off your credit card debt, it’s important to avoid accumulating more debt. Try to pay for things with cash or debit to prevent further debt accumulation. If you must use your credit cards, use them sparingly and only for essential purchases. Regularly check your credit score and strive to maintain a good credit score by responsibly managing your debt. Keep your credit utilization ratio (the percentage of your available credit that you’re using) below 30% to avoid negatively impacting your score.

Consider a reverse mortgage or home equity loan

If you own your home, you may be able to take out a reverse mortgage to access some of your home equity. This can provide you with a lump sum or monthly payment that you can use to pay off your debt. However, it’s important to carefully consider the risks and costs associated with a reverse mortgage before deciding if it’s right for you. You can also discuss a home equity line of credit or loan with your financial institution.

Other ways to find extra money

  • Review your insurance policies to see if there are any savings you can make. For example, you may be able to save money by bundling your home and auto insurance or by increasing your deductibles.
  • Many businesses offer discounts to older adults. Look for ways to take advantage of these discounts to reduce your expenses.
  • There are government assistance programs available to help older adults with low incomes. These programs can help you pay for necessities like food, housing, and healthcare freeing up more of your income to put toward paying off your debt.

In conclusion, getting out of credit card debt at 64 is challenging but achievable with careful planning and determination. By assessing your finances, cutting expenses, increasing income and seeking reputable, professional and individualized advice, you can take control of your financial future and enjoy a debt-free retirement.


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