How can I clear my £5,000 credit card bill without paying too much interest?

In our weekly series, readers can email any questions about their finances to be answered by our expert, Rosie Hooper. Rosie is a chartered financial planner at Quilter Cheviot and has worked in financial services for 25 years. If you have a question for her, email us at money@inews.co.uk. Question: My credit card bill is £5,000, I can’t afford to pay that off in one go, what is the best way for me to do this? My compound annual rate – which includes both standard fees and interest – is 33.2 per cent and my simple monthly rate is 2.42 per cent. Answer: First things first, try not to panic. A £5,000 credit card balance can feel overwhelming, particularly when you’re looking at an interest rate of 33.2 per cent. But you should also be proud that you are acknowledging the situation and making a plan to tackle it, which is the hardest step for many people. Shorts The uncomfortable reality is that 33.2 per cent is a very expensive rate of borrowing. At that level, interest quickly starts working against you. The longer the debt sits there, the more of your monthly payment disappears towards interest rather than reducing what you owe. That’s why I would strongly suggest avoiding the minimum payment trap. Credit card providers generally lower your minimum payment as the balance falls. While that can feel helpful in the short term, it often keeps borrowers in debt for years. Instead, set yourself a fixed monthly repayment amount and treat it like any other essential bill. To show the difference, if you kept the debt on your current card and paid it off over: 12 months, you would need to pay around £485 a month, with total interest of approximately £821 24 months, you would pay around £277 a month, but total interest would rise to roughly £1,650 36 months, payments fall to around £210 a month, but the interest bill swells to almost £2,547. In other words, stretching the debt over three years would cost you more than three times as much in interest as clearing it within a year. Before committing to any repayment plan, it’s worth checking whether you could qualify for a 0 per cent balance transfer credit card. These cards allow you to move existing debt and pay no interest for a promotional period, often between 12 and 24 months, although there is usually a transfer fee to factor in. If you can secure a competitive 0 per cent deal and resist adding any new spending to the card, every pound you repay goes towards clearing the balance rather than servicing interest. For many people, that is the fastest route out of expensive credit card debt. Whatever route you choose, give yourself a clear end date. People are far more likely to stick to a financial goal when they can see the finish line. Work out what you can realistically afford each month, mark a debt-free date in your diary and keep track of your progress. It can also help to tell someone you trust about your plan. Whether it’s a partner, friend or family member, having someone who can check in and keep you accountable can make a surprising difference when motivation starts to dip. And when you finally make that last payment, celebrate it. Not with another credit card splurge, obviously, but with something affordable that marks the achievement. Becoming debt-free after tackling a sizeable balance is no small feat. We don’t know what circumstances led to the debt in the first place, and life has a habit of throwing expensive surprises our way. What matters now is that you’re taking control of the situation. With a clear repayment target and the right strategy, there’s every reason to believe that £5,000 balance can become a thing of the past.