( NewsNation ) — More Americans are falling behind on their credit card bills, and U.S. consumers now owe a record $1.14 trillion in credit card debt, but there are strategies you can use to get out of a hole.

The average credit card balance has swelled to $6,329 — up 30% from 2021, according to TransUnion . As balances have grown, so have the number of people carrying debt.

A recent Bankrate survey found that half of credit card holders carry debt from month to month — the highest share since March 2020. And 36% of Americans have more credit card debt than emergency savings.

“Credit card balances are up 48% since the beginning of 2021 so that really speaks to increased spending, but also increased reliance on credit,” said Ted Rossman, Bankrate’s senior industry analyst.

Research suggests Americans are increasingly relying on credit cards to cover basic needs, with many families taking on debt to pay for their groceries. Now, more people are falling behind on their bills, and delinquencies are rising .

Because it’s not tied to a physical asset like a home or car, credit card debt is considered unsecured, which makes it riskier for lenders and one of the most expensive ways to borrow.

These days, the average credit card interest rate is 20.5%, and for some retail credit cards , it’s upwards of 36% — which is to say that consequences can compound quickly.

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“The biggest reason why people should prioritize paying down credit card debt is because it probably has the highest interest rate of any debt that they have, meaning that it can grow the fastest,” said Matt Schulz, LendingTree’s chief credit analyst.

It goes without saying that anyone struggling with debt should look at their spending habits and monthly budget, but here are four specific steps you can take, according to the experts NewsNation talked to.

1. Choose the right strategy for you
2. Ask for a lower interest rate
3. Consider a balance transfer credit card
4. Reach out to a credit counseling firm

1. Choose the right strategy for you: avalanche method or snowball method

There are two popular approaches to paying off debt: the avalanche method and the snowball method.

With the avalanche strategy, you prioritize paying off debt with the highest interest rate. Start by listing your debt from highest interest rate to lowest and then put as much money as possible toward the debt with the highest rate. Once that’s taken care of, move on to the debt with the next highest rate, and so on.

Mathematically, both experts agreed the avalanche method is the best way to pay as little interest as possible. But that doesn’t mean it’s the best strategy for everyone.

Some people benefit from seeing fast results, so the snowball method may be a better option. That approach is all about paying off the smallest balance first and building momentum.

“If you’re motivated by getting some small wins and some early victories that will keep you moving forward, then the snowball is great,” Schulz said.

The downside is that you could end up spending more on interest compared to the avalanche approach.

At the very least, be sure to make the minimum monthly payment to avoid late fees and keep your account in good standing.

2. Ask your card issuer for a lower interest rate

If you’re struggling to keep up with your credit card payments, it’s worth calling your card issuer and asking for a lower rate. Your chance of success is probably better than you think.

“About 80% of the time, if you ask for a lower interest rate, you get one,” Rossman said. “The big asterisk to that is: How low are they going to go?”

Card issuers are often willing to drop the interest rate a few points, but in many cases, that’s not enough to drastically lower your monthly payments, Rossman noted.

Either way, it’s worth notifying your lender if you’re falling behind because card issuers have hardship programs to help.

“That can include stuff like deferred payments, reduced minimum payments, waived fees, temporarily lowered APRs,” Schulz said. “But you’re not going to get that stuff unless you reach out and tell them your story.”

If the Federal Reserve cuts interest rates further, as it’s expected to , borrowers will likely have more negotiating power to lower their rates in the coming months.

3. Consider a balance transfer credit card

A balance transfer is a refinancing method that allows you to move debt from a high-interest credit card to a new card with a lower rate, often 0%.

You’ll typically have to pay a transfer fee, usually 3% to 5% of the total balance, but after that, you can pay down your debt without accruing more interest.

“A 0% balance transfer credit card is about the best weapon in your arsenal against credit card debt,” Schulz said.

Keep in mind: the 0% interest rate is generally temporary, which means to get the maximum benefit, you’ll want to tackle your outstanding debt quickly.

The length of the 0% promotional period varies from card to card, but some offers last as long as 21 months.

Rossman said the balance transfer is one of his favorite credit card debt tips: “The ability to avoid interest for close to two years is tremendously powerful.”

He broke down the math like this:

• A person making minimum payments on a $6,300 balance at a 20.5% interest rate would be in debt for 18 years and pay $9,400 in interest.
• By comparison, someone paying 0% interest for 21 months would be able to clear their $6,300 balance by paying $300 a month interest-free.

The other caveat with balance transfer cards is that it can be difficult to qualify without a good credit score. According to the Consumer Financial Protection Bureau (CFPB) , 98% of balance transfer volume in 2021 and 2022 was by consumers who had a credit score of 660 or higher.

Just like any other credit card, you’ll have to apply and get approved for a balance transfer card. Oftentimes, that process will trigger a “hard inquiry,” which is when a creditor reviews your credit history. Several hard inquiries in a short period can negatively impact your credit score.

4. Reach out to a nonprofit credit counseling firm

For those with lower credit scores who can’t get a balance transfer card, a nonprofit credit counseling agency may be helpful.

Money Management International and GreenPath are two of the most well known and offer a range of services, including debt management plans, credit counseling and financial education. They can also negotiate with credit card companies on your behalf.

“They’re going to work to help you pay it all back, but they’re also going to cut a more favorable deal with the card issuer,” Rossman said.

To check whether a credit counseling agency is legit, make sure they are certified by the National Foundation for Credit Counseling (NFCC) .

By contrast, Rossman doesn’t recommend for-profit debt settlement companies like National Debt Relief, which he said can ruin your credit score.

“They tell you to stop paying for a while, and then they try to use it as leverage to negotiate a settlement. But it may not work, and even if it does, the late payments are really bad for your credit,” Rossman said.

And unlike credit counseling agencies, debt settlement companies usually can’t get better terms than you can by negotiating with the lender yourself, according to the CFPB . You can learn more about what to look out for here .

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