Credit card debt is a major financial concern of many people.

While not everyone has a credit card, those who do, usually sport huge balances on their credit cards

The interest rate on a credit card balance in UAE is usually between 25% -36% PA. Such high interest rates make it difficult for people to pay off their debt — especially if one is only making the minimum payment due.

In fact, just making minimum payments can take even the smallest credit card balance over a decade to pay off.

For those who have stacked up debt on various cards, here is a fool proof pay off strategy.

If you follow a few basic steps and put a plan (Financial Planning) in place, you can work to pay off your debt sooner, with less interest.

  • Use an excel sheet  and list your credit cards.  Fill the columns for outstanding balance, interest rate, and minimum payment payable etc… This information can easily be found on your last monthly statement.
  • Arrange the list, so that the credit card with the highest interest rate is at the top, and the lowest is at the bottom.
  • Prepare a budget of your monthly income and expenses including card and loan payments
  • Now take a close look at your budget, use a magnifying glass or a microscope if necessary.
  • Identify see how much extra you can come up with each month in addition to the minimum payment on the card with the highest interest rate. It doesn’t matter even 100 or 200 dirhams can make a significant impact.


  • As your payments come due, pay the minimum on each card except for the one at the top of your list.
  • Whatever additional money you budgeted in the previous step, pay it along the minimum due. Keep paying the same amount irrespective of the minimum due, till the card is paid off.
  • When this card is paid off, continue with the minimum payments on the other cards, but now take the amount you were paying on the first card in addition to the minimum payment and apply it to the second card on your list.
  • Repeat this process until all cards are paid off.

Why and how this works?

Wonder why Credit Card Pay Off Strategy works?

To understand why a relatively simple process works it’s important to understand how minimum payments work. Minimum payments are calculated as a percentage of the outstanding balance.

Which means as your card balance slowly decreases, so does your minimum payment. This is why it can take ten years or more to pay off even a small balance if you are only make the minimum payment each month.

With this system, your monthly payment is remaining constant regardless of your balance.

So each month your required minimum payment may go down, but because you are ignoring minimum payment and paying in excess of the minimum payment, you are applying more and more money to your principal as time goes on, thus accelerating your debt repayment.

Starting with the highest interest rate ensures you’re targeting the most costly credit up front to minimize the total amount of interest you pay.

Getting rid of credit card debt

A Few More Tips

While this payment strategy will help you get out of debt, you can potentially make things go even faster with a few other tips. First, call your credit card company and ask for a waiver on the annual fees. This won’t always work, but if you have been on time with your payments, they may be willing to work with you. It doesn’t hurt to try and it doesn’t cost anything. The worst they can do is say no.

Don’t forget about balance transfers. Again, it isn’t always easy to get credit and the balance transfer deal may not be the best, but if you can find a way to transfer the balance from a card go for it. There may be some special 0% offers as well. Barclay’s are now offering 0% interest up to 12 months on balance transfer; don’t forget to understand the fine print though.

Finally, keep in mind that this process still takes time. There is no magic method of paying off debt, so realize that it will still take months or even a few years to become completely debt-free. But what we’re doing is putting a process in place to make sure that you can get out of debt as soon as possible. You can speed up the process if you continue to pay even more money towards your debt as your budget allows.

Feel free to call me on +97150-2285405 or mail me on, if you have any questions or if you need any assistance on this.

Good Luck.

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