Avoid Credit Card Debt Wealth Builders rarely use credit cards. When they do, they pay off their balances every month. When a credit card balance is not paid off monthly, it means paying interest—often 20 percent or more a year—on everything purchased. So think of credit card debt as a high-interest loan.

Do you need to reduce your credit card debt? Here are some suggestions.

Pay cash. Set a monthly limit on charging, and keep a written record so you don't exceed that amount. (Remember your daily expense sheet? Use it to keep track.) Limit the number of credit cards you have. Cut up all but one of your cards. Stash that one out of sight, and use it only in emergencies. Choose the card with the lowest interest rate and no annual fee, but beware of low introductory interest rates offered by mail. These rates often skyrocket after the first few months. Do not apply for credit cards to get a free gift or a discount on a purchase. Steer clear of blank checks that financial services companies send you. These checks are cash advances that may carry a higher interest rate than typical charges. Pay bills on time to avoid late charges.