My credit card balances are too high. What can I do?

Picture this: In a few days, your credit card payment is due.

You log into your account and your balance shocks you. You wonder, “How is my credit card balance so high?” After looking at your transaction history, you see groceries, gas, a night out with friends … everything looks normal, but the balance is tough to swallow. You know you can’t pay it off this month and probably not next month, either.

Does this situation sound familiar? If so, you’re not alone. If you’re dealing with a high credit card balance, here are some tips to help you climb out of the red.

• Find the culprit
• Assess the damage
• Take action

Find the culprit

A few swipes here and there may not seem like a big deal, but when you see your final balance, it may be a big wake-up call that you spent too much money. There are various reasons you may find yourself saddled with a high credit card balance, so it’s important to find the culprit and stop the bleeding, suggests Erin Lowry, founder of the blog Broke Millennial.

“Was it due to a misunderstanding of how credit cards work and how to budget, or more because of a compulsion to purchase items? This is a crucial question to ponder when addressing how to dig out of debt,” Lowry says.

Culprit No. 1: Overspending

One reason you may be in debt is that you’re overspending and simply not realizing it. A study by the Journal of Consumer Research reported that “The use of a credit card as a payment mechanism increases the propensity to spend as compared to cash in otherwise identical purchase situations.” In other words, credit cards may tempt consumers to spend more than they ordinarily would with cash.

“Start identifying places where you can make adjustments. Cutting back on discretionary spending — nonessentials like nights out, new clothes and fancy haircuts — will enable you to put more toward your balance each month, bringing you that much closer to enjoying those discretionary indulgences without the burdensome cost of interest,” says millennial personal finance expert Stefanie O’Connell.

Culprit No. 2: Insufficient income

Let’s face it … being an adult is expensive. Rent, insurance, groceries, gas and utilities add up quickly. If you aren’t making enough to pay your bills, here are some strategies to consider.

• See if you can negotiate lower bills for things like Internet and phone service — you can try this by calling your provider.
• Focus on lowering the biggest three expenses: housing, food and transportation. This may involve making big changes such as moving or selling a car.
• Take on a side job like babysitting, pet-sitting or consulting.

Assess the damage

Seeing your high credit card balance may make you want to run for the hills, but ignoring your debt isn’t a good move. It could lead to late payments, default and more, leaving you with damaged credit scores and in worse shape than before.

As hard as it may be, it’s important to assess the damage.

• How much do you owe?
• What is the interest rate on each balance?

“Listing your balances, minimum payment amounts and interest rates for each lender can give you a very clear way to visualize where you stand, which will help you determine the best way to begin,” O’Connell says.

Take action

Once you’ve listed your credit card balances and interest rates and determined the cause of debt, it’s time to take action.

First step: Start to pay down debt. Carrying large balances can affect your credit utilization, which in turn could affect your credit scores. Your credit utilization is how much of your total credit limit you actually use. Typically, keeping your cards’ balances below 30% of their total limit is a good idea. If you’re consistently racking up debt to the limit, you may be considered a risk to your lender.

You have a number of repayment options. You can focus on paying off the credit cards with the highest interest rate, which will save you money over time. This method is commonly referred to as the “debt avalanche” method — you focus on paying high interest debt first, while paying the minimum on the rest.

Or you can use the “debt snowball” method, which focuses on paying off the smallest balance first, while paying the minimum on the rest. The debt snowball is good for keeping up motivation as you can feel like you’re progressing quickly on your debt. There’s no right or wrong answer — one path may save you money, while the other provides motivation.

While paying down your credit cards, you may want to use cash or debit cards as an alternative.

If your balance is substantial and accompanied by high interest rates and you have good credit scores, a balance transfer to a lower-interest card may help.

“Many lenders offer balance-transfer deals with introductory rates as low as 0% APR. That means you won’t be charged interest on your balance for the term of the introductory period, giving you a chance to pay down your balance interest-free,” O’Connell says.

It’s key to look at any associated fees that may accompany the balance-transfer offer and come up with a plan to pay off debt, not just make minimum payments, O’Connell adds.

Bottom line

Carrying a high balance on your card could negatively affect your credit scores and lead to you paying more in interest.

Using the strategies mentioned above you can work to tackle your high credit card balance and work toward debt freedom.