Experts: How To Resume Student Loan Payments and Pay Down Credit Card Debt

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A recent study from Northwestern Mutual found that 28% of Americans consider credit cards to be their primary source of debt. However, education-related debt is a significant source of stress for many people. In fact, 17% of Gen Zers and 10% of millennials state that student loans are their main source of personal debt.

This tracks with what GOBankingRates found in a recent study of 1,028 American adults. With the student loan payment pause ending in October, many borrowers are worried that they won’t be able to manage their student loans and other financial responsibilities — such as credit card debt.

Around 20% of respondents believe they’ll have to draw from their savings or retirement accounts to keep up with student loan payments, much less high-interest credit card debt. Another 10% of individuals are concerned that they’ll end up further in debt as they try to manage all of their financial obligations.

If you have credit card debt and student loans, here are some methods to start paying down — or even paying off — multiple types of debt at once.

Start With a Budget

Having a lot of debt, especially when some of that debt is high-interest credit card debt, can feel overwhelming. But perhaps the best way to get started is to step back and take a moment to assess your situation.

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“Start with the basics,” said Andrew Housser, co-CEO and co-founder of Achieve. “Don’t panic, take a breath and begin with a budget — one that covers each month for the next 12 months, and then projects out for the life of the loan.”

You may need to make some adjustments as you go, but that’s OK. In some cases, such as when your income increases, this can even be a good thing.

“Understand that there will be a number of assumptions the further out the timeline goes,” Housser added, “and adjustments made as income increases and debt decreases.”

Having a budget is also vital for your overall financial well-being and ability to manage your debts.

“It’s like a road map for your finances, showing you where your money is going and helping you make informed decisions,” said James Allen, founder of “There are several budgeting systems and apps available, so find one that suits your lifestyle and stick to it.”

Pay Down High-Interest Debts First

“When it comes to managing debt, the best approach is to start by focusing on the highest-interest debt,” said Sebastian Jania, the owner of Ontario Property Buyers. “Credit cards are going to be higher interest rate debt than student loans, so I would recommend making the minimum payments on the student loans but paying much more than the minimum for the credit cards.”

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Make sure you’re paying at least the minimums for all debts to avoid additional interest, late fees or damaged credit. Once you’ve paid off your credit cards, start paying more than the minimums on your student loans, too. This will help you get out of debt faster — and potentially save you money in the long run.

Enroll in a New Repayment Plan

Juggling credit cards and other everyday financial responsibilities is one thing, but managing student loans along with everything else can be tricky — especially if you owe a significant amount.

That’s why Jay Zigmont — Ph.D., CFP and founder of Childfree Wealth — suggests switching to a new student loan payment plan to help budget everything in.

“Many people will benefit from enrolling in the new REPAYE/SAVE plan to lower student loan payments,” Zigmont said. “The SAVE program lowers your payment and will stop any interest over your minimum payment from accruing. With a lower student loan payment, you can focus on paying off your credit cards before knocking out your student loans.”

Cut Back on Expenses

Increasing your income and lowering your monthly expenses can go a long way toward helping you manage your student loans and credit cards.

“Consider ways to increase your income or reduce your expenses,” Allen said. “This could involve negotiating better rates on your bills, selling unused items or even taking on a part-time job or side gig. It’s like adding more fuel to your debt repayment engine: The more you have, the faster you can reach your destination.”

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Consider Debt Consolidation or Debt Relief

Several debt relief strategies, such as debt consolidation, are available to those dealing with large amounts of debt.

“Consolidating student loans involves grouping or consolidating multiple loans into one loan,” Housser said. “People frequently consolidate to move from a variable interest rate to a fixed one, or to change the repayment term. Consolidating may lower the monthly payment but also extend the repayment period. So, consider the short-term needs and long-term consequences carefully.”

Allen added, “Don’t be afraid to consider debt relief if other strategies aren’t working. This can change the amount or terms of your debt to lighten your financial burden. It’s like a lifeboat in a storm — it may not be your first choice, but it can be a lifesaver when you need it.”

Use a Balance Transfer Credit Card

A balance transfer card is a credit card that comes with either a 0% or low introductory interest rate. With one, you can move the balance from one credit card to the new one, potentially saving you money on interest. This could be a good option if you have good credit and can pay off the new card within the introductory period.

“You could consider a 0% balance transfer card to manage your credit card debt, which can reduce interest costs and accelerate repayment,” said Robert Humann, chief revenue officer at Credible. “Be sure to read the fine print and have a plan in place to pay off your debt before the 0% intro period expires.”

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Check Into Student Loan Forgiveness

While it won’t help with the credit cards, a student loan forgiveness program could work to your advantage as you work to pay down your debts.

“See if you qualify for existing loan forgiveness programs,” Housser said. “Teachers or those who work for government or not-for-profit organizations still may qualify for loan forgiveness. Other professions have programs that help repay student loans with monthly assistance, one-time payoffs or matching funds. Your industry’s association(s) or employer HR department may have information.”

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