This is going to make no sense at first, but hear me out: You need to work on building up your savings before you work on paying off your credit card debt.

It sounds counterintuitive, but this is how you break the cycle of credit card debt. You need to have money saved for future expenses so you can stop relying on your credit cards to pay for gaps in your budget.

The Cycle of Credit Card Debt

Let’s demonstrate why with our makebelieve friend, Abigail.

Abigail has $3,000 in credit card debt. She is currently paying $500 per month toward her credit cards but has no money in savings.

When her car needs repairs, she doesn’t have the cash to pay for the repair, so she ends up putting $500 worth of repairs on her credit card. Even though she paid $500 toward it this month, her balance is the same. She has $3,000 in credit card debt again. And now she’s paying interest on a car repair that could have been paid from savings.

Abigail is spending more and still has nothing in savings.

When the next unexpected bill comes in, she will have to use a credit card because the $500 in extra funds is already earmarked for her credit card. She’s not building in any sort of cushion, so the cycle continues.

Regardless of the numbers, it’s the emotional rollercoaster of endless credit card debt that is most important here. Abigail feels good when she makes a big $500 payment to her card. She’s excited because she feels like she’s getting ahead. Two weeks later, she has to charge $500 to the credit card for an unplanned expense, so she feels frustrated and discouraged for not truly getting ahead. But if she was saving a large portion of that $500 payment, she could break the cycle and actually come out ahead.

By saving a portion of your money and not putting 100% toward your credit card, you have a better chance of getting off this credit card rollercoaster.

Start Saving If You Want to Eliminate Credit Card Debt

The moral of the story: Designate money for savings as you are paying off debt. In the example above, I would have advised Abigail to save part of the $500 she has available each month because it will prevent future bills from having to go on her credit cards.

I can’t begin to tell you the number of clients who have used this method successfully. Not only are they funding savings accounts for expenses like medical bills or car repairs, but they are also saving for vacations. And the best part: They’re doing it all while they are continuing to pay down their debt.