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Next Gen Econ > Homes > How to stop the cycle of maxing out your credit cards
Homes

How to stop the cycle of maxing out your credit cards

NGEC By NGEC Last updated: July 31, 2025 13 Min Read
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Five years ago, Taylor Gothard, 41, and his spouse found themselves staring at $100,000 in credit card debt spread out over 17 maxed-out credit cards. When it comes to debt like this, they’re not alone. Nearly 40 percent of cardholders have maxed out a credit card or come close in the last few years, Bankrate’s Credit Utilization Survey found.

One of the worst traps that can land you in debt is applying for — and receiving — credit cards and then maxing them out. So how do so-called credit card “maxers” end up in this vicious cycle of accumulating cards, running up their balances and struggling to repay them?

There are many reasons, from emotional stressors and misunderstandings about how credit cards work to systemic challenges, says Lindsay Bryan-Podvin, Cash App’s financial therapist and founder of Mind Money Balance.

In the personal finance world, there tends to be a lot of blame directed at individuals who max out their credit cards. [They] are framed as irresponsible or obsessed with keeping up with the Joneses.

— Lindsay Bryan-Podvin, financial therapist and founder of Mind Money Balance

However, credit cards can feel like a lifeline when navigating major life transitions (like divorce or job loss) or when facing underpaid or unstable employment, says Bryan-Podvin. “Bigger systemic issues, such as the high costs of medical care, can also contribute to maxed-out credit cards,” she says.

If you find yourself in the same position as Gothard and so many others, here’s what it takes to not only dig yourself out of debt, but how to stop repeating the pattern.

Good intentions, bad results

When you get your first credit card, it’s exciting. You’re building your credit, you’re careful about card spending, and you either make regular payments or pay off your monthly balance.

Then you get comfortable swiping your card at stores, restaurants, for travel and more, because it’s easy. You notice that your spending — and your credit utilization — is rising, and you’re approaching your credit limit. But you justify the spending because you feel you’re still in control, even though it’s costing you.

Card offers — especially those with generous welcome bonuses — are tempting, so you add more to your wallet. You believe you’re still in control, but there’s pressure to maintain a lifestyle — travel, dinners, shopping and more — that’s funded by your growing portfolio of credit cards.

People are social creatures, and belonging matters tremendously, says Bryan-Podvin.

When a person spends to keep up with the Joneses, I often see it as a desire for connection and a sense of belonging. If someone falls into this category, I find it much more helpful to get curious about their desire to belong than to shame them for overspending.

— Lindsay Bryan-Podvin, financial therapist and founder of Mind Money Balance

But if someone is experiencing financial hardship, swiping a card can be about survival, says Bryan-Podvin. “Even though the behavior — charging more than you can pay off — looks the same on the outside, the `why’ underneath it can be wildly different,” she says.

The road to credit card maxing

Gothard was only 12 years old when he got his first credit card. “It was a Capital One Mastercard that my parents gave me as an authorized user, with a $300 limit.”

As a child, Gothard took regular out-of-state, multiple-day field trips with his magnet school. “My parents wanted me to have a safe way to travel without having to rely on travelers’ checks or cash. When you’re a young teenager in a big city, you’re a prime target for pickpockets.”

Playing the points and miles game in early adulthood was the next step, said Gothard. “I wanted to unlock fun travel experiences,” he says. “Our air tickets were all paid for by air miles that we received through credit card programs, and we were both responsible when managing those cards.”

Between Gothard and his spouse, they eventually had seven Capital One credit cards. “For a long time, the [cards] were on promotional rates, so either 0 percent or really low interest rates. Early on, it was pretty easy to pay off the balance each month,” he said.

Then, there was a job loss that lasted six months and threw them for a loop. “We [originally] felt we were pretty safe with our incomes, so we had just signed a new lease at our same apartment complex, moving up from a one bedroom to a two bedroom, which was significantly more expensive,” Gothard says. “At that point, we were relying on our credit cards to make ends meet until the unemployment was over.”

Maxer warning signs

Regardless of the circumstances that lead to carrying credit card debt, Bryan-Podvin sees common signals in people who are losing control of their card spending, including:

  • Actively avoiding banking or credit card statements, mail notices and phone calls
  • Reflexively putting expenses on a card without first checking whether it’s an expense you can afford, which signals a habit instead of an intentional decision
  • Playing a financial shell game by opening up new balance transfer or 0 percent interest rate cards or personal loans without having a plan to pay them off
  • Lying to people who should know about your finances regarding the reality of your credit card debt

“This doesn’t mean your neighbor needs to know your financial reality, but if you’re actively hiding this from your spouse, it’s a problem,” she says.

As a result of this rising debt, your credit score plummets and applying for new credit cards is no longer an option. Your bills pile up, but your income doesn’t. Before you know it, your credit cards are maxed out, and you’re facing challenges including home eviction, having your car repossessed or even losing your job.

Shame also plays a huge role in people who max out their credit cards, says Bryan-Podvin. “Shame tells us we’re ‘bad with money’ instead of ‘a person who overspent on a credit card,” she says. “That kind of financial shame makes people freeze or spiral with thoughts like, ‘Why bother? You’re already in too deep.’”

Denial is a short-term protector from overwhelm or discomfort, says Bryan-Podvin.

The problem is that denial can keep us frozen in the long term. Many of my clients avoid looking at their balances or skip conversations about money because they find it too painful or awkward. Instead, it’s important to say, ‘Yes, this might be uncomfortable. And, we need to get clear on what’s actually going on so you can start taking healthy action.’

— Lindsay Bryan-Podvin, financial therapist and founder of Mind Money Balance

Digging out of debt

Taking charge of your maxed-out cards means getting honest about where you stand financially. Gather your latest credit card statements, add up what you owe and then stop using your cards. Download an app or create a spreadsheet to track how you’re spending your money so that you can create a realistic budget and figure out the best way to tackle your debt. Possible strategies include:

Gothard and his spouse discovered their cards with promotional rates were expiring or had expired, and their card payments were no longer manageable, even though they were still making minimum payments.

“We were well aware of the debt we were accumulating and saw that our balances weren’t coming down,” he says. “At that point, I said if we’re going to do anything to make things better for us in the long term, we need to put our cards in the sock drawer or cut them up and set ourselves up for success.”

Gothard chose nonprofit debt counseling agency Money Management International (MMI) to help him and his spouse pay back their ballooning credit card debt. “Out of all our options, MMI had the best relationship with Capital One, which is where the bulk of our debt was. Other services charged a 10 percent interest rate, while MMI was only 1.9 percent, which was a significant savings,” he says. “MMI’s monthly fees were much less than the competition, at $25 a month.”

Breaking the cycle

Of course, it’s not enough to pay off your maxed-out credit cards. You also need to face — and fix — the bad habits that caused the debt in the first place. Life happens, so don’t allow shame and fear to keep you from getting help.

It takes time, but you can pay off your credit cards — I’ve done it. But you must also avoid sliding back into old habits by learning new ones that encourage strong financial health for the long term. Strategies for doing that include:

It’s also important to make sure you have a plan to reduce big expenses, such as car payments or housing, says Bryan-Podvin. “Increasing income helps create a larger buffer between income and expenses, so if something does have to go on a card, there’s a way to pay it off,” she says.

Finally, work on your financial boundaries. That could mean saying no to a trip, pausing a subscription or having a money conversation with a partner or friend.

— Lindsay Bryan-Podvin, financial therapist and founder of Mind Money Balance

The bottom line

When their debt was at its highest, Gothard and his spouse saw their credit scores plummet. “Capital One’s credit service said I was in the high 500s and my spouse was in the low 600s,” he says.

But Gothard wants credit card maxers to know there’s a light at the end of the tunnel — and that you’re not alone — when it comes to big debt. He and his spouse now have a curated set of six credit cards and approach maximizing travel rewards in a healthier way.

“My credit score is just over 700, and my spouse is in the 770s,” says Gothard. “We’re focused on keeping our balances low and paying them off. Homeownership within the next two to three years is our long-term goal.”

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