5 Money Tips for Millennials To Pay Down Credit Card Debt

If you’re a millennial struggling with credit card debt, you’re far from alone. Despite earning more than previous generations, millennials in Canada are carrying heavier debt loads than ever — and credit card balances are a big part of that story.

But here’s the good news: with the right approach, you can pay it off and take back control. Whether you’re juggling student loans, high living costs, or just trying to stay afloat, this guide will walk you through practical tips that actually work for real life.

Let’s dive into why millennials are dealing with so much debt — and five smart ways to finally get ahead of it.

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Millennials Make More… But Owe Even More

Yes, millennials typically earn more than their parents did at the same age. But they’re also saddled with record-breaking debt.

According to Statistics Canada, the average debt-to-income ratio for millennials hit 216% in 2016 — nearly double that of Gen-Xers in 1999. That means for every dollar of after-tax income, millennials owe over two dollars.

So what’s behind this spike?

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Why Are Millennials Carrying So Much Debt in Canada?

Let’s break it down.

🎓 1. Higher Education Costs

Degrees are more expensive than ever. Even with student loans and financial aid, many millennials graduate with tens of thousands in debt — and credit cards are often used to fill the gap.

🏠 2. Expensive Housing Market

Buying a home is a financial stretch in almost every Canadian city. With house prices outpacing wage growth, many millennials rely on credit to handle everything from rent to renovation dreams.

💸 3. The Millennial Wealth Gap

Wealth is increasingly concentrated in the hands of a small few. Stats Canada reports that the top 10% of millennials own over half of the generation’s total net worth. That leaves many millennials without the financial cushion previous generations had.

💳 4. Growing Credit Card Reliance

The average Canadian carried about $4,300 in credit card debt in 2019 — but millennials bear a disproportionate share. With inflation driving up everyday expenses, many are leaning on plastic to stay afloat.

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5 Practical Money Tips to Pay Down Credit Card Debt

If you’re feeling overwhelmed, don’t panic. These five tips are simple, actionable, and designed to help you make real progress — even if you’re starting small.

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1. Start With a Budget That Actually Works

Before you can pay down debt, you need to understand your money.

Try the 50/30/20 rule:

• 50% of your income goes to needs (housing, groceries, bills)
• 30% goes to wants (eating out, entertainment)
• 20% goes toward debt repayment and savings

This method gives you a structure without being too restrictive. Bonus tip: track your spending for 30 days using a simple spreadsheet or budgeting app — it’s eye-opening.

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2. Focus on One Debt at a Time (Snowball or Avalanche)

You’ve probably got multiple cards or loans. The key is to tackle them strategically.

Debt avalanche: Pay off the highest interest rate debt first.
Debt snowball: Pay off the smallest balance first to build momentum.

Both methods work — just choose one and stick with it. Consistency is more important than perfection.

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3. Always Pay More Than the Minimum

It’s tempting to only make the minimum payment, but this keeps you stuck in the cycle. Try to put extra cash — even $50 — toward your balance each month.

Why it matters:

• You’ll pay less interest overall
• You’ll be debt-free sooner
• It helps improve your credit score faster

Set up automatic payments if you can, so you’re always hitting more than the minimum.

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4. Never Miss a Payment

Late payments = late fees + interest + a hit to your credit score.

Avoid the mess by setting up reminders or auto-pay for your credit card bills. Even if you’re only making the minimum, paying on time helps protect your credit profile.

🧠 Pro tip: If you’re struggling, call your credit card issuer. You might be able to negotiate a lower interest rate or a modified payment plan.

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5. Consider Consolidating Your Debt

Debt consolidation can make your life easier — and cheaper.

This involves rolling your high-interest debts into a single monthly payment, often at a lower interest rate. You could use a:

• Personal loan
• Balance transfer credit card
• Line of credit

Just be sure to read the fine print. Some offers come with fees or short-term promotional rates.

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FAQ: Millennials & Credit Card Debt

What percentage of millennials are in credit card debt?
Roughly 87% of millennials in Ontario reported having credit card debt in 2021, according to Hoyes, Michalos & Associates.

Which age group has the highest credit card debt in Canada?
Millennials top the list, holding more credit card debt than Gen-X or Baby Boomers.

What’s the best way to pay off credit cards as a millennial?
Start with a solid budget, use the snowball or avalanche method, make more than the minimum payment, always pay on time, and explore consolidation options.

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Final Thoughts: You Can Do This

Paying off credit card debt isn’t just about numbers — it’s about freedom and peace of mind. And while millennials may be facing bigger financial challenges than generations before, that doesn’t mean debt has to define your future.

With a few smart habits and a bit of patience, you can build a solid foundation, improve your credit score, and breathe easier knowing your money is working for you — not against you.

You’ve got this. And if you need help figuring out the next step, we’re always here.

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