By Grant MercerLast updated Oct. 7, 2026Image: Nicola Barts/Pexels
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Credit cards that carry a balance charged an average of 22.15% interest1 in May 2026, according to the Federal Reserve. On a $10,000 balance, that’s about $185 a month in interest alone, before a single dollar comes off what you owe.
On a fixed income, that math doesn’t work for long. The minimum payment barely touches the balance, and every month the interest takes a bigger bite out of your Social Security check.
The good news: you have more options than you might think, from a free phone call to a full debt settlement program. Here’s how retirees are getting out from under it:
High-Interest Debt: See the debt relief options that may be available
If your card balances have grown beyond what you can realistically pay down, debt relief is one option to compare alongside a lower-rate loan and nonprofit credit counseling.
CuraDebt connects consumers with independent debt relief providers. If you have $15,000 or more in unsecured debt, such as credit cards, medical bills or personal loans, a free evaluation shows the options that may be available before you decide anything. Debt amount is one factor and does not determine qualification.
Here's how it works:
- Answer a few questions about what you owe.
- A specialist reviews your balances and explains the options that may be available.
- If a program fits, you see the estimated cost and timeline before you decide.
Advertisement. CuraDebt connects consumers with independent debt relief providers. Results not guaranteed. Debt amount is only one factor and does not determine qualification. Not all consumers qualify, and not all debts are eligible. Creditors are not required to agree to settlements. Debt relief services may adversely affect your creditworthiness. Typical program duration is 24 to 48 months. This site may be compensated for referrals to CuraDebt.
At 22% interest, a $10,000 card balance with a $250 monthly payment takes more than six years to pay off and costs over $8,000 in interest along the way.
Big Balances: Ask this company to negotiate your card debt down
If your card balances have grown to the point where you’d need years of minimum payments just to make a dent, a debt relief company can negotiate with your creditors to accept less than the full balance.
JG Wentworth, a name many people know from structured settlements, also runs a debt relief program for people with significant unsecured debt. You make one monthly deposit, and the company negotiates each account as funds build up.
Ask for the total fee, the estimated timeline and what happens if a creditor sues while you’re enrolled.
See if you qualify for JG Wentworth's debt relief program
Debt settlement is not available in all states, and fees apply when debts are settled. Settling debt for less than you owe will likely hurt your credit, may lead to collection activity or lawsuits while accounts are being negotiated, and forgiven debt may be taxable.
Card Interest: Replace a 22% rate with one fixed payment
If your credit is still in decent shape, a debt consolidation loan can pay off every card at once and leave you with one fixed monthly payment and a firm end date, often at a much lower rate than the cards charge.
Cut a 22% rate in half on a $10,000 balance and you save roughly $90 a month in interest, money that goes toward the balance instead.
LendingTree lets you compare personal loan offers from multiple lenders in one place, and checking your rates won’t affect your credit score. Once the cards are paid off, put them away so the balances don’t come back.
Compare debt consolidation loan rates on LendingTree
Once a consolidation loan pays off the cards, keep your oldest card open with a zero balance. Closing it can lower your score by shrinking your available credit.
Fair Credit: See consolidation offers from dozens of lenders at once
If your score took a hit from high balances, you may assume a consolidation loan is out of reach. Many lenders work with fair credit, and the only way to know what you’d be offered is to check.
Monevo sends one short form to dozens of lenders and shows the offers you prequalify for, without affecting your credit score.
Compare the APR and any origination fee, not just the monthly payment, and make sure the new payment fits your budget before you accept.
Compare consolidation loan offers with Monevo
Credit Report Errors: Get mistakes removed that are costing you a better rate
A lower score means higher rates on everything from a consolidation loan to car insurance, and credit reports are wrong more often than most people think: old debts that should have dropped off, accounts that aren’t yours, late payments that weren’t late.
You have the right to dispute inaccurate items with each credit bureau. Credit Saint handles the disputes for you and follows up with the bureaus and creditors.
It’s a paid monthly service and it can only remove items that are inaccurate or can’t be verified.
See how Credit Saint disputes credit report errors
Medical Bills and Cards: Settle both in one program
For a lot of retirees, the debt isn’t just cards. It’s a hospital bill, a dental bill and a card balance that grew while paying them.
Americor works with people who have unsecured debt, including credit cards and many medical bills, and negotiates with creditors to reduce what’s owed. A consultation shows which of your debts qualify and what the monthly deposit would be.
See if Americor can help with your balances
Debt settlement is not available in all states, and fees apply when debts are settled. Settling debt for less than you owe will likely hurt your credit, may lead to collection activity or lawsuits while accounts are being negotiated, and forgiven debt may be taxable.
Debt Consolidation: Get a second set of loan offers
Loan rates vary a lot from one lender to the next, even for the same borrower. Checking a second marketplace is the easiest way to make sure you’re not leaving a lower rate on the table.
Credible shows prequalified personal loan rates from multiple lenders, and checking your rates uses a soft credit check that won’t affect your score.
Use the loan to pay off every card at once, then put the cards away so the balances don’t come back.
Compare personal loan rates with Credible
Credit Score: Watch your credit while the balances come down
Paying down cards lowers your credit utilization, one of the biggest factors in your score. Watching it climb is real motivation, and monitoring also flags new accounts or inquiries you didn’t open.
IdentityIQ tracks your credit reports and alerts you to changes, so you can see progress and catch fraud or errors early. It’s a paid monthly service.
Start credit monitoring with IdentityIQ
Late Payments on Your Report: Challenge the ones that aren't accurate
Once balances are under control, the late payments and collection accounts left behind can keep your score low for years, and a low score means higher rates on everything from car insurance to a consolidation loan.
You have the right to dispute anything inaccurate or unverifiable. Lexington Law is a law firm that handles credit report disputes for you, with a free consultation first.
It’s a paid service and can only challenge items that are inaccurate, incomplete or can’t be verified.
Get a free credit report consultation from Lexington Law
Collection Calls: Know what collectors can't take
Collectors count on people not knowing the rules. Federal rules require banks to protect two months of directly deposited Social Security, SSI and VA benefits from most private creditors, and collectors have to prove a debt is yours when you ask in writing.
RetireShield’s Bank Account & Debt Protection Kit explains the two-month rule, the exact debt validation steps, and what to do if your account is frozen.
Get the Bank Account & Debt Protection Kit
Tax Debt: Deal with the IRS before it takes part of your check
Card debt is bad. IRS debt is worse. Penalties and interest add up every month, and the IRS can take part of your Social Security check to collect.
Tax Network USA works with the IRS on your behalf to set up payment plans, request penalty relief or, for some taxpayers, settle for less than the full amount.
See if Tax Network USA can help with your IRS balance
Home Equity: Use the house to clear the cards, with no monthly payment
If you’re 62 or older and have significant equity in your home, a reverse mortgage can pay off card debt and an existing mortgage, with no monthly mortgage payment afterward.
Mutual of Omaha Reverse Mortgage can show you how much you could access. The loan balance grows over time and is repaid when the home is sold or you move out, you still pay property taxes and insurance, and federal rules require a counseling session first.
Here’s how it works:
- Share your age, ZIP code and a rough estimate of your home’s value.
- A licensed loan officer shows how much you could access and how you’d receive it.
- Complete the required HUD-approved counseling session before anything is final.
Learn how a reverse mortgage works with Mutual of Omaha
Behind on Payments: Check if you qualify to settle your card debt for less
Once you’ve missed a payment or two, creditors are often more willing to accept less than you owe, because they’d rather get something than send the account to collections.
National Debt Relief is one of the largest debt settlement companies in the country. If you have $15,000 or more in unsecured debt, a free evaluation shows how much you might save and how long it would take.
You pay nothing until a debt is actually settled.
See if your $10K+ in debt qualifies with National Debt Relief
National Debt Relief is a debt settlement company, not a lender. Debt settlement is not available in all states, and fees apply when debts are settled. Settling debt for less than you owe will likely hurt your credit, may lead to collection activity or lawsuits while accounts are being negotiated, and forgiven debt may be taxable.
Home Equity Without a Loan: Pay off the cards with cash from your house
If you own a home with a lot of equity but don’t want a new loan or a monthly payment, a home equity investment can give you a lump sum today in exchange for a share of your home’s future value.
Hometap has no monthly payments and no interest. You settle up when you sell, refinance or buy them out, within 10 years. If your home rises a lot in value, you give up a meaningful share of that gain, so compare it against a reverse mortgage or a consolidation loan first.
See how much cash Hometap could offer on your home
Last Resort: Talk to a debt relief company before you file for bankruptcy
If your debt is so large that bankruptcy is on the table, talk to a debt relief company first. Bankruptcy stays on your credit report for up to 10 years, while debt settlement typically takes a few years to complete.
Accredited Debt Relief offers debt settlement and, for people who qualify, consolidation loan options. A consultation shows which path fits your balances before you commit.
See if Accredited Debt Relief can help with your balances
Debt settlement is not available in all states, and fees apply when debts are settled. Settling debt for less than you owe will likely hurt your credit, may lead to collection activity or lawsuits while accounts are being negotiated, and forgiven debt may be taxable.
The right option depends on how much you owe, your credit and how much room is in your budget. If you can afford one payment at a lower rate, start with a consolidation loan. If you can’t, a debt relief program is the next step.
For more money moves like these, sign up for the free Retirement Money Brief.
