How to Get Money Without Going into Credit Card Debt

In today’s world, credit cards are a go-to solution for quick cash. However, their high-interest rates can quickly turn convenient borrowing into a mountain of debt. In 2024, the average credit card interest rate reached more than 22%, making it harder for people to manage their balances. Also, by the second quarter of the same year, U.S. credit card debt hit over $1.14 trillion, with the average cardholder owing around $6,501 (Federal Reserve Bank, Experian).

But don’t worry! There are smarter, more cost-effective ways to get money without falling into the credit card trap. Keep reading to learn how to avoid high-interest credit cards and stay financially stable.

1. Personal Loans for Lower Rates

Instead of racking up credit card debt, consider getting a personal loan from your bank. These loans often come with significantly lower interest rates, meaning you can pay off your debt faster. Specifically, many banks offer personal loans with rates as low as 5-6%, which can greatly reduce your financial burden over time. Plus, with fixed monthly payments, you’ll know exactly what to expect each month, which simplifies your budgeting process.

2. Cash-Out Refinances for Homeowners

If you're a homeowner, cash-out refinancing could be your ticket to accessing money at a much lower interest rate. This involves refinancing your mortgage for more than what you owe and pocketing the difference. With mortgage rates averaging around 6.73% in July 2024, this could substantially lower your interest costs compared to credit cards. Consider speaking with a mortgage loan advisor to understand the full implications, including any fees or changes to your loan term.

3. Home Equity Line of Credit (HELOC)

A HELOC gives you access to cash based on your home's equity. Unlike a fixed loan, a HELOC allows you to borrow as needed, paying interest only on the amount drawn. This flexibility—coupled with typically lower interest rates—can make it an attractive option for homeowners, especially if you have significant expenses on the horizon.

4. CD Term Loans from Your Bank

If you have a certificate of deposit (CD), consider a CD term loan , or “CD-secured loan.” This allows you to use your CD as collateral while still earning interest on it. CD term loans often come with lower interest rates and can be secured quickly, making them a convenient option for temporary cash needs. Plus, you won’t face any early withdrawal penalties, so you to access cash without disrupting your savings plan.

5. Tax Refunds and Deductions

Another potential cash source is your tax return. If you are expecting a refund, consider filing early to get your funds sooner. Ensure you claim all available deductions and credits to maximize your tax refund. Deductions such as student loan interest, education, mortgage interest, or energy-efficient home improvements can reduce your tax liability.

6. Cash Advances from Friends or Family

While it might feel awkward, borrowing from friends or family can be a viable option. Many loved ones won't charge interest, making this a low-cost way to access funds.

PRO TIP: To avoid misunderstandings, set clear repayment terms and timelines from the start.

7. Side Gigs or Freelancing

Sometimes the best way to get cash is through additional income streams. Consider side gigs, freelance, or contract work to bring in extra money. Not only can this provide immediate funds, but it can also help build a more diverse income base for the future. Plus, the gig economy is booming, giving you flexible options to fit your schedule.

8. Sell Unused Items

Decluttering your home can be both therapeutic and financially rewarding. Look around your home and identify items you no longer need. Selling your things on platforms like eBay, Facebook Marketplace, and Craigslist—or even through a garage sale—can quickly generate extra cash. Remember, one person’s trash is another person's treasure!

A Little Financial Help from Academy Bank

Accessing cash doesn't have to mean falling into a cycle of debt. With a bit of planning and the right financial tools, you can manage your finances effectively and sustainably.

If you are exploring financial options, consider our banking solutions. Academy Bank offers personal loans,¹ cash-out refinancing,² HELOC options,³ and CD Term Loans⁴—all designed to prioritize your financial well-being.

Additionally, explore our suite of online financial calculators, including the Credit Card Payoff Calculator and HELOC Calculator, to help plan your financial future.

Ready to take control of your finances? Get started today!