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Overspent? Debt consolidation can save you hundreds of dollars

Posted by Community Choice Credit Union on Jan 3, 2017 1:47:14 PM

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Were you enticed by the perks of a store credit card this shopping season? Did you overuse your credit cards? Don’t panic—debt consolidation can help. Debt consolidation can reduce the amount of interest you’ll pay on your purchases and, in some cases, lower your monthly payments. Here’s what you need to know about debt consolidation.

You can consolidate debt through a balance transfer

Since most store cards come with an average APR of 24%, a considerable amount of your payments will go toward interest. To eliminate this, you can transfer the balance of your store card to your financial institutions credit card at a lower interest rate. At the start of the year, many financial institutions offer a 0% APR balance transfer offer, which allows you to save the most money while paying off your balance.

You can consolidate debt with a personal loan

If you don’t have a credit card that offers a special balance transfer APR, you can apply for a personal loan to consolidate your debt. Personal loan APRs are lower than many credit card APRs, which means you’ll pay less interest on the money you borrowed.

Here’s how much you can save if you consolidate $3,000 worth of debt that was attached to a 24% APR.

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Debt consolidation is a great way to save money, by decreasing the amount of interest you’ll pay on the money you borrowed. When you consolidate debt, it’s extremely important to avoid racking up new debt with your old credit cards. Your store cards will be paid off, so it’ll be tempting to use your credit. Just remind yourself that the high interest attached to the card isn’t worth the price … even if it’s on sale.

Have you ever consolidated your debt before?

Topics: Debt Consultation, Debt, Holiday debt, Consolidate debt, Debt Reduction

Links to third party sites are not owned or operated by Community Choice Credit Union. We are offering the link for your convenience and have no responsibility for the availability, accuracy, or content of this website, its products or services. We encourage you to review their privacy and security policies which may differ from Community Choice Credit Union.

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