Your debts are mounting, you’re falling behind on payments and you don’t know who to pay first. Isn’t it time to get your financial house in order?
Start by listing your income and expenses and developing a realistic budget. Are you living on credit cards because you’re spending more than you bring in?
There are plenty of tips to cut expenses – refinance your mortgage, stop eating out, cut unnecessary subscriptions, examine your phone, Internet and TV plans, drink water instead of soft drinks, review your insurance, cancel your vacation. The list goes on.
Be sure to look at the fees you’re accumulating because of late payments or overdrafts. A reasonable interest rate on a credit card can jump up significantly when you don’t pay on time. No wonder you can’t sleep at night.
For those who are truly serious about eliminating debt, you may want to consider consolidating debt into a personal loan. There are many advantages.
- Make only one payment – Each credit card payment counts separately. Miss three and that’s three strikes against you.
- Improve your credit score – Paying off your credit cards frees up capacity, which counts 30 percent of your credit score. Having an installment loan also can improve your mix of credit, which counts 10 percent of the score.
- Get out of debt faster – Your payments may be the same or even a little higher, but you’ll pay less in interest over the life of the loan and you’ll pay the debt off faster.
At Family Trust, our Member Service Consultants can review your credit report to see if you’re a candidate for consolidating debt. You’ll get one-on-one advice for your personal situation so that we can agree on the best plan for you. If a debt consolidation loan is a possible solution, we can help you with the application process. Once approved, we can use those funds to pay off the designated debts for you. You’ll make one payment to Family Trust.
The key isn’t to just pay off debt but to change your spending habits. Consolidating your debts can give you a fresh start but only if you’re committed to developing the required discipline going forward.
Isn’t it time you gave it a try?