Why Consolidate Credit Card Debt?
If you have one or multiple credit cards with outstanding debt and find it difficult to meet the monthly repayments you may want to consolidate credit card debt and save yourself time and money.
What is debt?
Debt plays an important part in our lives. It helps us build value through acquisition of assets. Unfortunately, debt can also be be detrimental if it mounts up without providing that value. Most commonly, this happens with credit cards.
Unfortunately, we are not always provided with the proper knowledge on how a credit system works, and using credit instead of our own money to make purchases can be an enticing option at the best of times.
The truth is many Australians have one or more credit cards with debt outstanding, often ranging in the thousands. Purchases made with the bank’s money need to be paid off before the interest free date expires, and in many cases, they are not.
Does this sound like you?
It’s not just the frustration of losing money to the banks, but also having to shift money from one card to the next just to stay above water. Though this might seem a good long term solution, it won’t hold weight in the long term. What you need is debt consolidation.
Merging your credit card debt allows you to streamline your debt repayments into a simplified process. While consolidating your debt won’t remove it, there are a number of benefits.
Lower rates and repayments
By securing a lower interest rate on the one loan, not only are your repayments focused on a single debt, but you’ll be paying off a lower amount and can be debt free much much sooner. The savings from the consolidation can also be used to bolster your repayments, meaning you’ll be debt free all the sooner.
In some cases it may be that your credit cards already have a low interest rate, and consolidating may not benefit the total sum by a great deal. However it is still worth considering. If you combine your credit card debt into a single loan repayment the time saved from only having to manage one repayment is invaluable. Also, let’s not forget that your credit card debt is reduced to zero, making those cards available for purchase should you need them. Be careful not to fall into the same trap again. Just because your credit cards have been repaid through consolidation doesn’t mean you should go spending what you don’t have. If you still find it difficult to budget your credit payments so that you are not incurring debt consider switching to a debit card. They offer similar benefits but only let you spend the money you have.
If you would like to experience the relief of consolidating your credit card debt into one easy to manage repayment, then give us a call, or request a debt assessment. Our trained advisers can help yo choose a plan that is right for you, and will help you get debt free!