Is debt keeping you up at night? When you’re raising a young family, debt can pile up faster than the dirty laundry basket. But consolidating your debt doesn’t have to be a complicated equation.
While debt can add up to an exponential amount of stress, there are viable solutions to help ease your debt load.
By switching your balances from multiple debt sources to one line of credit or low interest loan, you’ll save time, money and energy - all in one convenient place. The goal is to move your financial dial in a sustainable direction.
How quickly would you like to reduce or eliminate your debt?
Create a list of your current debts and corresponding goals for repayment. This will help you visualize how to connect point A (your current debt picture) to point B (your financial happy place). When you consolidate your balances into a line of credit or low interest loan, you’ll have the ability to pay off debt faster. This puts financial freedom for you and your family within closer reach.
By transitioning to a single monthly payment, you’ll streamline your finances. Consider a term loan to help support the goal of paying down debt. Term loans feature lower interest rates than credit cards. In exchange for a lower interest rate, be mindful that you are committing to a fixed monthly debt payment.
By paying off smaller credit card balances, you’ll lower your utilization rate, which improves your overall credit score. Keeping your accounts open with their original credit limit and a zero balance will help support your credit rating - as long as you avoid using them.
Like many families, the mortgage on your home is your largest single investment. Owning a home can mean using your home’s equity for debt consolidation. When you leverage your home, property or car equity, you could be eligible for a further reduction in interest rates.
Debt consolidation doesn’t equate to smarter spending. If you continuously spend beyond your means, consolidating your debt is only one side of the solution. Once you consolidate your debt, the key is to avoid accumulating new debt. Keep your balances under control by adhering to your budget.
At Sunshine Coast Credit Union, our team of expert Financial Advisors can help customize the best borrowing plan for your needs. Let us support you in minimizing and lifting the weight of ongoing debt.
These articles are made available to you as tools for independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy. All examples are hypothetical and are for illustrative purposes only. Please visit your branch to seek personalized advice from qualified professionals for all personal finance issues.