June 29, 2022

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How To Know When It’s The Right Time To Consolidate Your Debt

2 min read

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Getting out of debt is usually a much harder thing to do than getting into debt, especially if you end up with a large balance and a high interest rate which makes it feel like it’ll take over a decade to pay off. As a result, many people turn to debt consolidation loans to help pay off their balance faster.

There are many advantages — as well as a few caveats — to keep in mind if you’re considering consolidating your debt. Of course, everyone’s situation is different so you should always double check with a financial advisor to ensure your unique personal needs are being met before making your next move.

Below, Select breaks down a few circumstances that indicate when consolidating your debt would be a good step for you to take.

You have multiple monthly debt payments

Consolidation quite literally means combining several things into a single more coherent whole — debt consolidation, therefore, is the process of taking multiple monthly debt payments and replacing them with one monthly payment.

If you have several major bills that need to be paid monthly, consider this the first sign that debt consolidation could be a good next step for you. Consolidating multiple payments into just one can help you feel more financially organized and less stressed about having to divvy up your paycheck to pay them off.

Let’s say you take out a debt consolidation loan — that means you would apply for a specific amount of money and once approved, the lender would send the funds to your creditors and pay off those balances. In other words, the only monthly payment you’d be making is for the loan itself.

Some personal loan lenders, like Payoff, for example, offer personal loans as low as $5,000 and as high as $40,000 that are meant…

2022-04-02 09:30:00

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