Deciding between a balance transfer credit card and a debt consolidation loan depends on the terms you get, the repayment plan, and your comfort with risk. A balance transfer credit card is a great option if you can get a 0% introductory APR, AND you can pay off the balance before the period expires. A debt consolidation loan might be better if you need a more extended period to pay off the debt.
So, when thinking about debt consolidation, you need to think about these things:
1. Are you just kicking debt down the road? Meaning ae you paying off debt by taking out more debt? You have to lower your spending and be committed to not accruing more debt as you work on paying off
your debt.
2. If you have a low credit score, you probably won't be able to get a lower interest rate on the balance transfer or debt consolidation loan. So, first focus on making on-time payments, paying off debt, and increasing your credit score.
3. make sure you have a budget and have found a way for that budget to work successfully in your life.
Now, of course, I always recommend paying off your debt by buckling down, controlling your spending, and learning about why you are debt in the first place. Addressing and understanding why you go into
debt is critical if you want to make changes to stay out of debt in the future.
That said, when you are facing financial hardship, sometimes debt consolidation can help when you have high-interest debt that is not manageable.
CHAPTERS
Intro: 00:00
What is debt consolidation: 00:54
The benefits: 01:45
How to consolidate your debt: 03:23
Things to consider: 09:55
?? SHOULD YOU CONSOLIDATE YOUR DEBT: https://bit.ly/3e69JAv
?? SHOULD YOU CONSOLIDATE STUDENT LOANS: https://bit.ly/3oy9xPw
?? FINDING YOUR WHY: https://bit.ly/3aJUryj
?? THE BUDGET MOM’S FINANCIAL FREEDOM STEPS: https://bit.ly/3cfJXsp
?? HOW TO GET STARTED WITH THE CASH ENVELOPE METHOD: https://bit.ly/2vQJaO5
?? HOW TO CREATE A PLAN OF ATTACK TO PAY OFF DEBT: https://bit.ly/2wDETxF
ABOUT ME
I’m the blogger behind https://www.thebudgetmom.com. I have a rambunctious 6-year-old son, live in Washington, and I’m passionate about helping people with money management and personal finance. Let me know what you like to learn more about! Leave me comments and suggestions on my video and let me know!
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Due to the pandemic that happen, I lost my job and I had less funds on me, so I borrowed about 5 grands from my credit card company and Thanks to Official_donald_fx_ on insta I paid all of the debts through him
What a Genius Mr Donald @ Official_donald_fx_ on Instagram is, I have heard of him from many of my friends, but now when i needed to pay my credit card debts, I was very much fortunate cause he cleared them all. SUCH A PRO.
Thank you for the helpful tips.
I consolidated 27k of high interest credit card debt (19.99% – 29.99%) into a personal loan at 7%. One thing to note is that if you don't own your house it is HHAARRDD to get3 approved. I had to work with my bank for 2 months before they finally approved me because I have no equity
I’m excited to say I just paid off my line of credit this past Friday!!!! What a great feeling!! Now onto my only other debt (other than my mortgage) ..my car loan.
Budgetmom, i would have included the positive psychological effect of when one card gets paid off by your own means rather than having the debt being one huge debt that feels like it takes longer to pay off
Thanks for that. Im in south africa and looking after 7 kids that is not mine. My life was turned upside down as theý are family kids. With one income its very hard as south africa salaties are not the best. I wish i could afford your workbook. Ive been watching you for the past year and love your advice. Especially when you bought your home. I cried. Wish i could give my kids that g?ft of a home. Bless you.
Can you do this with student loans combined with credit card and bank loans?
I have a serious issue with money management and compulsive spending. In the last 4 years I have done 3 personal loans to consolidate my debt & then charged up two credit cards after. So I have accumulated so much more debt. I keep kicking my debt down the road… I cannot seem to get it under control & I hate myself for it ????
Really great video