Debt advice needed

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  • This topic has 4 replies, 2 voices, and was last updated 11 months ago by Awoodmckay.
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  • Awoodmckay
    June 27, 2023 at 6:50 am #1123473

    So I have 2 credit cards and 1 loan currently that I’m paying off monthly.

    The credit cards were 0% interest for a period of time but now I’m paying interest on both cards and have always paid interest on the loan.

    How do I consolidate these debts so that I’m not paying so much interest.

    Would I be better off taking out a loan for the total outstanding across all 3 so that I’m only paying 1 monthly payment? Do I get another interest free card and do a balance transfer?

    My credit rating is excellent as I’ve always made at least the minimum payments, however I’ve racked up almost 10k on the credit cards combined and have about 3.5k left to pay on my loan.

    Any advice would be welcomed. Thanks.

    June 27, 2023 at 7:53 am #1123474

    Go speak to financial advisor at your bank. Sure, putting it all in a 0% interest card will temporarily help you, but you have to pay it all down before you’re hit with interest again.

    June 27, 2023 at 8:51 am #1123475

    I would absolutely not switch over to another credit card unless you know you can pay the balance off before the 0% is up. So, you’d have about six months?

    Take this with a grain of salt, but I was in some Credit Card debt about 10 years ago. About $17k. I was able to pay off in two years. I now have no debt. I aggressively paid down the highest interest Cc first and did the minimum payments on the other. Then kept that up until all was paid off.

    So, if your loan is low interest, concentrate on the CC debt and pay the min on the loan. CC’s usually have higher interest.

    Oh, and as soon as that 0% is over on a new CC – the interest shoots up a lot. Which is why I don’t recommend unless you know you can pay it all off.

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    June 27, 2023 at 12:26 pm #1123484

    Definitely go see a financial advisor at your bank. It’s a free appointment.

    If you have good credit, you should be able to quality for a consolidation loan; a low-interest, non-revolving line of credit that you can use to pay off the other loans. Or perhaps the expert will have another suggestion.

    If you find you’re accumulating debt monthly, sit down and work out a budget, with an expert if need be. Eliminate or trim down your non-essential expenses until you’re living within your means. Look at things like subscription services that suck money monthly without you really noticing (multiple steaming services? Amazon prime?). Find ways to make your essential expenses cheaper (ie groceries – switching stores, making meal plans around sales, no brand names – downgrading your phone plan, switching your internet provider). Cut up your credit cards or just keep one in case of emergency and freeze it in a block of ice in your freezer so you can’t use it on an impulse.

    Good luck.

    June 28, 2023 at 1:40 am #1123489

    Thanks for your responses. I’ll definitely book an appointment with a financial advisor.

    I love the idea of freezing my main credit card in a block of ice however it doesn’t help that I know all the details by heart!

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