There may come a point in your life when you realize you’ve taken on more debt than you would like. While this is a part of life for most people, it doesn’t mean you want to swim in debt for many years to come. At some point, sooner rather than later, you want to break the mold so you can have more financial freedom.
There are many benefits of consolidating your debt. In addition to saving money, it allows you to more easily manage and organize your debt. And with that, there’s less stress bogging you down.
This leads to an important question: what’s the best way to consolidate debt?
While there is no right or wrong answer, there are several options for you to consider. Here are three of the best:
- Balance transfer credit card: This is one of the best options if you have more than one credit card balance. With this type of credit card, you can bring your debt under the same roof. Best yet, these credit cards typically offer a zero percent introductory rate for 12 to 18 months. This gives you an extended period of time to pay down or pay off your debt without any concern about finance charges.
- Personal loan: If you’re dealing with many different types of debt, such as credit card debt and a home equity line of credit, you can use a personal loan to consolidate it. The benefit of this is that you can consolidate more than one type of debt. And when you do this, you’re left with one easy to manage monthly payment. Also, personal loans are typically approved or denied quickly, often within 24 hours.
- Home equity loan: This is similar to a personal loan in the way that you can use it to consolidate many different types of debt. But as the name suggests, you’re tapping into the equity in your home to borrow the money you need. Since it’s a secured loan, your home is at risk if you default. However, since you’re willing to put up collateral, you should be able to secure a lower interest rate than with a personal loan.
If you’re interested in consolidating your debt, learn more about the pros and cons of the three options above. For speed and efficiency, a balance transfer credit card or personal loan is best. But if you want the lowest rate on a loan, a home equity loan is the way to go.
A large debt load has the potential to cause a lot of stress in your life. Not to mention the fact that it can impact your ability to manage your finances in the intended manner.
If you’re tired of dealing with many different types of debt, it’s time to consolidate it. Through one of the options above, you’ll find yourself feeling better about your situation and realizing that your financial future is bright.