Millions of Americans are in debt. Maybe you are one of them. The ease with which credit cards, lines of credit and loans can be obtained puts crowds of consumers at risk of overspending, underpaying and winding up in the red.
“If you need help getting out of debt, you are not alone,” Debt.org states. “Although signs show an upturn in the economy, many Americans are deep in debt, and not everyone can work overtime or a second job to pay down that debt.”
Enter debt consolidation. Debt consolidation works by combining bills that are owed, whether they are college-, medical- or property-related, and combining them into a single bill to be paid off with a single loan. So instead of making three, four or even five payments per month, which can be difficult to manage and financially taxing, one payment is made. “This helps eliminate mistakes that result in penalties like incorrect amount or late payments,” Debt.org states.
As the first day of Fall has arrived, now is the perfect time to make a move in the debt-consolidation direction. Not only will you lower your interest rates and monthly payments, you also will be able to see the light at the end of the tunnel and a clear path to debt freedom. Bonus: Your credit score will improve, too.
For help with your credit, click here.
Industry experts favor a method referred to as a debt-management plan as the best way to go about the task. They often are offered by nonprofit organizations such as Clearpoint Credit Counseling Solutions. Consumers set up an appointment with one of the trained staff members to discuss incoming and outgoing cash flow and how much safely can be paid out on a month-to-month basis.
“We work toward a mission of Consumer Health through Financial Education, which means that we want to teach consumers how to make educated financial decisions and turn their lives around,” Clearpoint Credit Counseling Solutions’ Web site states. “Our vision is to transform people’s lives by guiding them toward financial dignity, self-determination and long-term economic success.”
Another method used to pay down debt is a debt-consolidation loan. Unlike a debt-management plan, a debt-consolidation loan is obtained through a private lender and can be in the form of a personal loan, a home-equity loan or a transfer of balances from credit cards with high-interest rates to credit cards with low- or zero-interest rates. The good news for those millions of Americans is there are options out there to help them shed their debt.