KEY TAKEAWAYS
✔ Turn multiple debts with different interest rates into one manageable payment.
✔ Debt consolidation is common and a good solution when it results in overall savings.
✔ Eliminate the guesswork by using a debt consolidation calculator to see if the option is right for you.
If you’ve ever rented an apartment that included utilities, or gone on an all-inclusive vacation with friends, you get the idea of having all your expenses covered in a single lump-sum payment. The idea of paying one amount, on a schedule that suits you, can be convenient and can take care of all the costs at once instead of having to pay each expense separately.
How debt consolidation works
Debt consolidation is a common solution that allows you to pay off bills or expenses that have high interest rates by taking out a loan for the total amount you owe. Here’s a snapshot of how it works.
The result is one loan, with one regular payment (weekly, biweekly or monthly), depending on the terms of the loan. The benefits of a debt consolidation loan are:
- You can better manage your payments with one set amount.
- One amount helps to ensure every payment is on time.
- With every on-time payment, you can improve your credit rating.
Show me the money: a debt consolidation example
This chart helps to explain how easy it is and how much you can save by taking three credit card debts and consolidating them into one easy payment system.
In this example, you would have saved $1,605.64 in interest over a four-year term by consolidating three higher-interest credit card balances onto one debt consolidation loan. You could even use your savings to invest in yourself and get payback with a better paycheque.
Is debt consolidation right for you?
In just a few minutes, you can find out how much money you could be saving with a debt consolidation loan. Try this easy-to-use debt consolidation calculator.
To find out more about debt consolidation loans, visit your local easyfinancial branch or visit our site and see how easy it is to customize your solution and get approved in minutes.
Disclaimer: This content is intended for informational purposes only and does not constitute financial advice on any subject matter.
