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How To: Consolidate Debt
From holiday shopping to vacations to home improvements, without proper budgeting it’s not difficult to find yourself in serious debt. Here are the benefits of using a personal loan to better manage a tough financial situation.
From life’s milestones to those unexpected bumps in the road, it all costs money. No matter how hard you try, you just can’t plan for everything life sends your way.
Being submersed in debt can feel like being stuck in a black hole. Climbing out of that hole isn’t easy, but if done with intention, it can be a predictor for lasting financial success.
Why should you consider consolidating debt?
- Lower Interest Rate – especially with high-interest credit card debt, the interest rate on a personal loan could be considerably lower than what you’re currently paying.
- Lower Payments – increase your cash flow by lowering your payments. Keep in mind the reason this is possible is because you’ll be extending your term, not because there is less debt.
- Single Payment – eliminate the stress of having multiple monthly payments by consolidating your debt into one new loan.
- Improve your Credit Score – fewer bills to pay means you’re less likely to have a late payment. Over time, as you pay off your debt, your capacity increases which is a significant component of your credit score.
Your ultimate goal should be to pay off your outstanding balances. Take a close look at what caused your debt to build up in the first place. Are you spending more than you earn? You may need to spend less, or increase your income.
Look at your spending, understand why you’re in debt, and begin budgeting. Stick to the adjustments you make to your spending habits even after your last repayment is made, and you’ll be well on your way to reaching your savings goals.
Pay yourself first. Putting money in your savings account via payroll or automatic transfers ensures you have money set aside for those unexpected bumps and your access to easy money for impulse buys will decrease.
Consolidating Debt with Mill City Credit Union
Mill City CU offers three convenient options when applying for a personal loan.
- Loan Application. Using our mobile + online loan application, you can apply 24/7 from wherever you are. We’ll even approve you for the loan in minutes if you qualify.
- Over the Phone. Our Member Connections Representatives are trained to take your application Monday – Friday from 7:00am-5:00pm CST. Just call them at 800-284-6328.
- In Person. You can always stop by one of our branch offices and meet with us personally.
If you would like to discuss options before applying, simply call Member Connections at 800-284-6328. You’ll be connected with someone that can help assess your personal situation. At any time, members are encouraged to sign up for a FREE Financial Review.
If you think consolidating might be right for you, Mill City is currently holding our annual Super Sale until December 31st, 2017. Our Super Sale offers a lower than usual rate for personal loans – perfect for consolidating debt.