If you are unable to pay at least three times the minimum monthly payments on your high-interest loans each month, you should consider consolidating your debt.
Many people incorrectly assume that paying the minimum monthly balance to their high-interest loans (such as credit cards) will get them out of debt. Unfortunately, this is not the case. In fact, if you had only $1,000 in credit card debt it would take you over 26 years to pay off that loan if you stuck to the minimum payments. That $1,000 would cost you over $4,000 by the time you pay it off.
Nobody wants to pay four times what something is worth, but in order to avoid these interest charges you need to either pay much more than the minimum payment, or consolidate the debt.
Debt consolidation companies work with your creditors to lower your balance and the interest rate, which implies that your minimum monthly payment is lowered as well. However, don't fall into the trap of only paying that minimum monthly payment! Instead, take advantage of the opportunity to pay three or four times your new minimum balance.
Still not sure if debt consolidation is right for you? The good news is that the internet makes it easier than ever to talk with an expert about your situation. For more information, visit LowerMyBills.com for a free, no-obligation debt consultation.
