Debt consolidation aims to combine debt from multiple creditors by taking out a single loan to pay them all, at a reduced interest rate with lower monthly payments.
This is typically done by consumers trying to eliminate numerous payments and budget easier.
There are many different avenues one can take to help eliminate debt from bankruptcy to consolidation, figuring out the best way to budget your finances for your family can be a daunting task.
Debt Consolidation Loans ~ Consolidate multiple loans into one monthly payment
Debt Settlement ~ Take steps to negotiate your repayment terms
Credit Counseling ~ Speak to qualified credit experts, learn debt reduction strategies, and more
*When you consolidate your credit card debt, you are taking out a new loan. You have to repay the new loan just like any other loan. … If you have multiple credit card accounts or loans, consolidation may be a way to simplify or lower payments. But, a debt consolidation loan does not erase your debt.
Simple tips to stay on budget once you have consolidated all your debt.
Set a budget that allows you to live within your means and stick to it: Take the time to sit down and write out all your bills, whats necessity and what is not. Focus on the necessity and work in the other as financially available.
Avoid impulse purchases: This one is the hardest for me as I am constantly seeing great deals and have this horrible feeling of what if I miss out. This is a big part of consumer debt in America. I had to retrain my brain to think, so what if I do. What good is it sitting on a shelf, just because it was a good deal.
Shop around for the lowest price before making a big purchase: this is the easiest one for me. I never make a big purchase without checking other sites, brands and deals. You will be surprised as how much you can save simply by checking a different site.
Pay off credit card balances each month to avoid extra interest charges.
Two of the most important tips to staying in budget would be to keep your finances organized and check your balances often, the second would be to set aside a certain percentage of your income into savings of some kind to help eliminate the need for emergency credit purchases.