Once again, it’s tax time in the USA, and even though you’re digging through all of your receipts, statements, and paperwork from last year, it’s never too early to start thinking about this year! If you’re like most people, as you go through all those papers, you’re looking at what you spent on things like groceries, electronics, utilities, and credit cards, and it can get pretty depressing. You look at all those payments, and you start thinking that it’s really hard to ever get ahead when you’re paying so much interest every month. You wonder if you’ll ever get everything paid off so you can relax and maybe even have a little bit of money left over in your budget at the end of each month.
First and foremost, if you ever want to get them paid off, you’ve got to stop using them! Gather up all your credit cards, take them out of your wallet or purse, and put them away. That’s right, put them away. Put them in a box, file, or on a shelf, but don’t carry them around any more. If you don’t have them with you, you won’t be able to use them for those impulse buys! And, chances are, if you have to go home to get one of your credit cards, you won’t go back to the store and use it.
Secondly, you’ve got to make a plan to pay off the bills that you already have, and you have a couple of options to accomplish this. You can utilize money you have in savings, you can consider balance transfer options with introductory rates, or you can take out a personal loan. All three of these options have both pros and cons – using your savings can eat up the cash that you have on hand, and should you have an emergency expense later on, you’ll end up having to use a credit card to pay that expense. Taking advantage of a balance transfer option on a new or existing card is a great option as long as you are able to pay the balance off within the allotted time frame – if not, you’ll face a huge interest charge when the introductory period ends. And finally, taking out a personal loan does involve interest charges, but typically those interest rates are less than credit card interest rates, so you do save in the end.
Which option is for you? While the balance transfer is a good option for those who don’t have much credit card debt to pay off, when you need to consolidate a lot of credit card debt, a personal loan is usually the easiest way to pay off everything, lower your monthly payments, and still keep your emergency cash in savings.
Think a personal loan is the right choice for your financial situation? Take a look at these lenders and see if one fits the bill: