Shortage of personal finance: consider debt consolidation to become debt-free quickly

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Overburdened with debt? If so, you are running short of personal finance and not prepared for emergencies. According to a report by Bankrate.com, more than 70 percent of US citizens fall short of emergency savings due to loans and credit card debts.

In fact, 23 percent of Americans have a dearth of emergency funds, and 22 percent of them have less than 90 days’ worth of everyday expenditures.

All such information proves that multiple loans will adversely affect your finances.

When you have more than one loan while coping with a poor credit score, managing your household expenses seem a grueling task under such circumstances.

So what are you supposed to do? You need to improve your personal finance. The best way to deal with the situation is paying off your loans through debt consolidation.

As far as consolidation is concerned, you can clear your debts quickly and with negotiation skills, you could even manage to shell out less in terms of the total amount payable.

Refinancing is the best solution if you have too many debts, and want to improve your financial situation. Consolidate all your loans into a personal one and make regular monthly payments to become debt-free.

However, you must shop around for consolidated loans. According to another article published on huffingtonpost.com, people with debts must look for a consolidated loan offering minimum interest rates throughout the loan period and lowest monthly payment. To make your job a tad easier, here are a few tips for debt consolidation:

Avoid Making Minimum Payments

Making just the minimum payment is a common practice among borrowers. For example, if you have a medical loan and which last for about 20 long years, avoid making minimum payments.

Shell out more than just the minimum amount. Make sure you don’t use your credit card for shopping provided you have the financial ability to pay back the full sum of money before the due date.

Try to make credit card payments on time to improve your credit report. Avoid listening to people who say that you should have some balance on your card for a healthy credit score.

Did you know that the money people owe on loans and credit card debts contribute to approximately 30 percent of their credit score?

Therefore, pay more than the minimum amount so that you can pay less interest over the years and clear your dues faster. When you pay more, you need to…
 
Continue reading the article and learn more about debt consolidation on Vertextra.com.
 
 

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