College is stressful enough without the worry of how and when you’re going to be able to pay for it. For so many people pursuing higher education, the only thing they can really do is bite the bullet and take out student loans. It’s a harsh reality, but unfortunately it’s the reality that they’re faced with.
Fortunately, there are ways to lessen the load, or at least quell the stress of amassing that much debt. If you’re one of those people that had to take out a sizable amount of loans, debt consolidation is a worthwhile option when it comes to getting it under control, and for those unfamiliar with it, here’s why:
Better Interest Rates
Accruing debt is easy, especially as credit cards and loans become more accessible. If you’ve had to take out loans or get a couple cards, it’s easy to get behind on payments and therefore buried in interest rates if you aren’t careful. Luckily debt consolidation can help make the burden a little more bearable.
Rather than having to pay on 3 different credit cards with 3 different interest rates, debt consolidation only requires you to pay on one loan with one interest rate. Essentially, once you consolidate your debts, you start saving money almost immediately, especially if you have multiple credit cards or other outstanding charges.
Lower Monthly Payments
Much like your interest rates, once you have consolidated your debts, your monthly payments will decrease as well. Since all of your debts will technically be in one big pot, you won’t have multiple debts adding up every month, creating a financial hole you have to try and dig yourself out of with every paycheck.
Instead, you’ll have one payment to make, which will not only be considerably lower, but much more manageable when all your other bills start rolling in. By having all your debts in one place, meeting your payment deadlines will be much easier to remember, thus giving you an opportunity to get better control of your finances.
More Time to Pay
When it comes to paying off your debts, it seems like time is always working against you. Not only is there the pressure of having to meet your deadlines on time, there’s also the ever-growing amount of interest accumulating a little bit more every day. It’s an uneasy feeling to say the least, but luckily for you, it doesn’t have to be this way.
Of the many things that debt consolidation affords you, some extra time to pay off your debts is one of the most important. Rather than having to keep track of multiple payment deadlines, you’ll have only one to worry about. This not only makes it easier to pay on time, but also lets you to build up your credit score over a longer period of time, thus creating better financial stability for you in the future.
As you can see, consolidating your debts is beneficial in myriad ways. It may be a big step financially, but it’s definitely a step in the right direction. And if debt consolidation is something you’re interested in, but you’re still a little wary, consult a banker or financial advisor and they will be able to help guide you through the process.