Why It's A Great Time To Think About Consolidating Your High-Interest Plastic Debt
- 4 years ago
It's never a good idea to take on high-interest debt just because it's cheaper than it used to be.
However, if you have a strong credit score and you're trying to pay off credit card debt, it might be smart to consolidate it.
Business Insider reports the 'spread' between interest rates on credit cards and personal loans hit an all-time high during the first quarter of 2020.
Put simply, that means there's never been greater potential for saving money on interest.
Personal loans used to pay off credit card balances allow you to make fixed payments, at a fixed interest rate, for a fixed repayment period.
Borrowers with credit card debt paid an average of 16.62% in the first three months of the year.
Meanwhile, the average rate on personal loans for the same period was 9.63%. That's a difference of nearly seven percentage points.
However, if you have a strong credit score and you're trying to pay off credit card debt, it might be smart to consolidate it.
Business Insider reports the 'spread' between interest rates on credit cards and personal loans hit an all-time high during the first quarter of 2020.
Put simply, that means there's never been greater potential for saving money on interest.
Personal loans used to pay off credit card balances allow you to make fixed payments, at a fixed interest rate, for a fixed repayment period.
Borrowers with credit card debt paid an average of 16.62% in the first three months of the year.
Meanwhile, the average rate on personal loans for the same period was 9.63%. That's a difference of nearly seven percentage points.