Carrying debt is like carrying a boulder up a hill. It weighs you down, not just financially, but emotionally too. It gets in the way of you living your life and achieving your dreams.
There are numerous tools you can use to get out of debt. One of them is a Debt Consolidation Program, in which multiple debts are consolidated into one lower monthly payment, along with reduced or stopped interest. You only pay one monthly payment and you save money on interest charges.
When you seek out debt consolidation in Canada, working with a non-profit credit counselling agency that takes a holistic approach to your finances helps a lot. Their assessments and solutions take into account:
- Your income and expenses,
- Interest rates on your debts,
- Current debt payments
- And building a monthly budget to help make payments.
You can find more information on Creditcanada.com about how you can take steps toward paying off debt.
A Debt Consolidation Program can help get you out of the red sooner, but what happens once you’re finally free?
#1 More Savings
Relying on credit creates a trap, where if you carry a balance from one month to the next, you start getting hit with interest charges. Ultimately, interest charges inflate the price you pay for everything. So, while using a credit card can stretch your monthly budget one month, carrying that debt reduces your purchasing power until it’s paid off.
Going debt-free means you don’t have debt payments to make every month. That money can go into savings instead. You can put some of that money toward building emergency savings. Emergency savings help you from going into debt even when income loss or surprise expenses wreck your budget.
#2 Your Credit Score Improves
You need to use credit to see your credit score improve, but if you pay off the full balance on your cards every month, you get the best of both worlds: a higher credit score and no interest payments. When you have a higher credit score, there are several perks you can enjoy:
- Better interest rates on mortgages and car loans,
- Better insurance rates,
- Better chances of securing an apartment or a loan.
#3 You Appreciate Your Money’s Worth
Debt helps us buy things we can’t afford. It can quickly become a problem when we do this over and over, stretching a budget with money we don’t have. That can make it extremely hard to catch up on debts. When you live life without debt, you’re saving for your purchases, vacations, etc. with cash before you buy it. Saving up to afford something special will give you a greater appreciation for the money you earn, and might have you re-thinking big purchases. You’re going to start spending your money on the things that really make you happy.
If you want your life to look more like the above, it’s time to get serious about getting rid of your debt. A Debt Consolidation Program can simplify your monthly payments and significantly reduce the interest charges you face.