Achieving financial security is a goal for many Americans, and for good reason – most people have some kind of debt in the form of a mortgage, student loans, or credit card bills. It can be quite difficult to attain stability if you have mounds of debt, as interest and other life expenses can conspire to put you further and further in the red. According to NASDAQ, the United States has racked up over $884 billion of outstanding credit card debt as of January 2015 and, if you among the 183 million Americans who are cardholders, this could be holding you back from financial security.
In fact, the average household has $16,140 of credit card debt, according to current data. Keep in mind that is just the average – there are plenty of Americans who have much more debt than that. Credit cards can be a major roadblock for those who are trying to become financially secure, as these accounts often come with high interest rates that make them hard to pay off. While there are plenty of factors that determine credit card interest rates, the average fixed interest rate is 13.1% and the average variable interest rate is 15.73%.
Before we delve into a solution to this problem, let’s use the figures above to provide an example of just how long it could take you to pay off $16,140 in credit card debt. Using the fixed interest rate of 13.1% and a minimum of $200 a month payment on $16,140 (without any new charges), it’ll take you 195 months of payments (over 16 years) to pay the card off. Guess how much that’ll end up costing you in the long run? $39,000! That’s more than double the original amount! Are you ready to get your financial freedom back with one simple solution?
Most Americans have more than two credit cards and the more you have, the more difficult it can be to manage the balances since they all come with different interest rates and due dates. Thankfully, it’s possible to bundle all of those credit cards into one single monthly payment with a low interest rate by opting for a debt consolidation loan. This type of loan can simplify credit card debt and cut your interest rates in half (or more), which would immediately reduce your financial burden. This, of course, would make it much easier to obtain financial security because you’d be able to pay down your debt faster and finally see your savings grow.
Additionally, when you establish a firmer financial footing, you can use long-term strategies to stay out of debt and in the green. Start taking control of your finances today with a debt consolidation loan from Broadstar Financial Group!