Is One Payment More Convenient?

Most people  use debt consolidation for the convenience of one repayment, but is one repayment actually more convenient?

The average saving on a $10,000.00 credit card, when consolidated into a personal loan, is only $5.00 per month, over 7 years.  This means debt consolidation doesn’t provide much of an improvement in cash flow.  The question you’ve got to ask yourself is, “is it going to be easier for me to find one large payment or lots of little payments?”

You may be able to find a spare $20.00 here and there to make a payment on your credit cards, but it may be a lot harder to find $100.00 to make a payment on your debt consolidation loan.

You’ve also lost the ability to negotiate with a large number of creditors.  You might be able to call one creditor and get them to push back your payment for a week, but you can’t do that now that you’ve only got one creditor.

For many debt consolidation is a good idea, but you need to think about the reality of the situation.