Posts Tagged ‘quick debt consolidation’

Need to Fix Your Finances Quick? Debt Consolidation Might be the Answer!

When your finances  need some TLC, a quick debt consolidation review could provide some options!  Part of balancing your budget includes finding ways to limit expenses and outward cash flow while also limiting costs.  Debt consolidation isn’t for everybody, but in many cases it can help lower monthly payments while also lowering the total cost of that debt.  Here are a couple of things you can do to determine if debt consolidation is right for you.

Organize Your Financial Life

Put together a list of all monthly income and expense items.  Make two columns.  In the first column, list your income items, added up monthly.  In the second column list your expense items for the month.  Add up the totals of each column and you will see a high level picture of your cash inflow and outflow for each month.  This will give you an idea of your overall monthly financial health.  If your expenses are more than your income, you now can see  where you may be able to either add income or reduce expenses.  There are a number of ways to accomplish both, and that is really outside the scope of this particular post.  That being said, there is one method for reducing expenses, and it can be quick: debt consolidation.

To Consolidate or Not to Consolidate – The Snapshot

Debt consolidation is not for everyone, in fact, depending on the method chosen, some households are better off keeping debt separate and paying off accounts one by one.  How do you know which of these households you fall into?  Well the good news is we can do a quick check that will help you determine if you should start down the road of consolidation.  In your favorite spreadsheet application enter all of your debt accounts.  Enter these in multiple columns.  The columns should be as follows:  account name, balance, interest rate, monthly payment, term (total payments, i.e. 360 for 30 years of monthly payments), payments left, and total paid.  Enter all of your account information and at the bottom add up all of the monthly payments, this will be your monthly obligation for all debts.  Also add the balances up to show you your total outstanding obligations.  In the total paid column, you will add a formula multiplying the monthly payment in each row by the total payments in each row.  This will show you how much money you will pay over the life of the obligation.  This will give you a present day look at your monthly costs as well as what you will pay over the life of all obligations.  Now you have a snapshot of your overall debt scenario.

You Have Options

Whether or not you need a quick debt consolidation solution, you have options.  There are multiple ways to consolidate, some you can do on your own, and others can be provided by financial services companies.  The next post will discuss these in more detail.