How to cut your holiday debt

The holidays are an expensive time for many. actually, A new survey During the most recent Christmas season, the average American showed nearly $1,550 in debt.

That’s 24% more than a year ago and the highest holiday debt burden in at least eight years.

Fortunately, if you’re one of the many who took out a loan to brighten the season, there are ways to deal with it.

How to cut your holiday debt

Here are four options for dealing with holiday debt (and, often, even reducing your expenses for it).

1. Get a debt consolidation loan

Debt Consolidation Loans is one of a kind personal loan which you use to pay off other debts. It sounds a little counterintuitive, but since these loans have much lower interest rates than credit cards, this strategy can usually save you quite a bit on interest in the long run.

Here’s an example: Say you have $4,000 on a credit card with an 18% rate. If you are a Debt Consolidation Loans At 9% and use that money to pay off your credit cards, you’ve essentially cut your interest rate in half. Depending on how long you take to pay off the loan, this could save you thousands in interest over time.

You can get a free savings estimate online now to see exactly how much a debt consolidation loan could save you.

2. Borrow against your home equity

If you’re a homeowner, taking out a loan against your home equity can be a low-cost way to manage debt. These loans have much lower interest rates than credit cards (and personal loans, for that matter), allowing you to save more in the long run.

There are many options, too. there Cash-out refinancingwhich gives you a larger loan instead of your current mortgage loan, Paying you back the difference in cash. You can easily explore your cash-out refinancing options here to see exactly what you’ll qualify for.

And for seniors, there is Reverse mortgage. They work backwards, with the lender paying you out of your home equity instead of paying you.

You can also get a home equity loan, which gives you a lump sum that you can use for those loans, or you can choose a home equity line of credit (HELOC). They work like a credit card and allow you to withdraw only the money you need.

3. Withdraw money from your life insurance

Another option is Withdraw money from your life insurance policy If you have one. This is only possible with permanent life insurance policies, ie Whole life insurance or Universal life insurance. Term life insurance policy will not offer cash withdrawal option.

If you decide to cash out your policy, remember that it will reduce its value, as well as the payout your loved ones will receive when you’re gone.

Get a free life insurance estimate online now to learn more.

4. Get a balance transfer credit card

Balance Transfer Card Could be an option, too. These cards usually come with promotional interest rates (often 0%) for a limited time. Once you have one, you can transfer your various credit card balances to it and enjoy interest-free payments for one or sometimes two years.

Just be sure and pay off the balance before that rate expires, as it can jump significantly once it does. You should also be aware of any transfer fees for card charges. This can sometimes be up to 5% of your transferred balance.

There are many ways to get out of debt

If put on the shelf Credit card debt When it comes to vacations, you have options. In addition to the techniques described above, there are also credit counseling agencies that can help. You can contact a financial professional for personalized loan assistance and budgeting guidance.

found A free savings estimate Online today to see if a debt consolidation works for you.