No debt problems are unsolvable. It might not be easy or quick, but there’s always a way out of it. And the earlier you deal with them; easier they are to deal with.

Of course, debt consolidation is not the only way to get out of debt. Another common way out is debt management. These two terms are often mixed up, because many companies advertise both debt management and debt consolidation.

Debt consolidation only refers to getting a new loan that pays off your old debts and gives you one payment. If you decide to do debt management, it’s best to use a certified credit counselor. It is challenging to compare each debt relief option side-by-side, since each solution is unique.

Some debt relief options require taking out a loan, some require home ownership, and some are very aggressive and designed only for consumers with serious financial hardship. We compare the different debt relief options and put everything on the table, so that you have the information you need to make the best decision for your own needs. If you do your homework, then you can find the right debt relief solution for your unique financial situation. You should only do debt management if you are having trouble paying your current bills and need a reduction in monthly payments to be able to do so.

If you need help learning to manage your money and want to enroll in a credit counseling program, you can always get credit counseling – whether you decide to do debt management. Becoming a well informed and knowledgeable consumer is everyone’s responsibility. Traditional debt help says, ‘never borrow your way out of a debt problem’. But this ignores the varying cost of different debts. So, know to differentiate your need and wish.

If your debt problems, seem insurmountable – we can help.

Right Choice Debt Solutions is a team of professionals with experience and knowledge to help you get out of debt. During your consultation, we will help you understand what your current financial situation is, and how to move on to a better life

Following steps may be helpful towards financial freedom:

1. Identify your debts
2. Review your budget
3. Make on a strategy
4. Consolidate your debts
5. Stay away from taking on more debt
6. Know where to get help

Identify your debts

List out all your debts. Your list may include:

• mortgages
• car loans
• credit card balances
• line of credit balances
• payday loans
• taxes you owe
• buy now, pay later balances
• unpaid utility bills (cell phone, hydro, cable, etc.)
• student loans
• loans from friends and family
• spousal support and/or child support you owe

For each item in the list, identify

• the total amount owed
• the minimum monthly payment you are making and
• the interest rate

Review your budget

A budget is a plan that helps you manage your money. It will help you:

• figure out how much money you get, spend, and save
• balance your income with your regular expenses
• guide your spending to help you reach your financial goals

Make a strategy

Strategy will depend on the types of debt and its amount and will include the steps like,

• Timeframe
• Priority based on interest rate, or amount owed etc.
• Closing paid accounts etc.

Consolidate your debts

You may consider applying for a loan or line of credit to pay off multiple debts with high interest rates. This is called consolidating of debts. It will help you to make only one monthly payment rather than paying each of your debts individually.

A consolidation loan will help you get out of debt only if:

• it has a lower interest rate than you were already paying
• it has a lower monthly payment than all your other debts put together
• you avoid taking on more debt

If you do consider a consolidation loan, ensure your requirements are being taken care and make an informed decision.

A consolidation loan has its own issues as well. For example,

Eligibility for a consolidation loan

You must have an acceptable credit score and enough income to make monthly payments to be eligible for a consolidation loan. A financial institution doesn’t have to provide you with a consolidation loan.

Paying back a consolidation loan

Making the minimum payment on a consolidation loan will help you get out of debt eventually.

However, the minimum payment on a line of credit will usually only cover the interest that you owe. You won’t get out of debt if you only pay this amount. Increase your payments if you can, to help reduce your debt faster and pay less in interest.

A consolidation loan won’t hurt your credit rating if you make your payments on time.

Shop around for a consolidation loan

Make sure to shop around when you’re trying to consolidate your debt, as some companies may offer consolidation loans with interest rates that are higher than the debts you are trying to consolidate.

Different financial institutions may offer you different interest rates depending on the type of product you choose. For example, you may pay less interest on a line of credit than on a consolidation loan.

Stay away from taking on more debt

Once on track towards your financial freedom, make sure to stay away from new debt. You have been the same road before. The only way to get out of debt is stop incurring more debt.

The only way to spend more should be an increase income.

Know where to get help

If you need assistance don’t hesitate to contact with us, we have experienced team to help you out. Our team will analyze your financial situation thoroughly and propose a custom solution to suit your needs and put you back on track.

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