Personal loans are 3% cheaper than credit cards
On a credit card balance of $2,000 if you're paying interest of 20% annually that works out to a monthly charge of about $33.
If the minimum repayments are set at 2 per cent of the card balance, you may only be asked to repay $40 each month, which means the debt is being reduced by only $7 a month.
If you're serious about clearing card debt, one solution is to use a personal loan to pay off the balance. This will almost certainly increase your monthly repayments but the debt will be paid off in three to five years depending on the loan term.
You're also likely to save on total interest costs as personal loan rates currently average around 14 per cent – 3 per cent below average credit card rates.
Check out InfoChoice for the some of the best deals on personal loans.
Source: Fraser Coast Chronicle