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How to Start Paying Down Credit Card Debt Without Making Major Spending Cuts

Aileen Perilla/The Penny Hoarder

So you have some credit card debt…

Don’t we all these days? We’re not trying to be flippant, but the data paints a picture: More than one-third of Americans have a lingering balance (more than $2,500, on average) on their credit cards despite making monthly payments, according to a Penny Hoarder analysis of Federal Reserve survey data.

What can we do?

Drastically cut spending? Adhere to a strict budget? Never have fun again?

Actually… there is one thing you can do. It’s pretty simple, takes very little time and won’t require you to change your lifestyle.

Say whaaatttt?

Yup! Look into consolidating your credit card debt.

What’s that mean?

It means you’ll take out a personal loan to pay off your outstanding balance(s). The idea is to get a loan that has a better (lower!) interest rate than your credit cards. You’ll wind up paying less in interest over time or even pay off your debt faster.

Not sure where to look for such a loan?

Credible is an online marketplace that will provide you personalized loan offers. It’s best if you have a good credit score (think: around 640 or higher), and it lets you quickly compare rates without visiting a bunch of sites and getting flooded with emails and phone calls.

Rates start at 3.99%. You can check yours by entering a loan amount here (up to $100,000) and comparing your personalized options in less than two minutes.

At first, it might not seem like this will make a huge difference, but Katherine, for example, faced $12,000 in credit card debt. The 15.24% interest rate kept her from chipping away at the principal. So she chose to consolidate with a 5%-interest, seven-year personal loan.

Over time, she wound up saving $12,000 in interest.

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