ArticleCity.comArticle Categories Top 10 Smart Ways to Consolidate Bills

Top 10 Smart Ways to Consolidate Bills

Debt can be an intimating and looming problem on the horizon of your financial future. 

With the average American household carrying an estimated revolving balance of $6,741, you are not alone if paying all of your credit card bills is a struggle.

Moreover, it can be overwhelming when you tack on other common forms of debt such as student loan debt, mortgages, or car payments.

One potential solution is through debt consolidation. This method involves combining all of your collective debt under fewer institutions so that the interest rate is not compounding as quickly.

There are several potential strategies to consolidate bills for debt, including credit cards.

Read on below for some key tips on doing so, and how you can one day in the future be completely debt-free.


1. Take a Complete Debt Inventory

The very first thing to do is to take a complete inventory of all of your debt, from even the smallest sources.

Once you have this down, be sure to record the interest accruing on each, as this is important for figuring out your payment strategy.

Moreover, you can use the number to determine how quickly you could pay it off. This is a good time to assess your income to debt ratio, and what the maximum amount you could pay looks like.

You can do this by establishing the averages for all of your bills and expenses, and then determining how much you could contribute to paying off your debt. It is also a good idea to see where you can reduce your spending.

2. Determine What Needs to Go

Decide what loans have the highest interest, and which need to be paid off or consolidated as soon as possible.

If there are a few clear loans or credit cards that have interest rates through the roof, immediately think about what you can do to at least consolidate that debt elsewhere, for a lower interest rate.

Moreover, debt such as a mortgage can actually be beneficial for you and your investments. Therefore, as long as you are making those payments, there isn’t really a need to worry about these unless your interest rate is much higher than the average.

3. Consider Family and Friend Loans

Before proceeding to other lenders, it is a good idea to see if there are any personal resources you can tap into for help.

Friends and family are often willing to lend a helping hand, especially if it’s for a good reason. Paying off debt is a great reason.

You may need to form a written agreement in advance to ensure you both understand expectations and the repayment plan.

4. Think about Borrowing Against Retirement Accounts

Another good option for a low-interest loan is to borrow against a retirement plan or mortgage.

Both of these are amounts that lenders will know that you have, and this tends to be a safer bet on their end. This is how they give you a higher quality loan.

Therefore, if it is an option for you, determine if borrowing against a retirement account or 401k is the right choice for debt consolidation.

5. Explore Debt Consolidation Loans

If the above options don’t shake out, or if you’d like to compare other loans, consider a debt consolidation loan.

These are special loans that allow you to transfer all balances to one loan, generally speaking, so that you only have to make one payment each month. 

This is beneficial because you can easily keep track of all of your debt, payments, and interest in one place. 

In the event that you are in a place where you need an immediate loan, here is everything you need to know about choosing a payday loan.

6. Opt for a Balance Transfer

Balance transfers can also be an easy option for consolidating bills. It is best to look for a credit card that does not charge for a balance transfer.

Moreover, one way to essentially ‘trick’ the system is to find a credit card that offers 0% APY for the first year. As long as you can pay off all of the balance before the end of the year, you won’t accrue any interest on your debt and will only be paying the principle.

7. Find a Path Forward

Generally, there are two ways to go about paying off all debt. There is the “Snowball Method”, which involves making the minimum payments on all debt, and then you’d pay as much as possible for the smallest balances.

Alternatively, there is the “Avalanche Method”, which involves paying off the highest interest debt first, and paying the minimum on the remaining open credit lines.

Both of these can be effective, but the Snowball method tends to help people feel better about paying down debt since you can see your open credit lines disappearing faster.

8. Set Aggressive Goals

It is best to set aggressive payment goals for credit card debt, as it will continue to impede on your long term financial wellness.

Again, determine what the highest amount you can pay is for your debt, and try to max that out every month, if not more by decreasing spending in other areas.

9. Meet with a Credit Counselor

As you prepare for your new, debt-free life, consider consulting with a credit counselor. They can give you individualized support and advice for maintaining a good credit score.

Try to schedule an appointment sometime towards the middle or end of your debt journey, and speak with them about the best way to only accrue small and necessary amounts of debt going forward.

10. Celebrate Every Little Win

The best part of paying off debt, even incrementally? Celebrating, of course!

Every dollar you pay is another step towards true financial freedom, and it should be treated as such. You are going in the right direction as long as that bottom line is decreasing each month.

However, it is important to note that when celebrating, you shouldn’t use that as an excuse to do something financially reckless. Save that for when you are completely done with debt and have extra money to spend.

Use these Methods to Consolidate Bills

It doesn’t have to be incredibly difficult to consolidate bills and debt. In fact, with a bit of searching, you can easily find the best consolidation loan and method for you.


Ready to take the leap towards financial freedom? Share this article to tell your friends loud and proud you are prepared to be done with debt for good!

No Comments

Sorry, the comment form is closed at this time.