Several bills, one payment: Is debt consolidation right for you?

Auto loans, student loans, credit cards, medical debt…as we make our way through life, it’s easy to become overextended, with too many bills and not enough money coming in to pay for it all.

Keeping large amounts of debt, especially at high-interest rates, can be expensive. It can also take a toll on your emotional wellbeing. But even if your debt feels overwhelming, don’t despair. There are steps you can take to turn your financial life around.

Sound financial advice is one of the many benefits of your Harborstone Credit Union. If you find yourself worried about the debt you carry, we are here to help.

Considering consolidation

Debt consolidation refers to the process of using a single loan to pay off multiple debts. This helps to streamline your finances. It can also save you money in the long term, if the loan used for the consolidation has a favorable interest rate.

Consolidation may protect your credit score by taking away the risk that one of your multiple debt payments might slip through the cracks and go unpaid. Bonus: You’ll feel more organized, which can lighten your emotional load.

Getting to the root

One thing to keep in mind: A debt consolidation strategy itself doesn’t fix underlying financial challenges.

Shelly Burrell is a senior personal banker at Harborstone’s Federal Way branch. Part of the service she and her colleagues offer members is financial counseling, which sometimes includes the option of debt consolidation to begin the process of reducing debt – all with an eye toward future financial prosperity.

Shelly says the process begins with an in-person appointment, where she and the member just talk about their financial history, comfort level with banking and finances, and personal goals.

“Each member’s situation is different,” Shelly says. “We have to start at the beginning of the journey every time. It takes a lot of trust for a member to open up and share, and we respect their wishes and tailor our approach to suit their particular need.”

Shelly says some members feel embarrassment or shame about their finances, or about their lack of knowledge about banking and money. “This can be an obstacle for some, but over time, we try to increase comfort and encourage them to look forward, not back.” Shelly has a wide range of tools to help members learn, make plans and take their first steps. And she’s the first one to celebrate each member’s successes, every step of the way.

“Meeting members where they are, getting into the details and being able to start to tackle their debt and save money each month – it’s really rewarding, for both sides,” she says. “I love what I do.”

Are you interested in meeting with one of our personal bankers to get your finances on track and reach your financial goals? We’d love to see you! Call your local branch or make an appointment online.