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This is financial planner Patrick Munro asking the question does debt consolidation ruin
credit. Well the answer to that question is if you consolidate too many times the credit
reporting agencies are going to see that you don't have a handle or control over credit.
And it will ruin your credit. If it's done effectively right once the first time and
you learn from your mistakes and you transfer credit in a consolidated fashion and pay it
all off. And then start taking the money that you used to pay for credit card interest and
transfer it into savings and wealth building, then by all means it will not ruin your credit
but rather enhance your credit. So you have to understand that it's a function of interest.
Someone is going to receive the interest. In this case it will be the credit card company
or the department store that you owe money to as a creditor. It's better to be a person
that is receiving the interest from the savings and the investments that they have and you
can decide which person you want to be. If you are in a lot of credit card debt right
now, take heart because you can consolidate and march towards a better economic future.
This is Patrick Munro financial adviser.