Don’t Let Your Debts Be The Boss Of You [QUIZ]

Don’t Let Your Debts Be The Boss Of You [QUIZ]

In partnership with Standard Chartered

 

 

For most people, debt is a part of life. We need debts to get an education, buy a car, own a home or even expand our business.

That’s not necessarily a bad thing – if managed well. Good debts that are managed well can help us achieve our financial goals and improve our quality of life.

However, when debts are not being managed properly, it can destroy our lives.

So, how well are you managing your debts? Take this quiz to find out.

 A debt consolidation plan is an unsecured loan that offers a lower interest rate to help you manage your debts better. It may sound ironic to take up a loan to cover your other debts, but sometimes it may be your ticket to being debt-free.

If you are currently holding a few outstanding debts – like other personal loans and credit card balances – it makes sense to consolidate your debts into one lower-interest loan. By doing so, you may be able to lower your overall interest payments, fix your monthly repayment, and also predetermine your settlement period. Not to mention the convenience of managing just one repayment instead of multiple.

For example, you are currently earning S$4,000 and currently hold the following debts:

Personal loan S$21,000.00
Credit card AS$12,800.00
Credit card BS$8,200.00
OthersS$6,000.00
TOTAL DEBTSS$48,000.00

Here’s how a debt consolidation plan can work in your favour:

Total debt S$48,000.00
Joining feeS$199.00
Tenure6 years
Applied/flat interest rate5.68% per annum
Monthly repaymentS$896.63
Total interestS$16,358.40
Estimated total costS$16,358.40 + S$199.00 = S$16,557.40

If you choose not to consolidate, here’s how much it can cost you:

 Personal LoanCredit card ACredit card BOthers
Outstanding balanceS$21,000.00S$12,800.00S$8,200.00S$6,000.00
Interest rate (p.a.)6.88%25.00%25.92%4.50%
Monthly repaymentS$412.10

5% of outstanding balance


First payment = S$640.00

5% of outstanding balance


First payment = S$410.00

S$122.50
Time to pay off6 years9 years 5 months8 years 4 months5 years
Total interest incurredS$8,668.80S$8,735.64S$5,799.60S$711.49

Total interest incurred without a debt consolidation plan is a whopping S$23,915.53. If you choose to consolidate your debts with Standard Chartered debt consolidation plan, you would be saving about S$7,358.13!

Without a debt consolidation plan, you will be forking out S$1,584.60 in the first month to pay off all four balances, and it will take you more close to a decade to be completely debt-free (assuming you are not taking up more loans or credit card debts in between).

The debt consolidation plan does not only let you pay off all your debts in a shorter time, you will also enjoy better cash flow because you would only need to pay S$896.63 every month. You can adjust the repayment amount and the tenure according to your needs and financial capabilities.

Juggling too many debts can be stressful and letting one repayment drop can be a disaster. This is why debt consolidation is good for you as you will only need to deal with one lender, and make a single payment on one due date. This makes life so much simpler and easier.

If you are serious about being debt-free, consolidating your debts is a right move towards the right direction. However, it is not magic. If you are not disciplined in your repayments, you will end up racking up more interest charges, and back to square one.

You must be proactive in managing your debts, and not wait until it’s too late. Consider a low-interest debt consolidation plan and see how it can benefit your finances!

Standard Chartered Debt Consolidation Plan

Standard Chartered Debt Consolidation Plan

Free yourself from higher interest payments & consolidate your debts with interest starting from 4.98% per annum.

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