This is perhaps the most common debt consolidation loan mistake. With the best of intentions you go and get a credit card debt consolidation loan to pay off your credit cards. You start making your loan payments, and you feel great because you only have one debt payment to make each month.
All is good.
But then, something happens. Your car breaks down, or you need to buy something for the kids. Or you want to take a vacation. And then you realize, hey, wait a minute; I have all of these credit cards that I paid off with no balances owing! I can just use my credit cards to buy what I want! Problem solved!
There is nothing wrong with using credit cards, but you should only use credit cards if you know you can pay them off in full at the end of the month. If you want to take a vacation, tha’’s fine – pay cash.
Remember, the reason you got a debt consolidation loan was to improve your finances. If you consolidate your credit cards, and then rack them up again, you have made your finances worse, not better, because you now have more debt than you started with.
For a review of the top debt consolidation loan mistakes, read our article on the Top Debt Consolidation Loan Mistakes, because if you know the mistakes, you can avoid them and have a positive experience with your debt consolidation loan.
You must log in to post a comment.