The Learning Centre:
Why pay more interest on your debt than you have to?
According to the Financial Consumer Agency of Canada, 41% of Canadian credit card holders are not aware of the interest rate charged by their main credit card company…
As national debt-to-income ratios across the country continue to rise, you could say it’s about time we all wake up and smell the interest rates.
- The average department store credit card charges 20% interest
- The average bank credit card charges 14% interest
- The average line of credit charges 8% interest
- You’re paying too much
Make this the year you resolve to take better control of your financial situation…
“With pension plan contributions, a salary dependent upon where you are on the pay grid, as well as the need to be financially sustainable throughout the summer – it can be challenging for educators to balance that whole income-to-debt ratio”, says Educators Financial Group Certified Financial Planner professional Kola Deru, whose daughter is a teacher. “But I can assure you, with the right plan and the drive to succeed it’s entirely possible to stop stressing about debt, and start living the life you want.”
Educators Director, Lending Services Amedeo Perfetto couldn’t agree more. “Debt can be an uncomfortable subject for people to talk about”, says Amedeo. “But I show my clients that there is light at the end of that ‘debt tunnel’ by providing them with lending solutions that can seriously lighten their financial burden.”
What a difference the interest rate can make…
Amedeo can’t emphasize it enough. “When it comes to interest rates, it pays to pay attention. By simply consolidating various high rate credit cards and personal loans into one low-rate option, such as a 4% interest line of credit offered through Educators††, you can seriously save yourself a bundle.”
|Strategy||Credit Card||Loan||Average LOC||LOC through Educators|
|Payoff Date||4 years||5 years||3 years||5 years|
|Combined monthly payment: $1,275.96||Save: $355.13/mo.|
From the example above, consolidating your high-interest debts into one low-rate line of credit offered through Educators has the potential to save you $21,307.80†† in interest.
That’s just the tip of the financial iceberg…
From consolidating high-interest debt into one low-rate option and creating a spending budget, to enlisting the help of a professional – preventing (or getting yourself out of) debt requires a solid strategy, tailored to your unique financial situation. As organization that has been working exclusively with the education community since 1975, Educators Financial Group is in the perfect position to help you make this the year you start conquering debt and successfully work toward your financial goals.
Interested in switching to a low-rate line of credit? Click here to have a lending specialist contact you!
†Monthly payment is 3% of balance.††Monthly payments will be a fixed blended payment of principal and interest equivalent to a 5 year amortization for unsecured line of credits and 10 years for secured line of credits. Lines of credit are facilitated through Tandia, upon approved credit. Other conditions may apply. The annual percentage rate (APR) on the example above is based on a $50,000 unsecured line of credit with blended monthly payments and a 5 year amortization and assumes no fees apply. Legal, registration and appraisal fees would increase the APR. The interest rate is variable and based on the rate of prime as determined by Tandia (as of December 7, 2012 – 3.50%) plus .50% for unsecured lines of credit and -.50% for secured lines of credit. Interest is calculated daily on the outstanding principal balance and payments will apply firstly to interest and secondly to principal. Interest rates are subject to change without notice. Notification of interest rate changes shall be provided in regular statements issued by Tandia. Offer may be changed, withdrawn or extended at any time without notice. Speak to an Agent-Regional Director for full details.