Brian Acton

Debt consolidation can help some borrowers pay off debt faster by combining their debts, simplifying their monthly payments, and even saving money on interest.

Paying off debt has short-term and long-lasting benefits for your finances. You can reduce your monthly bills, putting more money back in your pocket. You can simplify your financial picture by reducing the bill payments you must manage. And you can save hundreds, or even thousands, of dollars in interest.

Payday loans offer quick cash when you're in a financial bind, but they come with significant drawbacks.

When you have no credit history, you also have no credit score. This happens because there's simply no information available to create a credit report or calculate a score, either because you've never used credit before or haven't used it in a very long time.

Home equity loans allow you to borrow up to 80% of your home's value at a fixed interest rate — typically lower than personal loans or credit cards because your home secures the debt. The average home equity loan rate as of early 2026 runs between 7%–9% depending on your credit score, loan term, and lender. Here's how they work, what they cost, and when they make financial sense.

When your credit isn't in the best shape, reaching your financial goals becomes significantly more challenging. You'll face difficulties getting approved for credit, and might also miss out on the best interest rates available. It might even prevent you from landing certain jobs or renting the home you want.

Millennials and Gen X are doing what personal finance experts recommend: saving regularly. But for many, that is not keeping them out of debt.

Installment loans let you borrow a lump sum and repay it through fixed monthly payments over a set period. They offer predictable costs and can help build credit, but you risk losing collateral if you can't repay secured loans.

Debt can be a very useful strategy for reaching your financial goals. It can help you buy a home, start a business, or get an education. And you can use it to afford everyday purchases.

Credit utilization accounts for 30% of your FICO score — and debt consolidation can change it dramatically in either direction.