Reducing debt and increasing savings appear to be key targets for Australians at the moment. But knowing whether to opt for a personal loan or a credit card can be difficult.
Choosing between a credit card and personal loan depends on the amount of debt and the planned repayment timescale, according to money saving website, Mozo. Credit cards can be useful if you are able to make the required repayments in a shorter period of time, as interest rates on cards can be low to begin with.
However, personal loans tend to be a cheaper option in the long term, although there are stricter repayment terms and you make a commitment to repay the debt in a specified amount of time.
Whichever option suits you best, it is important to shop around for low interest rates to make the repayments as manageable as possible and reduce the time needed to become debt free.
Source: http://mozo.com.au/personal-loans/articles/personal-loan-or-credit-card-the-best-path-to-reducing-debt/573043322
