Whether it’s high-interest credit cards, medical bills, or student loans, many people find themselves in dire financial straits with more debt than they can handle. This leads them to scour the internet for a solution. Luckily, there are plenty of fintech companies that can help them navigate these tricky financial waters, pay off debt, and get their finances back on track. Here are five ways fintech companies can help someone get out of debt.
1) Organize your bills
We live in a time where we have different bills from all directions, whether it’s cable, utilities, subscription services, credit cards, or student loans; the list goes on endlessly. There are many services and apps that allow you to manage your bills and track your payments. If you can see all your bills in one place, instead of having to dig through endless paper statements or emails, it will make your life easier. Becoming debt-free starts with physically organizing your spending, and there are plenty of fintech services that can help you do that.
2) Find the best interest rate
Comparison shopping is no longer just for retail. Now consumers can go online and find financial products that match their income and goals. When it comes to paying off debt, most people turn to debt consolidation loans to lower their monthly payments and/or lower their interest rates. This speeds up their debt repayment and, more importantly, gives them a concrete finish line as to when they can expect to be debt free. Many fintechs have technology that can connect consumers with the right lender in seconds and make the loan application process as easy as possible. Users can compare lenders side by side and make an informed decision on their best option. With the market of potential borrowers being so competitive, the real winner is the consumer, who can now easily find the best deal(s).
3) Boost your credit score
Credit score and debt often go hand in hand. Those who have debts they would like to pay off are usually also concerned about their credit score. While most credit card providers offer a free service that lets you monitor your credit score, some other apps and companies take your credit score deeper, usually as a subscription-based service. Consumers can now view their entire credit history in real time, find out what’s currently affecting their score, and find ways to improve it. Although credit score is not an end in itself when it comes to your financial situation, it is essential to be aware of it if you are looking to get your finances back on track.
Unfortunately, many people are unfamiliar with debt and financial education. Some of the essential principles, be it budgeting, investing, or debt repayment, are not taught in our schools. For this reason, many people turn to fintech companies that offer free financial education resources. Not only can people learn basic personal finance concepts, but they can then apply them to their own personal lives. Fintech companies can tell us about credit scores, savings, budgeting, and investing. When it comes to debt repayment, consumers can also learn about the different debt consolidation options, the pros and cons of each, and when each makes sense. There is no single answer to any personal finance question, as each person’s situation is unique. Luckily, with the amount of free content available online from fintechs, you’ll be able to find the answer you’re looking for.
5) Budget, savings, investment
Learning to budget and save not only helps you pay off debt faster, but it’s also a life skill that will help you build wealth for you and your family. Once your debt is paid off, most people will look to invest the extra money they currently have. The fintech industry is currently booming with companies and services that can help newbies invest their money. Depending on your level of risk aversion, you’ll want to choose the right service and investments that fit your unique profile. Many platforms can help you achieve your investment goals, and most have little or no fees.
Getting out of debt can seem like a daunting task. Yet, with the technological advances that have taken place across the fintech industry, consumers now have plenty of resources to simplify the process. Fintech companies help educate consumers on financial best practices, allow them to compare different products, and make it easier for them to invest their money once they are debt-free.
About the Author: James Lambridis is the founder and CEO of Debt®