When to use a personal loan to pay off credit card debt

Core Insights - The article discusses the necessity of personal loans for debt consolidation due to high credit card interest rates, with an average APR of 19.72% as of December 2025 [2][5] - It highlights the advantages of consolidating credit card debt into a personal loan, particularly the potential for lower interest rates and simplified payments [4][6] Group 1: Debt Consolidation Benefits - Personal loans can offer lower interest rates compared to credit cards, with average APRs of 12.21% for personal loans versus 19.72% for credit cards [5] - Consolidating multiple credit card debts into a single personal loan simplifies the repayment process, reducing the number of payments to one per month [6] Group 2: Financial Calculations and Examples - A hypothetical example illustrates the benefits of consolidating $12,000 in credit card debt at a 10% APR, allowing for more effective debt repayment compared to paying off high-interest credit cards [7][8] - Utilizing a debt repayment calculator can help consumers understand how much sooner they could pay off their debt with a lower interest rate [7] Group 3: Considerations Before Taking a Personal Loan - While personal loans can be beneficial for debt consolidation, they may not be suitable for individuals overwhelmed by debt, emphasizing the importance of reviewing spending habits before proceeding [9]