Could a personal loan save you from Christmas credit card interest?

Congratulations, you’ve managed to get all of the gifts under the Christmas tree and the fridge is fully stocked, but after a frantic December, are you a little hesitant to take a peek at your credit card statement?

If that is the case, you can take some solace from that fact that you’re not alone. In fact, Aussies are likely to whack about $29 billion worth of Chrissy expenditure on their credit cards throughout December - that’s almost $4,000 per household.

With credit card interest rated as the fourth biggest money drain on Aussie households, the cost of Christmas could continue well into the new year for those unable to pay off their balance in full at the end of the December statement cycle.

RELATED: Personal loans on the up ahead of Christmas

And while taking out another loan might seem like the last thing you want to do, SocietyOne’s Maria Loyez insists that using a personal loan to consolidate your debt is a smart strategy to manage repayments and avoid the pricey purchase rates on a lot of plastics.

“If you have multiple credit cards or loans, this can cost you hundreds or thousands of dollars in interest which could be better used towards your goals,” she said.

“Consolidating your debt into a fixed-term personal loan, with lower interest rates than credit cards, can be a good option to reduce interest and allow you to plan ahead with manageable monthly payments.”

RELATED: Want your own rooftop solar system? A green personal loan could be the answer

If the idea of grouping all of your Christmas debt into one, low-interest loan sounds attractive to you, check out a bunch of popular options below or to find out what your repayments would look like use Mozo’s personal loan repayments calculator.

Popping personal loans

Rates updated daily. Advertiser disclosure.

• Promoted

  

  Alex Bank

  Personal Loan (Unsecured, Fixed)

  interest rate

  5.45% p.a.to 19.99% p.a.

  comparison rate

  5.45% p.a.to 19.99% p.a.based on $30,000
  over 5 years

  Go to site
• Promoted

  

  OurMoneyMarket

  Low Rate Personal Loan (Excellent Credit) (Fixed, Unsecured)

  interest rate

  5.45% p.a.to 8.48% p.a.

  comparison rate

  6.07% p.a.to 8.84% p.a.based on $30,000
  over 5 years

  Go to site
• Promoted

  

  NOW Finance

  No Fee Unsecured Personal Loan (Fixed)

  interest rate

  5.95% p.a.to 17.95% p.a.

  comparison rate

  5.95% p.a.to 17.95% p.a.based on $30,000
  over 5 years

  Go to site
• Promoted

  

  Plenti

  Personal Loan (Unsecured, Fixed, Excellent Credit)

  interest rate

  6.39% p.a.to 7.49% p.a.

  comparison rate

  6.39% p.a.to 8.19% p.a.based on $30,000
  over 5 years

  Go to site
• Promoted

  

  Harmoney

  Unsecured Personal Loan (Fixed)

  interest rate

  5.35% p.a.to 19.09% p.a.

  comparison rate

  6.14% p.a.to 19.99% p.a.based on $30,000
  over 5 years

  Go to site

The pros and cons of personal loan debt consolidation

Pros

• Typically lower interest rates than on a credit card
• One, easy-to-manage loan
• Ability to go with a fixed rate, meaning you know what your repayments will look like for each instalment
• Unsecured loans available, meaning you won’t have to offer any collateral

Cons

• Pricey upfront cost to take out the loan
• Minimum loan term, meaning you’re unable to pay off the balance and close the loan early