The Power of Consolidation - measured in real numbers
If you’re juggling multiple credit cards or loans, a debt consolidation loan might seem like just another option. But when done right, it can actually save you thousands of pounds in interest and fees.
So how much could you save? That depends on a few key factors—but don’t worry, we’ve built a free consolidation loan savings calculator to help you work it out.
Let’s break it down with real examples so you can see how much you could save by consolidating debt.
What affects your savings potential?
Before you jump into the numbers, it’s worth understanding what actually drives those savings:
1. Interest Rate
This is the biggest lever. Most UK credit cards charge 20–30% APR, while personal loans (used for consolidation) can start around 6–12% for good credit. The lower your new rate, the more you save.
💡 Even a small drop in APR can save hundreds over the life of a loan.
2. Loan Term
Longer loan terms = lower monthly payments but more total interest.
Shorter terms = higher monthly payments but greater long-term savings.
Always balance affordability with long-term cost.
3. Fees
Some lenders charge:
- Origination fees
- Early repayment charges
- Balance transfer fees
Make sure you factor these into your savings calculation.
Try Our Free Calculator
Use our Consolidation Calculator to check how much you could save on interest. Just enter:
- The balances on each card, and
- Current interest rate(s)
You’ll instantly see your monthly savings, total interest saved, and your payoff timeline.
Example Scenarios: How Much Could You Save?
Let’s look at two real-life examples of how a consolidation loan can reduce costs:
Example 1: £5,000 on One Credit Card
- Current Rate: 24% APR
- Minimum Payments: £150/month
- Time to Pay Off: ~5 years
- Total Interest: £3,200+
✅ Consolidation Loan at 9% APR, 3 years:
- Monthly Payment: ~£160
- Total Interest: ~£700
- You Save: £2,500+
Example 2: £10,000 Across 3 Cards
- Average Rate: 26% APR
- Monthly Payment: £300
- Time to Pay Off: ~7 years
- Total Interest: Over £7,000
✅ Consolidation Loan at 8.5% APR, 5 years:
- Monthly Payment: ~£205
- Total Interest: ~£2,200
- You Save: Nearly £5,000
How to Maximise Your Savings
To make the most of a debt consolidation loan:
✅ Shop for low-interest rates
✅ Avoid unnecessary fees
✅ Don’t extend the loan longer than needed
✅ Avoid running up more debt once your cards are cleared
Want to see if it’s right for you? Use our calculator now and start your Plan with Incredible.
Conclusion
You could be throwing away hundreds - or even thousands on credit card interest every year. A consolidation loan might be your simplest way to cut costs, simplify your payments, and become debt-free faster.
