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Is a debt consolidation program a good idea?
Today’s high-rate environment has made it pretty tough for people to juggle their daily living expenses and their revolving debt. After all, when interest rates are high overall, variable-rate debt, like credit card debt, tends to cost a lot more than it otherwise would. And, with the average credit card rate currently closing in on 22%, and persistent inflation pushing prices higher on housing, gas and food, it’s easy to see why many people’s paychecks are being stretched thin.
These types of debts could get a bit easier to manage if interest rates decline in the future, but it’s unclear if and when that will happen. While many experts expected the Federal Reserve to start slashing rates mid-year, the sticky inflation issues that have surfaced over the last couple of months have pushed out those rate-cut predictions. So, it appears credit card rates are likely to stay high, at least for the near term.
If you’re currently struggling with credit card debt, future Fed rate cuts aren’t the only solution to the issue. Enrolling in a debt consolidation program can also help you get a lower interest rate on your existing debts, making it easier to pay off what you owe. But is enrolling in one of these programs actually a good idea?
Find out how the right debt relief solution could help you pay off what you owe.
Is a debt consolidation program a good idea?
A debt consolidation program is a type of debt relief service offered by debt relief companies — and these programs work similarly to taking out a debt consolidation loan on your own.
When you enroll in a debt consolidation program, your existing unsecured debts are consolidated into one loan, which typically comes with a lower interest rate than your credit cards. The loan is then repaid by making monthly payments to the debt relief company rather than making individual payments to each credit card servicer.
In general, a debt consolidation program can be a useful tool in a lot of scenarios, and it can result in significant interest savings over time. That said, this type of debt relief option may not be the best route to consider in all situations. Here’s when a debt consolidation program may (or may not) make sense.
When a debt consolidation program makes sense
For the right candidate, one of these programs can provide much-needed breathing room and a structured path out from under the burden of unsecured debt. In general, a debt consolidation program is ideal for those who:
- Owe $10,000 or more across unsecured debts with high interest rates over 15%
- Have a steady source of income to commit to a repayment plan
- Don’t qualify for low interest rates on traditional debt consolidation loans or balance transfer credit cards due to less-than-excellent credit
And, a debt consolidation program can make sense if:
You need more affordable payments
If you need more affordable monthly payments, a debt consolidation plan can make sense. With a debt consolidation plan, you typically get a lower interest rate on your loan compared to the individual rates on your credit cards. This makes your monthly payments more affordable and more of the money is allocated toward paying off the principal balances.
You prefer a single monthly payment
Rather than juggling payment due dates across different credit card issuers, each credit card debt gets packaged into one simplified monthly payment toward the consolidation loan. This helps to eliminate the risk of missed payments and the accompanying penalties and fees.
You want a fixed interest rate
The interest rate on a debt consolidation loan through a debt consolidation program typically remains fixed for the entire repayment period, providing consistency in terms of your monthly payments.
Learn more about the best debt relief options available to you now.
When a debt consolidation program doesn’t make sense
While the benefits of a debt consolidation loan are undeniable for the right candidates, these programs aren’t right for every borrower. A debt consolidation program may not make sense for:
- Borrowers who have reasonable unsecured debt balances that could realistically be repaid debt-free within two years or less through budgeting
- Those who qualify for low APR balance transfers or personal loans
And, debt consolidation programs may not make sense if:
You want to avoid extra fees
Most debt relief companies charge fees for their programs, and in many cases, these fees can be a portion of your total debt load. Those fees, in turn, can potentially negate some of the interest savings you receive from the lower interest rate tied to your debt consolidation loan.
Your credit score isn’t high
You’ll typically need a higher credit score to enroll in a debt consolidation program than you would for another type of debt relief, like debt management or debt settlement. So, if your credit score is damaged, you may not qualify for this type of program.
You want to pay off secured debt
Debt consolidation programs have no flexibility whatsoever for including secured debts like mortgages or auto loans. They are only an option for paying off your unsecured debts.
Debt consolidation program alternatives to consider
Before enrolling in a debt consolidation program, it could be wise to explore some other options, including:
- Debt management plans: A debt management plan can help you negotiate reduced interest rates on your credit cards without any upfront fees.
- Balance transfer cards: Those with good credit may qualify for a 0% APR balance transfer credit card promotion to consolidate debt interest-free for 12-18 months while aggressively repaying balances.
- Personal loans or home equity borrowing: Qualified borrowers could explore personal loans or home equity loans and home equity lines of credit (HELOCs) from banks and credit unions as lower-fee options for consolidating debt.
- Debt settlement: Those with low credit scores, little or no income or those who have already entered default status may want to consider debt settlement, or debt forgiveness, instead, as negotiating lump-sum debt settlements makes more sense than consolidation in these situations.
- Bankruptcy: When debts exceed your assets and income, bankruptcy is the option of last resort to discharge eligible unsecured debts entirely and get a financial fresh start.
The bottom line
Debt consolidation programs provide one viable solution for debt relief — but the best path forward depends heavily on your full financial picture. Before deciding on a route to take, be sure to carefully assess your debt amount and the types of debt you have, along with your income, assets and credit. Weighing these and other factors can help you determine the best path forward.
CBS News
Former Israeli hostages released in truce 1 year ago call for action to release those still held
Former Israeli hostages who were freed from Hamas captivity during a week-long humanitarian pause in fighting exactly one year ago Sunday called for immediate action to secure a deal for the release of those still held.
The only truce in the ongoing Israel-Hamas war on Nov. 24, 2023 – fewer than two months after fighting began – led to the release of 80 Israelis held by militants in Gaza. They were freed in exchange for 240 Palestinians detained in Israeli jails.
Repeated efforts since then by mediators from Qatar, Egypt and the United States to secure another truce and hostage release have failed. Qatar early this month said it was suspending its mediation role until the warring sides show “seriousness.”
Gabriella Leimberg was kidnapped during the Oct. 7, 2023, Hamas attack and was released along with her daughter, Mia, and sister Clara.
“For 53 days, the one thing that kept me going is that we, the people of Israel, the Jewish people, sanctify life — we don’t leave anyone behind,” she said.
Leimberg added: “Everything has already been said and now action is required. We don’t have any more time.”
Around 100 hostages are still in Gaza, and at least a third are believed to be dead.
“I survived and I was fortunate to get my entire family back,” Leimberg said. “I want and demand this for all the families of the hostages.”
Hamas wants Israel to end the war and withdraw all troops from Gaza. Israel has offered only to pause its offensive.
The Palestinian death toll from the war surpassed 44,000 this week, according to Gaza’s Health Ministry, which does not distinguish between civilians and combatants in its count.
Danielle Aloni, who was kidnapped with her five-year-old daughter, Emelia, and freed after 49 days, spoke at the ceremony of the “increasing danger” those still being held face every day.
She said those still in captivity “suffer physical, sexual, and psychological abuse, their identity and dignity crushed anew each day”.
“It took the Israeli government about two months to secure a deal for me and 80 other Israeli hostages. Why is it taking over a year to reach another deal to free them from this hell?” asked Aloni, whose brother-in-law, David Cunio, and his brother, Ariel Cunio, are still being held.
She emphasized that, even though she and the other hostages gained their freedom a year ago, “we haven’t really left the tunnels,” — referring to Hamas’ underground tunnels where many of the hostages were held.
“The feeling of suffocation, the terrible humidity, the stench — these sensations still envelop us,” Aloni said.
“If people could truly understand what it means to be held in subhuman conditions in tunnels, surrounded by terrorists for 54 days — there’s no way they would allow hostages to remain there for 415 days!” said Raz Ben Ami, who was released in the deal a year ago.
Her husband, Ohad, is still among those being held.
Ben Ami called for a ceasefire to “bring back all the hostages as quickly as possible”.
CBS News
Couple charged for allegedly stealing $1 million from Lululemon in convoluted retail theft scheme
A couple from Connecticut faces charges for allegedly taking part in an intricate retail theft operation targeting the apparel company Lululemon that may have amounted to $1 million worth of stolen items, according to a criminal complaint.
The couple, Jadion Anthony Richards, 44, and Akwele Nickeisha Lawes-Richards, 45, were arrested Nov. 14 in Woodbury, Minnesota, a suburb of Minneapolis-St. Paul. Richards and Lawes-Richards have been charged with one count each of organized retail theft, which is a felony, the Ramsey County Attorney’s Office said. They are from Danbury, Connecticut.
The alleged operation impacted Lululemon stores in multiple states, including Minnesota.
“Because of the outstanding work of the Roseville Police investigators — including their new Retail Crime Unit — as well as other law enforcement agencies, these individuals accused of this massive retail theft operation have been caught,” a spokesperson for the attorney’s office said in a statement on Nov. 18. “We will do everything in our power to hold these defendants accountable and continue to work with our law enforcement partners and retail merchants to put a stop to retail theft in our community.”
Both Richards and Lawes-Richards have posted bond as of Sunday and agreed to the terms of a court-ordered conditional release, according to the county attorney. For Richards, the court had set bail at $100,000 with conditional release, including weekly check-ins, or $600,000 with unconditional release. For Lawes-Richards, bail was set at $30,000 with conditional release and weekly check-ins or $200,000 with unconditional release. They are scheduled to appear again in court Dec. 16.
Prosecutors had asked for $1 million bond to be placed on each half of the couple, the attorney’s office said.
Richards and Lawes-Richards are accused by authorities of orchestrating a convoluted retail theft scheme that dates back to at least September. Their joint arrests came one day after the couple allegedly set off store alarms while trying to leave a Lululemon in Roseville, Minnesota, and an organized retail crime investigator, identified in charging documents by the initials R.P., recognized them.
The couple were allowed to leave the Roseville store. But the investigator later told an officer who responded to the incident that Richards and Lawes-Richards were seasoned shoplifters, who apparently stole close to $5,000 worth of Lululemon items just that day and were potentially “responsible for hundreds of thousands of dollars in loss to the store across the country,” according to the complaint. That number was eventually estimated by an investigator for the brand to be even higher, with the criminal complaint placing it at as much as $1 million.
Richards and Lawes-Richards allegedly involved other individuals in their shoplifting pursuits, but none were identified by name in the complaint. Authorities said they were able to successfully pull off the thefts by distracting store employees and later committing fraudulent returns with the stolen items at different Lululemon stores.
“Between October 29, 2024 and October 30, 2024, RP documented eight theft incidents in Colorado involving Richards and Lawes-Richards and an unidentified woman,” authorities wrote in the complaint, describing an example of how the operation would allegedly unfold.
“The group worked together using specific organized retail crime tactics such as blocking and distraction of associates to commit large thefts,” the complaint said. “They selected coats and jackets and held them up as if they were looking at them in a manner that blocked the view of staff and other guests while they selected and concealed items. They removed security sensors using a tool of some sort at multiple stores.”
CBS News contacted Lululemon for comment but did not receive an immediate reply.
CBS News
Former Trump national security adviser says next couple months are “really critical” for Ukraine
Washington — Lt. Gen. H.R. McMaster, a former national security adviser to Donald Trump, said Sunday that the upcoming months will be “really critical” in determining the “next phase” of the war in Ukraine as the president-elect is expected to work to force a negotiated settlement when he enters office.
McMaster, a CBS News contributor, said on “Face the Nation with Margaret Brennan” that Russia and Ukraine are both incentivized to make “as many gains on the battlefield as they can before the new Trump administration comes in” as the two countries seek leverage in negotiations.
With an eye toward strengthening Ukraine’s standing before President-elect Donald Trump returns to office in the new year, the Biden administration agreed in recent days to provide anti-personnel land mines for use, while lifting restrictions on Ukraine’s use of U.S.-made longer range missiles to strike within Russian territory. The moves come as Ukraine marked more than 1,000 days since Russia’s invasion in February 2022.
Meanwhile, many of Trump’s key selection for top posts in his administration — Rep. Mike Waltz for national security adviser and Sens. Marco Rubio for secretary of state and JD Vance for Vice President — haven’t been supportive of providing continued assistance to Ukraine, or have advocated for a negotiated end to the war.
McMaster said the dynamic is “a real problem” and delivers a “psychological blow to the Ukrainians.”
“Ukrainians are struggling to generate the manpower that they need and to sustain their defensive efforts, and it’s important that they get the weapons they need and the training that they need, but also they have to have the confidence that they can prevail,” he said. “And any sort of messages that we might reduce our aid are quite damaging to them from a moral perspective.”
McMaster said he’s hopeful that Trump’s picks, and the president-elect himself, will “begin to see the quite obvious connections between the war in Ukraine and this axis of aggressors that are doing everything they can to tear down the existing international order.” He cited the North Korean soldiers fighting on European soil in the first major war in Europe since World War II, the efforts China is taking to “sustain Russia’s war-making machine,” and the drones and missiles Iran has provided as part of the broader picture.
“So I think what’s happened is so many people have taken such a myopic view of Ukraine, and they’ve misunderstood Putin’s intentions and how consequential the war is to our interests across the world,” McMaster said.
On Trump’s selections for top national security and defense posts, McMaster stressed the importance of the Senate’s advice and consent role in making sure “the best people are in those positions.”
McMaster outlined that based on his experience, Trump listens to advice and learns from those around him. And he argued that the nominees for director of national intelligence and defense secretary should be asked key questions like how they will “reconcile peace through strength,” and what they think “motivates, drives and constrains” Russian President Vladimir Putin.
Trump has tapped former Rep. Tulsi Gabbard to be director of national intelligence, who has been criticized for her views on Russia and other U.S. adversaries. McMaster said Sunday that Gabbard has a “fundamental misunderstanding” about what motivates Putin.
More broadly, McMaster said he “can’t understand” the Republicans who “tend to parrot Vladimir Putin’s talking points,” saying “they’ve got to disabuse themselves of this strange affection for Vladimir Putin.”
Meanwhile, when asked about Trump’s recent selection of Sebastian Gorka as senior director for counterterrorism and deputy assistant to the president, McMaster said he doesn’t think Gorka is a good person to advise the president-elect on national security. But he noted that “the president, others who are working with him, will probably determine that pretty quickly.”