First steps to getting control over the money

Loan consolidation is nothing more than a disadvantage because you think you have done something about your debt problem. The debt is still there, as are the habits that caused it; you just moved it. You cannot borrow your way out of debt. You cannot get out of a hole by digging out the bottom. True debt consolidation help is not quick or easy. One of the first steps to getting control over the money in- money out is to get it all in black and white. Write it all down, including any personal debts you owe to friends or your family. Then begin your plan to systematically pay off debts. This isn’t an entire answer to the problem, but simply the first step. Keep reading, keep plugging away and learning everything you can about money management.

Loan consolidation seems appealing because there is a lower interest rate on some of the debt and a lower payment. However, in almost every case we review, we find that the lower payment exists not because the rate is actually lower but because the term is extended. If you stay in debt longer, you get a lower payment, but if you stay in debt longer, you pay to loan consolidation lender more, which is why they are in the debt consolidation business.

The real way to get out of your debt is not the interest rate but a total money makeover. The way you get out of debt is by changing your habits. You need to commit to getting on a written game plan and sticking to it. Get an extra job and start paying off the debt. Live on less than you make. It is not rocket science, but it is emotional, which is why most people need help getting through it from someone. Loan consolidation is dangerous because you treat only the symptom.