Can Debt Consolidation Last?
The idea is that you take all of your outstanding debts and you lump
them into one debt consolidation which means you now have one payment to
pay each month. This makes it easier for you to make your bills because
you are only making one payment a month, and it reduces the amount of
money that you would be paying because debt consolidations usually have
a lower interest rate.
The idea behind a debt consolidation is to take the debt that you have
already incurred and make it easier to handle. It would reduce your
stress and worry because you would not be beholden to all of those
creditors any more and it could help you get debt free. But once you pay
off all of those credit cards and you have one monthly payment on those
bills, what do you do with all of the empty cards?
Debt consolidation does not teach you how to be responsible for your
money, it simply helps you clean up the mess that you have created from
all of that debt. If you take all of those empty credit cards and rack
them back up, you are going to have the debt consolidation loan to pay
off as well as a slew of more debt. This does not solve your problem.
You might be able to continue getting debt consolidations each time you
rack everything up, but at some point you are going to reach an amount
that you cannot pay back. Now you have a debt consolidation, maybe more
than one, and you have a whole slew of credit card debt again. Now you
are so far in the hole you will never get out without a bankruptcy.
If you get rid of those cards though, you will not be tempted to use
them to make more mistakes and get yourself further into debt. You have
to be smart about it, because a debt consolidation is not a cure all; it
is simply a band aid on a bigger problem.
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