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Debt consolidation can work with the proper financial habits in place
By Angela Hawke on Apr 12th, 2010
Bad financial habits may have led some consumers to be behind in their bills, leaving many to try and find solutions to their problems.
A recent post on CNN.com's NewsRoom blog notes debt consolidation may be an option for troubled consumers. One of the advantages of debt consolidation is it can help lower the amount of interest a person pays on their debt over time.
However, debt consolidation won't help a consumer unless they adjust their spending habits and make sure to live within their means. Otherwise, they'll just accrue more debt, which will nullify the benefits they could get from consolidation.
"The truth is debt consolidation can work if the plan is right, if you are educated about your options and determined to change your money mindset," the post said.
One of the most basic ways to keep track of spending and stay out of debt is to formulate a budget. Consumers should sit down and calculate their monthly expenses and then compare it to their income.
If there is a shortfall, people should consider cutting down on discretionary spending, such as entertainment expenses or going out to eat. They may also consider carpooling or reducing their cellphone plans.
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