When it comes to debt management, there is much debate over the efficacy of debt consolidation. For some people, there’s great success, while others have a harder time once they see the price tag on their consolidated loan.

However, the question remains: does debt consolidation work, or is it just a way to feign financial stability? To answer that question, here are some pros and cons for you to weigh if you’re contemplating debt consolidation:


  • Rather than having to pay on several different credit cards, loans or whatever else, you’ll only be paying on your consolidation loan, meaning only one monthly payment to worry about. This not only helps you keep your finances organized, it also saves you money in the long run.
  • Since you’ll have more time to pay off your consolidation than you would any credit cards or other loans, you’ll have more time to build up your credit score. Although you’ll be paying monthly for a little longer, you’ll be securing a better financial future for yourself.
  • Instead of having multiple credit cards or other outstanding debts collecting interest all over town, debt consolidation only requires you to pay one interest rate on your loan. This starts saving you money almost immediately, and over time, allows you to get a better handle on your finances.

There are plenty of other benefits to choosing debt consolidation, but of the many reasons to do it, there are an equal amount of reasons not to. Although the pros listed above are promising, there are definitely some cons that go along with it.


  • Having more time to pay off your consolidation loan and improve your credit score may sound like a great idea, but it can potentially cost you more money in the long run. Depending on how long it takes you to pay, you can run the risk of racking up quite the bill.
  • Debt consolidation, when done correctly, can do great things for you financially. However, it really is only the first step in a long series of steps you have to take to actually get out of debt.
  • Similarly, debt consolidation doesn’t get you out of debt. In fact, all it really does is move your debts to a different place, which is one of the main criticisms it receives. It does make payments and such a little more manageable, but in all reality, it doesn’t do very much.

As you can see, there is a very fervent, very ongoing debate about whether or not debt consolidation works or not. But at the end of the day, the decision really is up to you. You can read all the articles in the world, but only you can decide if debt consolidation is worth it. But if you’re still a little skeptical, definitely consider a consultation with a financial advisor or banker and they’ll be able to sort you out.

Frank Mccourt is both a financial advisor and an aficionado for the written word. He loves sunsets and long walks on the beach, and he also loves burritos, because they’re awesome.