Does consolidating your debt work

Try a do-it-yourself debt payoff method instead, such as the debt snowball or debt avalanche.

If the total of your debts is more than half your income, and the calculator above reveals that debt consolidation is not your best option, you’re better off seeking debt relief than treading water.

» MORE: Follow these 3 steps to pay off debt Two additional ways to consolidate debt are taking out a home equity loan or 401(k) loan.

However, these two options involve risk — to your home or your retirement.

» MORE: 4 ways to consolidate debt Use the calculator below to see whether or not it makes sense for you to consolidate.We compiled everything you need to know about consolidating debts, and getting a debt consolidation loan, to help you decide if it’s right for you. It involves taking out a new loan or line of credit large enough to cover the debts that someone owes.Then, their outstanding debts are paid off and the person begins paying the new loan or line of credit, typically at a lower rate or with an easier payment schedule. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free. Our partners cannot pay us to guarantee favorable reviews of their products or services. " At Nerd Wallet, we strive to help you make financial decisions with confidence. Debt consolidation rolls high-interest debts, such as credit card bills, into a single, lower-interest payment. We believe everyone should be able to make financial decisions with confidence. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research.

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Consolidating your debt is especially helpful if you struggle to keep track of your payments.

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