Debt Consolidation: Solution or Temporary Fix? Unpack the Pros and Cons

• Debt consolidation replaces multiple debts with one larger loan, simplifying payments and due dates.
• It's beneficial when high interest is the main problem, allowing replacement of high-interest debts (e.g., credit cards) with lower-rate personal loans.
• Consolidation becomes dangerous if underlying spending habits aren't addressed, often leading to new debt layers.
• Beware of extending loan tenure just to reduce EMI, as it can significantly increase total interest paid over time.
• Success hinges on behavioral change: closing or limiting paid-off credit cards is crucial to avoid relapse.