To a person in over his head in credit card debt, debt consolidation may seem like a good deal: Combine all of your credit card debt into one monthly payment at a lower interest rate. In practice, however, debt consolidation often leads to more debt over a longer period of time.

The problem with debt consolidation is that it doesn’t solve the underlying problem of too much credit card debt. Your monthly payment will go down with debt consolidation. By spreading out the payments over a long period of time, however, you end up with a burden of debt that makes it difficult to keep up with your other bills. Eventually, credit card debt creeps back.

For many people, filing Chapter 7 bankruptcy is a better option. Bankruptcy allows you to discharge 100 percent of credit card debt, medical bills, and many other types of unsecured debt. When you file bankruptcy, you can get a fresh financial start.

Many people who try debt consolidation end up spending money they could have saved if they had filed bankruptcy sooner. Many people dip into retirement savings, take out second mortgages, or skip car payments in attempt to pay off credit card debt. Unfortunately, this amounts to robbing from yourself in order to pay the credit card company.

While debt consolidation can lower your monthly payments, the lower payments are the result of extending payments over a longer period of time. You stay in debt longer, and this leads to financial stress over a longer period of time.

The Reed Law Firm in Columbia offers a free initial consultation to determine if bankruptcy or debt consolidation is a better solution for your debt problems.