Dave Says: Do Not Consolidate Your Debt

by | Sep. 18, 2014

Mormon Life


Dear Dave,

I’m 38, single and I have three kids. I make $65,000 a year and have $34,000 in debt. I’m about to get remarried, and my new husband will make about $100,000 a year. Should I take the $34,000 and put it on my mortgage to consolidate it?


Dear Leslie,

Please don’t consolidate this debt. If you guys are about to get married you need to learn, as a couple, to make debt a thing of the past and live on a written, monthly budget. Think about it. Once you’re married, your family will have a great income. You could really push and attack that debt, and have it paid off in no time.

As a new couple, you need to learn to set goals and work on things as a team. Budgeting is a great exercise for any marriage, but it’s an especially good thing for newly married couples to learn to do. A budget isn’t just controlling your money. It’s two people sitting down together and sharing their hopes and dreams for the future. Not just that, it’s the process of making an actual, workable, written plan that will help make these dreams become reality.

Don’t do a debt consolidation, Leslie. Debt consolidation is nothing more than a "con," because you think you've done something about the debt problem. But the truth is the debt is still there, as are the habits that caused it. All you did was move it around.

You can't borrow your way out of debt, just like you can't get out of a hole by digging out the bottom!


* Dave Ramsey is America’s trusted voice on money and business. He has authored five New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover, EntreLeadership and Smart Money Smart Kids. The Dave Ramsey Show is heard by more than 8 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.

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