Today I wanted to cover the subject of debt consolidation. What is it? Should you do it? and if so, then what are the options available to you?

Links and Resources

• Top Tools and Resources for Financial Independence (for Canadians): Sign up anywhere on www.BuildWealthCanada.ca for a free guide on all the top tools and sites that I've personally used to help us achieve financial independence in our early 30s. They're also what we use now to optimize and manage our finances, and ensure that we're paying the lowest fees while getting solid returns on our investments.
• Kornel's investing course with free sample lessons at www.BuildWealthCanada.ca/invest

Questions Covered

1. What does it mean to consolidate your credit, and in what circumstances should somebody consider doing this?
2. A common argument against credit consolidation services is that they don't solve the underlying issue. In other words, somebody might consolidate their debt which frees up space on their credit cards or line of credit, and then they just end up taking on more debt since they haven't changed their lifestyle and habits to live a debt free life. How can someone prevent this from happening to them?
3. Since you deal with a lot of individuals that have gotten into significant debt and are struggling to get out, what are the most common mistakes that you see people make that get them in this situation in the first place?
4. What are you thoughts on the use of emergency funds? Some experts suggest keeping it in cash, while others suggest having a line of credit for emergencies and using any available cash to pay off the debt. Where do you stand on this debate?
5. After paying off any high interest debt, what are your recommendations on paying off student loans and the mortgage vs investing the money for retirement?
6. For somebody that wants to see if consolidating their credit is right for them, what is the process that they get taken through with you from beginning to end?