I see this time and time again.
People decide to consolidate credit cards in order to lower their monthly payments, and by the way, this is a great idea.
It really is.
In fact, I applaud you if you have come to the realization that you need some help, and therefore have turned to a debt consolidation company in order to get this unsecured debt off your back.
I know it does tend to weigh you down.
You almost feel like you are a slave to this debt, don't you? I've been there, totally know that feeling.
Anyway, the problem is that so many folks have this really great plan in mind, they find the debt consolidation company of their choice, do their research, go meet with the company rep (or fill out the forms online), and voila, they have lowered their monthly payments quite a lot and, instead of writing five or six checks every 30 days, they only have that one convenient payment.
So what is wrong with this scenario? Nothing at all if you are not planning to open more accounts.
But almost invariably, once people get straightened out with their finances, they decide, oh, I'll just open this one account with this company and it will be for emergencies only.
After all, everyone needs one credit card, right? It would be okay if you actually then only used the card for real and true emergencies.
But as time goes on, it is tempting to pull out the card to buy that new laptop or the cool iPhone you always wanted, or a new Tivo.
Or maybe you just rack up some small amounts little by little with small piddly things.
Either way you eventually max out the card, then start the process all over again with a new one.
Then in the meantime you are still paying the debt consolidation company but now you have added even more bills so you are back to square one but worse off than you started.
So don't make the move to consolidate credit cards unless you plan on kicking that habit.
Otherwise you will be doing yourself a lot more harm than good.