2. Keep away from bankruptcy, 8 ways to consolidate your debt

Life is strange because as money flows in it quickly flows out. And in juggling finances along with what seem to be great enticements to spend taking a loan, many US citizens find themselves in the sad predicament of bankruptcy.

Intelligent planning and prudent living are ideal but n case there are problems you need not despair there are ways in which you can consolidate debt and steer clear of bankruptcy.

1. There are "non profit consumer credit counseling societies" that help people plan their debt consolidation steps. Experts who work here will help plan a way out of debt and address issues like waiver of late fees and lowered interest rates. They show people how to deal with creditors and plan their finances.

2. Take a home equity loan and club all outstanding debts together in one loan. Of course for this you need to own property against which you can borrow. The financial institution or bank will require your home or property as collateral. In this case you must negotiate for the optimal monthly payments. Be sure to do a comparative study and find the lowest rate. Use sites like Bankrate.com's home equity search engine.

3. Think personal loan. Is there a family member or friend who will trust you and loan you money to tide over the financial crunch. In this case since personal relationships are involved it is important to ensure that you put everything in writing and never take a personal loan for granted. Be sure to pay it back first.

4. Life Insurance policies are another source of funds. You can opt to pay it back or have the loan or withdrawal amount adjusted against the maturity value of the policy. The interests on insurance policy loans are often lower than credit card interest rates.

5. If you have put in long years of service then consider using a loan from your retirement fund to slip away from debt. This will help lower monthly payments and quicken the debt repayment process.

6. Many credit unions lend money and the interest rate is considerably lower and all you need to do to qualify for a loan is to be a member and pay annual fees. Credit unions lend members money for weddings, home loans, illnesses, and other emergencies. Most large organizations have a credit union in place.

7. Consider transferring credit card balances to cards that are offering 0% or low interest rates for limited periods. This is useful only if you can pay off the transferred amounts before the offer period ends.

8. Consider selling assets and settling all debts. Sometimes for peace of mind it is the easiest thing to do. But this step should only be considered when all others fail.

Debt causes illnesses, break up of families, fights, and unhappiness. It is in many ways the demon of the modern world. To stay away from debt you need to learn about handling finances from a young age. And, understand that "nothing in life is for free." Know what the hidden facets of attractive loans and credit cards are. Read in between lines in advertisements promoting dream lifestyles. Plan your finances, the key is to set aside at least 15-25 percent of earnings for emergencies and budget how the rest of the income is to be spent.