7 debt consolidation secrets that will help set you on the right path.

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1. Cut Back on Credit Cards
Banks love to send offers for new credit cards to consumers, and mailboxes overflow with low-interest credit cards—even no-interest—“unbeatable deals.”

This doesn’t mean you should apply for them and risk running up large bills. The first step in debt consolidation thinking.

One should have no more than two or three credit cards. We would recommend a Visa or MasterCard, followed by an American Express credit card. Having two or three different cards will allow you more flexibility when utilizing credit, as some companies do not accept one or the other.

2. Understand the Consequences of Breaking Rule #1
Even if you have excellent credit and zero debt, applying for too many credit cards can damage your credit rating. Consolidate your debt by keeping a tab on your spending and draw a threshold.

Generally, inquiries for a new credit can affect your credit report for up to two years. Having too many credit cards—whether carrying balances or just high amounts of available credit—can negatively impact your credit score. Banks will look at your credit based on what you currently owe and also what ability you have to immediately incur additional debt.

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3. ConsolidateYour Debt and Stop the Spending
To minimize or avoid debt, monitor your monthly expenses—and halt spending when your budget starts to get tight.

An additional reason to limit the number of credit cards you have is to prevent the possibility of not being able to keep track of all of the expenses you have incurred, which may make it difficult or impossible to pay them off each month.

If you reach that point, follow one simple debt consolidation rule: “No more charging. No matter what.”

Commit now to discontinue the use of credit cards. In fact, cut up the credit cards you have, call the companies, and close the accounts. If you must have a credit card for work, try a debit card. These are widely accepted, and the funds are pulled directly from your checking account.

Keep in mind as you consolidate debt - apply for another credit card until you can pay off all balances due and be 100% debt-free.

4. Pay More Than You Owe
A golden rule of debt consolidation. Once you fully understand the monthly minimums you owe on each debt, add 5% or 10% to your total payment, if possible.

The addition is not mandatory, but it will dramatically improve the success of your debt-reduction program.

5. Stay the Course of Debt Consolidation
Continue to pay 5% to 10% more on each debt until all debts are completely paid off. Even if your minimum payment requirements decrease as your debt diminishes, keep making the same payment.

6. Consolidate Debts and Do the Math
Before you say, “I just can’t do this,” it’s worthwhile to see how consolidating debt plays out in real dollars.

“If you owe $2,000 on a credit card with a 21% interest rate, and you make only the minimum payment each month, you will owe on this account for approximately 19 years—and pay a total of $6,725.64 in principal and interest. The steps discussed will help you pay off the debt in a fraction of the time. The emotional commitment to make this plan work may not be all that easy, but using this program—even without the additional 5% or 10%—will allow you to pay off the debt in about 8.5 years, and you will save approximately $2,387 in interest.

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7. Turn the Tables— Earning Money with Debt Consolidation
If you pay off your $2,000 debt in 8.5 years (versus 19 years of minimum payments), you will have 10.5 years to place that monthly minimum payment in an interest-bearing bank account, retirement account or other investment.

Debt consolidation interest is a magical tool. Creditors use it to their advantage all the time. It can also work in your favor if properly implemented into the right program. If the steps mentioned above are taken, it won't be long before consolidating your debt is working for you, instead of against you.