New Delhi, June 19 -- Are you keeping track of multiple high-interest debts, EMIs or credit payments? Balancing multiple repayment schedules each month can be stressful and expensive. This is when personal loans help consolidate debt, and may come into play. But is it a short term solution or a good idea? Let's break this down further.

Debt consolidation is when you combine multiple debts; credit cards, personal loans and overdrafts into one loan with one monthly payment. This is typically done by taking out a personal loan to pay off any current debts. This gives you a simplified number of accounts, a single date to meet, and may save in interest costs.

Because a personal loan is a type of unsecured credit, you do not have to offer col...