Basically, what a debt consolidation plan does is to well, consolidate your debts. This is a program where you get all your various credit cards together, you arrange for them to be paid by one central company that takes care of paying them and then you pay that one company. It can be done in several ways:

• New credit card. This is less often done these days, but some credit cards will still let you consolidate debt onto them from other cards. The key here is that you cut up the other cards so you don’t get into trouble again.

• New mortgage. Again, with the problems in the housing markets, this is harder to find as well, but you can refinance and get the money to pay off your bills, even today. Just be sure that you follow the advice above and cut up the cards so you don’t end up back where you were, but with a larger mortgage to boot.

• Debt Consolidation Counselors. These guys will negotiate on your behalf with you credit cards and other creditors and they will arrange a lower payment for you. It doesn’t always work though and you do need to watch out for con men. However, in general, this is a great choice and probably the best choice if you find some with a reputable debt consolidation plan.

Stop using your credit cards. Yes, it’s tempting to whip out the plastic and pay for the groceries, but all you’re doing is adding to debt that you need to figure out how to pay for later.

Make a list of monthly expenses. Basically, what you need to do is to keep careful track of what it is that you’re buying. It’s amazing how the little things that you think you “deserve” can make massive holes in your budget. For example, even though that $4 latte at Starbucks sounds like it’s a nice deal, the reality is that they add up very quickly and will get you into trouble. Even the candy bar at work to help you get through the day is an expense that can be cut. Look carefully at everything and allow nothing to be sacred. That said. . .

Don’t make yourself miserable. Yes, you need to follow these tips on debt consolidation in order to get yourself out of debt. But if you cut too far, you’ll make yourself so miserable that you’ll end up like someone on a diet who binges because they just can’t take it anymore. Instead of a candy bar every day, try a candy bar once a week. The latte at Starbucks can be a once a month indulgence instead of a daily one.

You don’t need to use a debt consolidation service in order to get your bills renegotiated. If you call your credit card company and explain that you’re having problems with paying your debt, they will generally listen and try to work with you on getting you a payment plan you can manage.

If you choose to use a service for debt consolidation, make sure they’re legitimate. Ask questions, beware of claims that are too good to be true and check with the Better Business Bureau to see if complaints have been filed against them.

Good luck. I know the economy is tough right now, but if you follow these debt consolidation tips, I do believe that you can get through it.