Strange but true, financial freedom has almost nothing to do with how much you make or what you know about high finance. It all comes down to three basic principles: get rid of the debt that is shackling you, learn to live below your means, and start investing sensibly and consistently.

Consolidating loans makes sense but only if you can pay a lower interest rate than what you're paying now. This is especially true if you are consolidating mortgage loans. Be aware of your total overall costs to avoid getting deeper in debt than when you started.

Have you ever asked yourself why should I consolidate my bills? The simple answer is to reduce your monthly payments and save thousands in interest costs. Here are a couple of things to consider if you want to see if consolidating loans will benefit you.

No matter what kind of loan you shop for get the very lowest interest rate possible. You always want to pay off a consolidating loan in the shortest amount of time to avoid getting deeper in debt. Plan to pay off all of your debts in three to five years starting with the highest interest rate debt first.

Here are some of the best ways for consolidating loans.

Fifty Utah homeowners thought they found a way to make their mortgages disappear into thin air.

Instead, they found themselves victims of a scam, $3,000 poorer and, in some cases, facing foreclosure on their homes.

Authorities say Dale Scott Heineman and Kurt F. Johnson may have victimized hundreds of homeowners with their claims that mortgages are invalid because -- according to the duo's sales pitch -- the national banking system is an elaborate hoax.

Heineman was arrested May 28 in California and Johnson is still free.

But like many scams, which Utahns seem to have an uncanny knack for buying into, the victims could have protected themselves by using simple common sense.

The most important thing you can do when making the decision get help with your debt related problems is to be an informed consumer. It is absolutely critical to do your research. Do not rush into things; this can cause more harm that good. Prior to signing on with any Debt Settlement company, make sure you ask the following questions and consider their responses:

They still fear terrorism, and most believe that Americans will experience another attack. But when asked, "What are you most fearful of at this time?" only 13.4% said a terrorist attack; 32.4% answered "going deeply into debt," and 31.2% said "being unemployed."

The survey, released today by the bipartisan Partnership for Public Service, finds that 45.1% say they expect to graduate with $10,000 or more in college loans, with 20.6% saying they have more than $20,000 to pay off.

The downside to an interest-only mortgage is that no equity accrues in the home if the buyer isn’t paying any principal. For many Americans, the equity in their home is their single largest financial asset, so taking out a mortgage that doesn’t build equity would seem to be a bad idea. Equity has long been used as a last resort source of funding for emergencies. And yet, with the price of homes rising so quickly these days, many buyers don’t seem to care. Equity can be built two ways – either through paying down the principal or by an increase in the market value of the home. If the value of your home increases, so does your equity, even if you are only paying interest on the mortgage. This is great, so long as home prices continue to increase. But what if prices fall?

There are potential problems with interest-only financing. Interest-only mortgages have variable interest rates. If interest rates rise, mortgage payments will increase. If payments increase beyond the level of affordability, homeowners could be forced to sell their homes. This could lead to a glut in the housing market, causing prices to fall. Owners wishing to sell could find that they owe more money than their home is worth and that they have no equity.

Police are investigating a New York collection agency, where an employee is accused of posing as a law enforcement officer to obtain payment on a debt.

An employee of Alden Associates called a 63-year-old Selma woman and claimed to be a Johnston County Sheriff's deputy, police said. The person ordered the woman to pay a $300 credit card balance from 2003 and said she would be thrown in jail in an hour if she didn’t, police said.

The person also told the woman that she wouldn't see a judge until June or July and would have to "sit in jail" the entire time, police said. The agency also is trying to collect an additional $2,000 in fees for the $300 bad debt, police said.

Officials with Alden Associates have refused to talk with investigators about the incident, police said.

A familial solution
Danielle Rhoades still remembers the taste of debt: peanut butter and jelly sandwiches and tuna fish. That's mainly what she subsisted on for a year -- after living more extravagantly during her first year in New York and racking up a $10,000 balance on her credit card.
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A counselor's care
Vige Barrie recalls the endless phone calls from collectors. They were coming after the $60,000 she owed on more than 10 credit cards. The worst part: She hadn't even been the one saying "Charge it!"
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Crunched by college credit
Thousands of young adults could tell a story much like Paul Canady's: "I got my first credit card by filling out an application at the university center because they were giving away free T-shirts. I didn't think I'd actually get the credit card, and lo and behold, not only did I get it, but it also came with a $2,000 limit . . . In retrospect, that's just absolutely ridiculous.
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The 12-step approach
Owing roughly $100,000 was not Susan's biggest problem. Underlying her distress was the shame of not being able to support herself and her daughter, despite having a doctorate and nursing and medical degrees.

A warning to all those credit cardholders who pay just the minimum amount due each statement: Your monthly bill is probably going to increase, if it hasn't already.

Several major card issuers -- including Citibank, MBNA and Bank of America -- have raised or in the coming months will raise the minimum payment required of their cardholders.

Four days before payday, Christi was in a familiar place -- broke -- and facing so many bills that the lure of emergency cash was hard to resist.

Her old solution had been to walk down the street to a payday loan shop, write a postdated check for $575 and leave with $500 to hold her until she got paid.

But that temporary fix came with a high price -- a staggering annualized interest rate of 391 percent on a two-week loan. She took out one loan to cover another, and soon had six loans with fees of $800 a month.

Many people may still not be aware of an amendment to the Fair Credit Reporting Act (FCRA) that Congress passed last year. This amendment allows U.S. citizens to receive a copy of their credit report, for free, once per year. The plan is being rolled out slowly in order to avoid swamping the system, but people living in the West and Midwest can receive their credit reports now, and everyone will be able to obtain a free credit report by September of this year. Those seeking a copy of their credit report should watch out, however, as not everyone who promises a “free” credit report is actually delivering one.

These free credit reports may be obtained through the official Website: annualcreditreport.com. Additional information is available at the Federal Trade Commission Website at www.ftc.gov/credit. Obtaining a copy of your credit report through this site is easy, and only requires your name, Social Security number, date of birth, and address. That would seem fairly straightforward, but there are many companies, some legitimate and some not, that are interested in attracting the business of those who seek copies of their credit report, and scams are flourishing.

Do you have experience, good or bad, with a credit counselor or consolidation firm that you'd like to share?

I've heard that credit card companies don't consider someone in danger until they've accumulated debt in the order of 3 times their annual salary, which is mind-boggling. I'm nowhere near that (nowhere near my salary, thankfully), but I'm irresponsible enough to have accumulated some high APRs on three cards. I've been paying down my cards for a couple of years, but as soon as I get some breathing room on one or two of them they immediately decrease my limit. (I don't use any of them, I only use my AmEx which I pay off religiously.) Calling them to ask for lower rates, etc, has no effect,

It's time for me to get some help. I'm not drowning, but feeling the current a bit. I know this type of action is likely to be a knock on my credit rating, but better a small knock now than a big crash when an emergency comes along and I have no cash to keep paying down debt.

I know the theory (someone, on my behalf, consolidates my debt into one payment), but most of the firms that advertise seem slimy (non-profit doesn't mean they aren't in it for the money). Any first-hand experiences you can pass one? Any companies/individuals you can recommend?

1. Interview several agencies to choose a qualified credit-counseling service.
2. Ask each agency if it is a nonprofit organization, what services it offers and how much the services will cost you.
3. Find out if its counselors are certified and if the agency services are confidential.


4. Inquire as to how soon a counselor can take your case.
5. Request that the agency send you information about its organization and services. Any reputable credit-counseling agency should send you free information. If not, consider this a red flag and go elsewhere for help.
6. Check with the attorney general's office or a local consumer-protection agency to find out if consumers have filed complaints about the provider you are considering.