By Brian O'Connell
With a college diploma comes a real world lesson in one of life’s most demanding subjects – debt.

On average, college students graduate owing $24,000 in student loan debt. That’s a hefty sum and some college grads, especially those who can’t get a good job, just can’t keep up with the monthly payments.

To those student loan borrowers, a loan consolidation could be an option.

Student loan consolidation enables hard-luck borrowers to lock in a lower interest rate, and presumably lower monthly payments. Interest rates are low right now, so if you borrowed money to go to college at 7% and can lock in a lower rate at 5%, chances are you’ll see a reduction in your monthly loan payment. To check how well you’ll do if you consolidate, use BankingMyWay’s Loan Consolidation calculator.

Conversely, getting a loan consolidation could well mean you increase the overall amount of your loan. That’s because when you roll your debt into one package, you get longer repayment terms, which translates into higher total loan payments. So while you may gain shorter monthly student loan payments, you’ll likely pay more on the back end.

But if you have multiple school loans, like many law or medical students do, a loan consolidation still makes sense. With a consolidation, things are more efficient, loan management-wise -- you’ll only have one monthly bill, one lender, and one financial target every month to aim at. It should also help your credit score, as you’ll have fewer “open” accounts on your credit report.

If you do consolidate, be prepared to clear some hurdles. Lenders usually require the original loan to be from a credible lender, be over $10,000, and you must not be in default on your loan payments.

If you run into trouble getting a loan from a major bank or lender, try aiming for a loan from the non-profit sector. There are plenty of good loans in the non-profit world. Visit the Education Finance Council for a list of non-profit vendors in your state.

In the end, if you can manage to keep paying your student loans, even if it is a bit of a hardship, keep paying. You’ll retire the loan more quickly and save lots of money in the process. But if you just can’t keep up, or are burdened with multiple student loan payments, a student loan consolidation just might make sense.

— For more ways to save, spend, invest and borrow, visit MainStreet.com.