You don't have to spend all the UTXOs you have to make a transaction.
Let's say you have 2 UTXOs and they are both assosicated with the same address.
One is worth 0.2 BTC and the other one is worth 0.3 BTC. If you want to make transaction paying 0.1 BTC, you can use each of UTXOs you want. You can also use both UTXOs.
I'm very much interested in this, been using electrum wallet for a while now and haven't seemed to observe this feature. Would you please specify the wallets that incorporates this feature and how to locate it.
Secondly, I have the intention of consolidating all my UTXO's to a single one in my wallet. Normally, I send them to my second wallet to consolidate it and pay a fee in the process. Is it possible to merge them all into a single UTXO in the same wallet?.