News and statistics don’t lie–debt management is a skill that obviously eludes many Americans. Once they fall behind on monthly payments for loans or credit card bills, they just can’t seem to get caught up. These days, people are even buried in debt due to items such as cell phones, because once they go over on their minutes, they end up paying extra fees which lead to delayed monthly payments which then lead to more extra fees. In the case of large monthly obligations like mortgages or school loans, managing debt can be extremely difficult. Many people spend money each month simply to cover the interest on their loans. They are unable to make any dent in the principal, so they can’t move any closer to getting out of debt. People will try to pay earlier or add a few dollars to the checks they write each month, but as soon as an emergency comes up, any extra cash is wiped out.
Using a Credit Counseling Service for Debt Management
A consumer credit counseling service (CCCS) can use several tools to help a person manage debt. Instead of simply looking at what a person owes to creditors, they look at a person’s entire financial situation. Monthly payments, monthly income, and living expenses are just a few of the things a counselor will study to help a person develop a sensible budget. Saving money is a key to managing debt. A counselor will create a strategy that allows a person to put something away each month. That way, if an emergency does arise, money does not have to be taken away from bills to cover it. Through interviews with clients and negotiations with clients’ creditors, a CCCS can help lower monthly payments on certain unsecured loans. Managing debt is an ongoing process that cannot be achieved without having a solid plan in place.
Financial Tools for Overcoming Debt
It is ever more common to hear questions about programs like debt consolidation loans. The main (and wisest) piece of advice centers around the fact that this kind of loan can work for some people. It is still possible to select the wrong consolidation loan and mismanage it. As mentioned above, a solid plan must be formulated and adhered to. The services of a qualified credit counselor can help.
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Consumer Questions about Debt:
I owe around $15,000 in credit card debt. I don’t want to claim bankruptcy. I do not own a house and I am not employed – I am disabled and get SSI. Can you help me?
We are not a debt counseling service but we can point you in the right direction. Please check out our tips to get out of debt and self help. If these do not work then find a service to consolidate your bills.