Debt Management Solutions

Written by Jill Morrison
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Debt management solutions are available through settlement companies. They generally offer many services including consolidation, settlement, and counseling. Many Americans need help to understand and manage their debt. Most people get their first credit card early on, before learning the basics of budgeting and long term financial planning. Obviously, this can lead to major credit problems down the road. Counselors provide education and offer a plan to erase debt on a strict time schedule.

Details of Debt Management Solutions

Many companies offer a special debt management plan. Individuals send just one check each month to the management company. They then use this money to pay all creditors. The individual pays a fee and their credit report will state, "managed by a credit counseling company." Some of the warning signs for needing credit counseling are having multiple credit cards with long outstanding balances, having trouble paying monthly bills, and having difficulty living on a budget.

Finding a reputable company for debt management solutions is important. People can check for consumer complaints through the attorney general's office and the Better Business Bureau. Since fees vary, they should be compared and checked before signing an agreement. If a debt management plan is agreed upon, it should be read carefully and understood thoroughly. Although some companies are understanding if a consumer needs to negotiate payment amounts or dates from time to time, others are not. Clearly, it is important to know this before signing anything.

Debt management advice includes setting financial goals each month and learning to spend only when money is available. A check card is a better alternative than a credit card because funds are taken immediately from checking accounts when they are used, and it is not necessary to carry cash. Counselors will advise most people to stay active without spending money. Outdoor activities and working out are effective options. Settlement companies offer support and encouragement to those needing debt relief.

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