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Debt Management and Credit Scores Debt Management Agreements: The Pitfalls
Credit counseling is not a very well-regulated industry today. In the past, credit counseling was operated more like a social service rather than as a business designed to make a profit.
The industry was known by the general term CCCS (Consumer Credit Counseling Service) and operated under the general guidelines of the NFCC (National Foundation for Credit Counseling).
The lay of the credit counseling landscape has changed. As more and more consumers find themselves deeper and deeper in unsecured debt (think credit cards), more and more for profit credit counseling services have sprung up. Some of these services are very good and very fair, but be aware that not all of them are.
Some credit counseling services are good, others are bad, and then there are those that are just evil.
1. The debt management service that you choose should be a member of the BBB (Better Business Bureau). You can check with the BBB to see if the company has a good record and if there have been any complaints filed by others. Membership in the NFCC (National Foundation for Credit Counseling) or AICCA (Association of Independent Consumer Credit Counseling Agencies) is also acceptable.
2. If the debt management service promises you that it will take 20 minutes or less to solve all the financial problems, you need to run as fast as you can. They are referring to THEIR financial problems and not yours. It takes time and effort by a debt management service to help with your financial problems and get you the best deals possible.
3. Be certain that the debt management company can help with all of your unsecured debt and don't just deal with a few companies. Half a fix is often worse than no fix at all.
See Also:
Debt consolidation using your home’s equity.
| Easy Credit and Debt Management Debt Management and Health
There aren't many things in life more stressful than having bills due that you cannot pay, a mail box full of second, third, and final notices, and bill collectors calling day and night.
Stress itself is a health issue and can also cause many other health issues. Financial health has a direct connection to physical and emotional health. Financial problems lead to relationship problems which lead to emotional, mental, and physical health problems. Controlling your financial life is important not just from a financial standpoint, but from the relationship and health standpoints, as well.
Of course, I am not suggesting that you can avoid every health problem, all stress, or that your relationships will flourish if you just stay in control and manage your debt well. I am saying that you can avoid a lot of unnecessary grief by making a plan and managing your debt in order to prevent stress and all of the problems that stress can and does cause.
Make a plan -- think budget. Take control of your financial situation. A written plan takes the pressure off. You don't have to remember things. You simply use your budget and your financial plan.
Pay your bills on time and in full each and every month. When you conduct your financial life in a well-planned and responsible manner, you will find that other areas of your life become better organized and better functioning as well.
It isn't easy to take control in midstream, so to speak, but it can be done. The first step to relieving some stress in your life is to find a budget form on the Internet or in a brick-and-mortar store. Follow the directions that will be provided.
As you take control, you will relieve your stress and improve your physical, mental, and emotional health as well as your financial health. |
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Not really! It would be nice, of course, if everybody suddenly became excellent debt managers and such nasty little things as late notices and harassing phone calls by bill collectors became things of the past.
If everybody only took on debts that they could pay on time and in full each and every month, the debt management companies and the consolidation loan companies could just fold their tents and slip away into the night. That hasn't happened, and there isn't any indication that it
is going to happen in the near (or far) future.
More and more people are finding themselves in financial holes more and more often today. When discussing this situation with a group of my peers, the consensus was that instant gratification and less than adequate financial education are the two principal causes.
In days gone by, parents taught their children about financial responsibility. Children were given small allowances and then instructed how to spend it. They were required to save 10%, give 10% to charity, and to make sure they had enough to cover their necessities until allowance day came around again. If the kids ran short, they were not allowed to dip into their savings. They simply did without until allowance day. Mom and dad did not pony up to cover the shortfall if junior had blown his allowance on ice cream.
There was no such thing as instant gratification. If a kid wanted a bicycle, he had to save for it. It didn't just appear because he begged mom and dad for it.
It really is time for parents to again begin teaching children about financial responsibility and debt management, and the schools need to do their part as well. We have become a nation of borrowers without a plan to repay our debts. |
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Debt Management and Interest Rates, Debt Management Wiggle Room
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