Some people can climb out of debt through simple budgeting. They determine how much they spend each month, and then look for ways to cut down on that spending. Savings they find go right toward their debt, and over time, that debt starts to fall.
Other people may find that budgeting simply doesn’t provide enough help. Perhaps their budgets are so tight that no more savings can be found. Or perhaps they’ve lost their jobs and seen a dramatic reduction in their income, with no similar dip in their debt.
People with insurmountable debt may find credit counseling programs or debt settlement programs to be incredibly helpful. You can read more about these programs by clicking here. These programs aren’t without drawbacks, however. Some programs can be expensive, and sometimes help can be months in coming.
Knowing whether or not you need help is a prudent first step. If any of these 5 signs apply to you, it’s time to seek outside help to get control of your debt:
- You use one credit card to pay off another. Trading credit from one card to another is a bit like treading water. You’re not moving ahead with paying down your debt. You’re just shifting it from place to place.
- You use your credit card to pay for necessities like gas and food. If your monthly budget doesn’t leave you enough room to pay for the items you need to live, you need help to rework your budget and find the funds that can help you survive.
- Thoughts of your debt and your financial situation keep you awake at night. Long-term stress can be incredibly damaging to your health and it can ruin your relationships. If you can’t see a way out on your own, a professional may be able to guide you to a decision you’ve not considered before.
- You have no idea how much you owe, and you’re too afraid to find out. Living in denial is not a helpful strategy when it comes to dealing with debt. If you don’t know how much you owe, you can never put together a realistic plan to help you reduce that amount. A credit counselor can help you dig up those figures and put together a realistic plan.
- The phone is always ringing with calls from collection agencies. Once your financial situation has progressed to the degree that collectors are hounding you, it may be much too late to deal with the situation on your own. Sometimes it’s best to admit defeat.
There are multiple credit counseling and debit repair agencies available, but make sure you research the company in detail before you sign up. Never work with a company that asks for fees in advance. This practice is illegal, and companies that ask for upfront fees may be trying to trick you.
Photo courtesy of Michal Marcol: http://www.freedigitalphotos.net/images/view_photog.php?photogid=371