Debt problems can arise for a number of reasons. Sometimes you accumulate more debt than intended or unexpected events, such as job loss or a death in the family occur. Regardless of why you're having debt problems now, there are several steps you can take to start getting relief.
Create a Budget
To fully determine the health of your personal finances, you need to compare how much money you earn against how much you spend. The U.S. government suggests creating a personal household budget and tracking everything you spend money on each month, including small and insignificant purchases. By seeing exactly where you're spending money, you can make adjustments in your personal budget as needed and put more funds towards paying debts down.
Contact Creditors
If you're not able to make full payments on your debts by the scheduled due date, the government advises you to call each of your creditors and explain the situation to them. Tell each creditor why you're having problems making your payments, and try to get a new payment plan agreement that includes lower monthly bills that you can more easily afford.
Get Financial Counseling
If you have problems creating or sticking to a budget, or your attempts to work out payment plans with your creditors have been unsuccessful, you may find credit and debt counseling services useful. Many financial counseling services provide financial educational materials and help you create a personal budget that works for your lifestyle. Some companies also offer debt negotiation and debt management plans to help ensure you pay the bills on time each month.
Use Caution
The United States Federal Trade Commission strongly advises you to use caution when choosing financial counseling services to work with. Many companies are non-profit organizations, but that doesn't mean they will not charge you a fee for their services. Some companies claim to be non-profit when they aren't however, and others offer financial services that may damage your credit far into the future.
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