Consolidation Counseling for Financial Help for Credit Debt

If you are drowning in debt, you are probably looking for a way out of your dilemma. Simply digging your way out of your debt problem is not enough--to stay debt-free for the long term you will need to get to the heart of the problem. That means that any effective debt management and debt consolidation program should also include a strong element of financial education. By becoming an educated consumer you can eliminate your debt problem--now and in the future.

Preconsolidation Counseling

Taking out a debt consolidation loan can be the best choice for those who are saddled with unpaid bills resulting from a job loss, unexpected medical expense or other curveball. But for those with ongoing debt struggles, a simple loan may not be enough. Before taking out any type of debt consolidation loan, it is important for consumers to educate themselves about the wise use of credit. Enrolling in a financial education course is one of the best ways for consumers of all ages and income levels to get a handle on their debt problems and remain debt-free.

Understanding Debt Problems

One of the most critical parts of any credit counseling or debt management plan is a focus on the causes of debt and how to avoid the long-term debt trap. To deal effectively with debt problems, consumers will need to learn some basic financial skills, such as creating a budget, managing credit card debt and saving for the future. Without a solid financial foundation, many consumers end up on a debt merry-go-round, paying off one set of credit card bills only to rack up even more debt a few months later.

Creating a Plan

To get a handle on debt, consumers will need to create a realistic plan to get themselves out of debt, and that means making a list of everything that is owed, along with the interest rates and required monthly payments. This important step often requires the help of a professional, and consumers may want to look for a nonprofit agency such as the Consumer Credit Counseling Service. These nonprofit agencies can help consumers understand their debts, analyze how they got into debt, and make a plan for getting out of debt and remaining debt-free.