Debt Management Programs: Are They for You?
If you’re facing significant financial obstacles, you may have recently considered enrolling in a debt management program. Here are answers to debt management questions that you may be asking:
What is debt management?
A debt management program is an action plan that is tailored specifically to your circumstances in order to help you get out of debt. If you have trouble paying bills, debt collectors hounding you, financial stress, and the fear that you are becoming overwhelmed by your debts, then you may need to consider the pros and cons of debt management programs.
What are the advantages?
The most immediate benefit of enrolling in a debt management program is that all that aggravating debt collection activity by creditors, such as phone calls and letters, should come to a stop. Through debt consolidation, your payments are simplified so that you no longer have a nightmarish array of bills to keep track of. Your creditors may even reduce your monthly payments or make better repayment arrangements if they feel this will ensure that they can collect. Interest fees and late fees are also reduced or eliminated.
What are the challenges?
For a debt management program to work, your creditors will have to agree to participate. If they don’t, then it can derail the program or reduce the effectiveness of the entire process. For obvious reasons, most debt management programs won’t allow you to take on any new debt, which can be quite an adjustment if you are used to a lifestyle of living beyond your means. You must also work to develop the discipline to stick with the program and make payments on time, a change that could be uncomfortable. Remember, a debt management program will only work if you make it work.
What are the end results?
The long-term benefits of debt management outweigh the challenges; debts that once seemed out of control can be made manageable. The hopeless cycle of debt and despair will finally be broken and a realistic timetable for financial freedom can be established. Indeed, of all the advantages of debt management programs, none are perhaps more important than the restoration of your peace of mind.
Debt management programs are not for everyone, but for those suffering severe financial stress due to excess debt, they can be a genuine life saver. The program is designed to address your specific situation, using all the tools from negotiating, reorganizing, debt consolidation, and counseling to bring order and stability to your financial world. Never give up hope for your financial recovery until you have consulted with debt management professionals about whether a program would work for you.