In order to get out of credit card debt for good, it is important to manage money and control spending. According to an article by timesunion.com, Americans racked up more than $50 billion in credit card debt just in the last quarter of 2015. For people who are still behind on paying off holiday debt or who want to start spending for the next season, debt counseling is a sensible answer. With the help of a credit counselor trained and certified in helping consumers overcome personal finance challenges, you take back control. Getting out of credit card debt is simple with the right tools. A debt management plan is one easy way to consolidate debt. Experts offer other suggestions and practical measures to overcome a debt problem as default rates rise and it becomes more difficult to obtain credit.
Sticking to a budget
One positive measure you can take as part of debt counseling is to stick to a budget. A credit counselor encourages you to take a hard look at your spending. Rank your expenses with a debt management payment at the top of the priority list so you get out of debt for good. In addition to paying off debt, contributing to a savings or retirement account is also important. To control spending, try using a spending diary to record all purchases.
Setting up a safety net
Most people have smoke detectors in their homes and air bags in their vehicles. Having a financial safety net is another measure to protect your family. If you aren’t sure how much money to put in an emergency fund, bring it up during a debt counseling session. Based on your income and credit card debt, you can figure out what you can comfortably afford to put aside. Saving money gradually will prevent any shortfall when paying bills.
Boosting your credit
While participating in a debt management plan, you improve your credit score over time. Your credit score won’t recover overnight. At the same time, creditors like to see you paid off credit card debt. A credit counselor motivates you to pay off debt without taking out any new credit cards. You can control spending by taking away the temptation to rely on credit cards. Try using cash only as you are paying off credit card debt.
At Christian Credit Counselors, we provide debt counseling to consumers with credit card debt they want to manage as well as pay off. Talk to us about how we can lower interest rates and set up automated monthly payments on a debt management plan. For more information on debt counseling, please contact us.