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How To Reap The Full Benefits of Debt Advice

Posted December 7th, 2011 in Debt by Jeremy Waller

Sample Average Monthly Budget For a Single Person Or College Student

This following is a guest post from one of our readers.

It goes without saying that we could all use a bit of help with our debt. It also goes without saying, that if you’re looking for quality, it comes at a price. There’s a world of difference between merely browsing the web for some trivial information and getting truly professional debt advice. In fact, it could make that decisive difference between eventually having to file for bankruptcy and being able to get back into the black again.

If the costs involved with debt advice may scare you off, you’re not alone. And yet, when working with the right company, debt advice may even end up saving you money in the end. What you need to understand is that debt advice is a task that requires your active participation. If you follow these four steps rather than sitting by idly, you are sure to reap the full benefits of debt advice

1. Be prepared

Before you even call a debt management agency for the first time, you should be able to have at least a basic knowledge of the topics and terminology surrounding debt. There are some good introductory articles to be found on the web and your local library should at least have a few books on the subject as well. Make sure to perform a thorough check on your financial status: How much do you have in cash across all of your accounts? Are there any notable assets to speak of? Do you have debts with just one or multiple creditors? By researching these questions, you will quickly discover your knowledge deficits and weak spots.

2. Start reducing your debt – right now

No one is keeping you from reducing your debt today. So why don’t you just go ahead and do it? Check all of your current expenses for their necessity. Evaluate your income situation and how to improve it. See if you can sell off some items to inject cash into your account. There are always several opportunities to free money to pay off your debts – and you should grab them.

3. Find the right debt advice company

After you’ve taken all of these steps, it is now time to start speaking to an expert. Debt management companies will be able to use all of the information you’ve gathered to suggest ideas you haven’t come up with yet or to show you options you didn’t know existed. Most of all, they’ll be able to address your situation personally and without bias. Choosing the right agency is vital in this regard. Before speaking to anyone, take a look at the company’s website: Are they making any unrealistic promises, such as ‘getting you debt-free in no time’? Has the company been awarded for its service level in the past? Are they part of organisations promoting fairness and openness in the industry? These are points to consider before you start talking to them.

4. Ask questions

A debt advice session with the right company is almost certain to benefit you. But it will be even more useful if you don’t just listen to what your specialist is telling you, but if you ask her or him questions. This will, on the one hand, provide you with a clearer picture of whether the company is really out to help you. The more personal and helpful the answer, the better. On the other, it will allow you to arrive at your own conclusions and take decisions as an equitable partner. Debt advice is not just about providing information, it is about empowering you to live your life just the way you want again.

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8 Responses so far.

  1. These are great tips! When my husband and I decided to take control of our finances, our first step was reducing our monthly expenditures, paying off our consumer debt, and increasing our savings.

  2. Aloysa says:

    Tips are good but really why would you want to look for a business to get out of debt when all you need to do is to buckle down and start paying it down?

    • Jeremy says:

      To you or me, it may sound silly to pay someone to tell you how to get out of debt. There’s a thousand different resources online (including your site and mine) that tell people how to get out of debt. But for someone who is totally overwhelmed or has a complicated situation – being able to sit down face-to-face with a financial adviser can be tremendously valuable.

  3. I love the be prepared statement. If possible, you want to come with some questions and learn about different options. It’s also a good way to vet debt counselors. If they aren’t able to explain and provide good arguments for one path over another, it is probably a red flag that you should find a different professional.

  4. Charles says:

    Another thing that can help out a lot is 0% balance transfer credit cards. These days, some offer 0% on up to 2 years! that’s 2 years of interest free after initial balance transfer fees of 3-5%. That could really be a key role in reducing debt.

  5. Sometimes just taking that first steo is the hardest but getting started by organizing statements can go a long way to getting out of debt.

  6. I am not in favor of debt management companies, you can take care of your debt problem yourself. Still good advice for people need them any way.

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