Debt Solutions

Consolidation is just one of the many solutions available to consumers in debt. Learn more about credit counseling and debt management plans here.

Credit Counseling

Credit counseling is one of several ways you can become a debt free woman. Credit counseling services are usually nonprofit organizations that can help you deal with your creditors and create a workable budget. Usually, credit counseling is intended for people who aren't disciplined enough to make a budget and stick to it, can't arrange a repayment plan with their creditors, and/or can't keep track of ever-increasing bills. A common misconception about credit counseling services is that because the organization claims to be nonprofit, that the service will be legitimate, affordable, or even free. This is seldom the case. In fact, many credit counseling agencies charge very high fees, which only exacerbate the financial woes of women in debt.

Debt Management Plans

A debt management plan (DMP) is another avenue you might pursue to become a debt free woman. DMPs are for those who have serious financial problems because they have too much debt or cannot repay the debt they have. Credit counseling agencies sometimes recommend that you enroll in a debt management plan. However, debt management plans are not for everyone. You should only sign up for a DMP after you have extensively reviewed your financial situation with a reputable credit counselor. Keep in mind that a debt management plan by itself does not qualify as credit counseling. Even if you do end up enrolling in a DMP, you should still work with a credit counseling service to make a budget and improve your money management skills.

Red Flags

Not every service that claims to be legitimate can actually help you become a debt free woman. In fact, some of these organizations will do just the opposite. Be wary of credit counseling services that do any of the following:

• Assess excessive up-front or monthly fees for enrollment
• Put pressure on you to make "voluntary contributions," a fancy name for fees
• Refuse to send you further information about the service until you provide personal financial information, like credit card numbers and balances
• Attempt to enroll you without first reviewing your financial situation
• Try to enroll you in a debt management plan without also teaching you money management and budgeting skills