First, allow a Debtscape Certified Credit Counselor to assist by providing a full budget evaluation. A budget evaluation can determine how your funds are being allotted, and our Certified Credit Counselors can help you to make suitable changes if necessary. Once you have established a more appropriate spending plan, there are several methods of handling your bills on your own, depending on your situation.

If you are current on your bills:

A current consumer has a much better chance of negotiating a payment plan or lower interest rate directly with their creditors. Whether fully current, or, current but barely managing the minimum payments, a consumer may contact the creditor directly via the customer service department to request a lower interest rate. The consumer should point out to the customer service representative that all payments have been on time, and that there are credit-card companies that offer lower rates. The customer service representative will forward the request to the appropriate department for review. The creditor will then contact the consumer via mail to advise what they can offer.

If you are falling behind:

While an interest rate reduction will most likely not be possible, each creditor has its own 'hardship' program that is designed to help. The most important factor to remember is that OPEN and HONEST communication with the creditors is the key to receiving assistance. A consumer who immediately contacts their creditors at the first sign of trouble is more likely to receive assistance from the creditor. A consumer who ignores letters and phone calls, and evades the creditor at every turn, will ultimately find that the options from the creditor are few.

Things to Consider

• An interest rate reduction and/or payment plan is not an all-encompassing solution for those with budgeting and spending problems.
• Distinguishing between wants and needs, becoming more frugal and living within a balanced budget are necessary steps to achieve financial freedom.
• Create a monthly budget. If the budget indicates that there should be money leftover after bills are paid, but the consumer feels that this is not the case, a daily record of expenses may determine where money is being spent. Keep a small notepad and record every purchase.
• Some consumers have access to savings. Using savings for fleeting purchases is not recommended, however, a savings account earning 1.5% interest will be better utilized paying off credit card balances carrying much higher interest rates.
• Remember – the secret to a debt free life is having all the facts about your own spending habits. Once spending patterns are identified, a manageable solution can be created.

Websites that can provide additional information:

• www.moneysaviors.com
• www.frugalliving.about.com
• www.frugalfamilynetwork.com
• www.healthy.net/library/articles/cash/assessment/spendingpersonalities.htm

The websites listed are for informational purposes only. Debtscape, Inc. does not endorse nor promote these companies. This information is provided as a courtesy resource, and is not intended to replace consultation with an industry professional.