If you’re running out of money at the end of each month and struggling to pay your bills, a certified credit counselor can help you regain control of your finances, but how do you know if credit counseling is right for you?
When to call a Credit Counselor
Credit counseling can help you to relieve the stress caused by your financial situation. If any of the following scenarios apply to you, it is a good indication that you may benefit from a counseling session.
- Do you find it challenging to pay your bills on time, or at all each month?
- Do you feel that there is no money left over after you pay your basic expenses or are you experiencing difficulty paying for your basic living expenses?
- Are you not sure where your money seems to be going each month?
- Do you feel that you may need a better understanding of your financial situation?
- Do you want to gain control of your overall financial situation, but are unsure of how to get started?
How can Credit Counseling Help?
Taking the first step by reaching out to a credit counselor can be daunting and emotional, however, a counselor will work with you to gain an in-depth understanding of your unique financial situation and develop a personalized plan for you to move forward.
What you can expect from a counseling session is a confidential, professional, financial counseling session, which is designed to provide guidance, recommendations and resources to help you deal with your financial situation. Additionally, every NFCC Credit Counselor is required to be certified and undergo extensive training. Certified Credit Counselors must also maintain their NFCC certification by participating in professional development classes and workshops.
When you reach out to a credit counselor, you will be asked about your current financial situation so that the counselor can gain an understanding of the specific circumstances that have put you in your current financial hardship. Having the knowledge of your monthly expenses and income prior to reaching out can be helpful and will expedite the process. Once the counselor has become familiar with the events that have led to your current financial situation, he/she will speak with you about your monthly spending plan and budget.
The creation of a budget specific to you is a key step in understanding your finances and where your money is going. You may choose to work with a counselor to resolve your financial concerns on your own using the educational material and budgeting advice provided.
Alternatively, you can enter what’s called a debt management plan, or DMP. Through a DMP, you can consolidate your credit card payments and in many cases, interest rates are reduced, making your financial obligations easier to tackle.
Good to know.
When you speak with a credit counselor about your situation, it doesn’t affect your credit score. Simply meeting with a counselor, and working out a budget, won’t impact your credit report in any way.
About the Author:
Lori Stratford is the Social Media Strategist at Navicore Solutions. She promotes the message of Navicore’s financial education to the public through social media, video and content.