Debt Management Systems

What is a debt management system, and when do you need it? Like any kind of management system, debt help systems can be good or bad. We will take a look at what you can do to manage your debt better. One element is paying off debt, but that's not the only one. It is much more than paying off your credit cards, and doesn't end when you pay off your mortgage or car loan either. You have to make a system of good money management, and follow this system in your daily life. Here are the key elements in such a system:

Make a budget

The purpose of making a budget is to keep track of the money that comes in and get's out of your economy. This is basic in every financial system and absolutely necessary to stay on track. Unfortunately too few people are actually doing this and many are even living above their means. Approximately 10 percent of the American people spends 10 percent more than they make each month. If this can be called a system for managing debt, it's indeed a bad one.

Follow your budget

Now, it's necessary and great to make a budget. But you'll also have to follow it. There's no meaning in using time and effort on making it, if it's only function is to stay in a drawer.

The first symptom of not following it is experiencing a growing need for debt relief. As soon as you eventually see this, you must put all your effort in getting back on track. This might take a bit of time, but it's absolutely obtainable.

What to do if you get off track

If you for some reason do not follow the budget you have made, you need to find a program that can help you get back on track again.

There are many such programs that can help you obtain debt relief. What such programs have in common are that they

• help you organize a plan to pay off debt
• offer advice on how to stay on track with your budget.

The criteria for chosing a plan is that it must be realistic with regard to the time it will take to bring you back on track. If you make goals that are too high, you are setting yourself up to fail, which means a big risk of falling back into your old habits. The average length of a credit-counseling program for example, can range from four to six years.

Credit counseling

This kind of program for managing your debt, is to create a realistic budget, adjusted to the new financial situation you are in right now. Counselors are professionals, who teach their clients good money management. You can also get help to reorganize your debt payments. This is done by consolidating all your monthly payments into one. You don't have to pay each creditor bill by bill. The various payments are automatically distributed to all of your creditors, from this single payment. This normally means decreased interest rates and no over the limit or charging late fees.

Loan consolidation

Loan consolidation programs have much in common with the type of program described above. The main difference here is that all your debt is consolidated into one loan, which usually has a low interest rate.

Debt negotiation

This kind of program is also called debt settlement. The main element in this way to manage your debt is to outsource your problems to a debt negotiation firm, which negotiate with your creditors to reduce the total principal of your debt. The main difference from counselling is that your amount of debt are modified, not the interest rates.

This is the most radical program and is probably the quickest way to debt relief there is. In USA the average length of a such a program is three years.

Terje Brooks Ellingsen is a writer and internet publisher. He runs the website 1st-In-Loan.net Terje gives advice and helps people with personal financial issues like getting out of debt and debt consolidation

---

Craving For Financial Freedom

Have you ever felt trapped in a Rat Race and... Read More

Debt Settlement

What is debt settlement?Debt Settlement is a process to settle... Read More

Whatever You Do....Dont Save Money!

No, that's not a misprint. Even though falling interest rates... Read More

Help to Get Out of Debt

Debt Help is the stepping stone to debt elimination and... Read More

What is Debt Settlement and How Does it Work?

Debt settlement involves negotiating with a creditor or creditors to... Read More

Debt Getting You Down? - Make a List!

Debt is not much fun and when faced with it,... Read More

Debt Relief with this Simple Formula

Is there a way to get out of debt without... Read More

5 Options Toward Debt Relief

If you are in debt, well over your head in... Read More

Budget the Luxuries First!

Strictly speaking, his advice was preceded by another Heinlein maxim... Read More

The New Bankruptcy Law -- How Will It Affect Debt Negotiation?

In April 2005, Congress made sweeping changes in U.S. bankruptcy... Read More

Debt Management Systems

What is a debt management system, and when do you... Read More

Utah, the Nation?s Bankruptcy Capital

Congress recently passed the Bankruptcy Abuse Prevention and Consumer Protection... Read More

What Does A Bankruptcy Trustee Do?

Once you file bankruptcy a court appointed bankruptcy trustee will... Read More

Debt Collectors: Men or Mice?

Who are these people anyway? They viciously harass you and... Read More

Bankruptcy Interest Increases as Deadline Approaches

Congress recently passed sweeping legislation that will significantly reform American... Read More

Getting Past The Idea Of Budgeting & Saving Money

I'm sure you'll agree that budgeting, saving money, and eliminating... Read More

Eight Ways to Consolidate Debt

Next to winning the lottery, a debt consolidation loan is... Read More

Yes to Less Debt

Feeling stressed by the amount of debts you have? Three... Read More

How to Become Debt Free

In today's consumer society it is all too easy to... Read More

How to Get Money When You Are Broke

(Money You Don't Have to Pay Back) 1. One way... Read More

The Debt Free Lifestyle

Many people have been taught that you cannot get ahead... Read More

Debt Free and Carefree

Are you still clearing a mountain of debt amassed last... Read More

New Bankruptcy Law Makes it Harder to Stop Foreclosure

On October 17, 2005 President Bush's sweeping bankruptcy reform law... Read More

Bad Credit Home Loan To Get You Out Of Debt

A "bad credit home loan" can help you climb your... Read More

Creating A Realistic Budget

Budgeting -- ooh, what a scary word! If you want... Read More

How Do I Lower My Debt Burdens?

How do I lower my debts?There are several ways of... Read More

Is There A Way Out Of Your Debt Problems?

Do you have multiple debts? Do you have just one... Read More

IVA Advice

An IVA (individual voluntary arrangement) is an alternative to bankruptcy... Read More

Should You Join a CCCS - Consumer Credit Counseling Service for Debt Relief and Financial Freedom?

Do You Need to Join a CCCS - Consumer Credit... Read More

IVA: Individual Voluntary Arrangement

What Is an IVAThe IVA (Individual Voluntary Arrangement) was introduced... Read More

How To Avoid Medical Collections

With medical collections costing doctors millions upon millions of dollars... Read More

The Five Most Popular Questions About Bankruptcy

WILL MY CREDITORS STOP HARASSING ME?Yes, they will! By law,... Read More

Debt Problems? You Can Negotiate With Your Creditors

It is always possible to negotiate with creditors ? even... Read More