NDSU Extension Service - Ramsey County

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September 19, 2011 Financial Column

          When the bills pile up and you can’t seem to dig your way out, several options may help you manage financial difficulties.  If you have a great deal of self-discipline, you can put yourself on a personalized debt-management plan.  If you feel this method won’t work, then you may choose to visit a financial counselor.

          Debt management counseling services can help you set up a budget and debt repayment plan. Non-profit financial counseling agencies charge very little, if any, for their services.

          Credit counseling services can be located through the National Foundation for Consumer Credit at www.nfcc.org.  An increasing number of agencies operate under other names, but all members can be identified by the NFCC member seal. This seal represents accredited agencies with high standards, ethical practices, certified counselors, and policies and practices which help consumers achieve financial stability. It is best to use an accredited agency.

          Debt management counseling services can help you set up a budget and debt repayment plan.  A counselor will review your application. The counselor is qualified to prepare a budget plan that will be given to you and your creditors for approval. The budget plan will outline exactly how each debt will be repaid. When followed, the plan is usually all that is required unless there is an emergency or a change in your financial situation. You can return to the counseling service at any time for further counseling.  The counseling service may ask for a contribution, or it may be free.

          Other things to ask a debt advisor:

The type of client in which they specialize

List of services that they and their firm offer

Do they create a written financial plan - cost of that plan?

Do they provide educational services to their clients regarding money management?

How many clients do they currently have and how much money do they manage?

How do they charge their clients (is it fee based, fee only or commission)?

 

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