If you are one of the many people struggling to pay your credit card bills every month and repeatedly discovering that you just can’t seem to make those balances budget then a debt management plan may be a good option for you. The stress alone that is associated with falling behind, or turning to your credit cards just to continue to stay afloat, can be completely overwhelming. On top of that, paying down your credit card debt can seem overwhelming. When trying to determine whether or not a debt management program is right for you there are a few things that you should consider. We’ve taken the time to list a few of these below to help make this decision a little less stressful for you.

What’s Does it Do?

What exactly is a debt management program? When you decide to enroll in a debt management program you are enlisting the assistance of an outside counseling agency. This agency, typically for a fee, will contact your existing creditors on your behalf and work out a payment plan. You will then make one monthly payment directly to the counseling agency which they in turn will use to begin repaying your creditors.

What are the Advantages?

The most obvious advantage is that all of those credit card bills will stop haunting your dreams and showing up in your mailbox. Instead of trying to juggle multiple bills and due dates you will only have to focus on the monthly payment due to your counseling agency. Other advantages of enrolling in a debt management program is that the credit counselor is often able to negotiate lower interest rates and get late payment fees and other fees waived. Those steps alone can help to lower your monthly payment amount which is always a good thing.

What are the Disadvantages?

Although it may seem a little backwards, enrolling in a debt management plan can actually have a negative effect on your credit, at least during the time you are in the program. The reason behind this is that you must close your accounts which can affect your debt usage ratio. However, if you are already struggling to make your payments then it’s likely that your credit is already being affected. It may be wiser to deal with the negative impact during the program and then see the positive effect on your credit once the program has been completed and your debt has been paid off.

Debt management plans make the most sense for people who are already struggling with high interest debt. Especially those who find themselves making little to no headway paying down debt on their own, or those that are worried about falling behind on payments. While these programs are not for everything they can be a lifesaver for those that really need them. It is important to take the time to research the process as well as the credit counseling agency before making any choices. However, hopefully some of the information above made the decision a little clearer.

If you find yourself struggling with debt or would like to find out about becoming debt free, call Debthelper at 800-920-2262, or visit @ www.debthelper.com.