- The Federal Consumer Information Center (FCIC) offers information on consumer issues, including managing debt.
- Do you routinely spend more than you can earn?
- Are you forced to make day-to-day purchases on credit?
- Are you able to make only the minimum payment on monthly credit card debt?
- If you lost your job, would you have difficulty paying next month's bills?
- Carefully check all your bills to make sure all expenses are legitimate.
- Contact your creditors and explain your financial situation. Often they are willing to help by accepting smaller payments.
- Create a budget that reduces your spending and your debts — and stick with it.
- Avoid incurring new debt.
- Use your savings or other assets to reduce high-interest debts.
- Look for additional resources that might be available in your community.
- For more information, call 1-800-688-9889.
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E-mailAmericans are spending more and saving less. We currently spend a surprising 92.5% of what we earn. At the same time, we are incurring more debt, which indicates the increased spending is being funded with borrowed money. Most likely, credit cards are the engine of this indebtedness.
If you are running up your personal debt, it may be time for a debt diet. Don't wait until your pyramid of debt collapses and your personal savings are jeopardized.
Consumer Credit Counseling Service
If you have trouble controlling your spending or if your creditors resist working with you, the Federal Consumer Information Center suggests contacting the National Foundation for Consumer Credit. This organization has local, nonprofit members that offer budgeting help and counseling. They are often listed locally under the name "Consumer Credit Counseling Service."
Make sure the local agency you contact is a member of the National Foundation for Consumer Credit, and not a for-profit company that consolidates debts. Call 1-800-388-2227 for an office near you.
Bankruptcy
If your financial problems are serious, you may want to consider personal bankruptcy; a legal proceeding that can give a debtor a fresh start. However, it is a serious step that may remain on your credit record for 10 years. If you consider this option, you may want to consult an attorney for information on the different kinds of bankruptcy.
Other Options
There may also be service organizations in your community, such as legal aid, that can help you understand your options. Also, a wealth of books are available on the subject.
Other Web sites that deal with consumer debt:
Information on creating a budget and building good credit.
A public service site with hundreds of useful consumer resources on the net.
This nonprofit resource offers information on getting out of debt, improving credit and organizing finances.
National Foundation for Consumer Credit
A network of local non-profit organizations that provide consumer credit education, debt counseling and repayment programs.