What is the Best Debt Counseling Company to Use?


Dear Steve,

I have $13,000 in credit card debt. I got into this help out others, I am know in too deep and need help to get these paid off. I have shredded all cards and I am living by a tight budget, but I would love to to make one payment.

What Debt Consulting company to you advise people to use if they have to go in that direction.



Dear Karen,

I am always intrigued by questions like this. They are great studies of the power of behavioral economics and putting the cart before the horse.

I think deciding on the path or solution without considering the larger and greater situation is a recipe for financial disaster.

It is quite possible that the path you are pre-selecting is the absolutely wrong path for your financial health in the future. Depending on your age and situation, you could be costing yourself hundreds of thousands of dollars by making an emotional decision instead of a logical one.

I implore you to use my online calculator, What Repaying Your Debt Will Cost You in Retirement. I love it when people use that calculator and then want to argue with me that repaying their debt is more important than what the math says. Those interactions all ways make me shake my head because they are examples of emotion over logic or assumptions over facts.

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

It is more than probable that the path you have selected seems honorable to you. I get it. I felt that way when I was drowning in debt decades ago. But modern life has changed so much. These days we need to be concerned about the lack of a secure retirement income. People no longer have the gentle warm wrap of a company pension or even the hefty 401(k) to count on. Concern over the future of Social Security is real and so is the fact that surviving on Social Security alone is a depressing possibility.

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Living so close to the edge for an extended period of time without putting money in savings every month to build an emergency fund is a horrible mistake. A five-year repayment plan is likely to be peppered by some unexpected financial surprises. Unless you are prepared for them, guess what, you wind up back in debt.

So now you are living on a tight budget, without much or any savings component I imagine, and you’ve shredded your credit cards. Hopefully you didn’t close them. Taking care of a good credit score is an important future consideration as well.

So getting out of debt is not about just consolidating your debt in either a debt consolidation loan or a credit counseling program. It’s actually about picking what option is best for you. One thing you can do is to use my Get Out of Debt Calculator and compare the pros and cons of different solutions.

So there is no way to guide you to a particular provider unless you first know the right tool or solutions to use for your situations.

I would urge you to start your investigation of what is best for you by visiting the links above and talking to a bankruptcy attorney, a credit counseling company, and a debt settlement company. Each solution provider is going to try to emotionally sell you on their solution but until you hear from all three, you just can’t make an informed decision.

Damon Day - Pro Debt Coach

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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