Debt resolution is a way for consumers to settle their debts for less than what’s owed. This is a type of debt relief for people who have gotten in over their heads, and don’t think they can dig out of it. Even though reducing your debt sounds rosy, it’s not all fun and games.
Here are five tips for making a debt resolution stick.
Work with a Credit Counseling Agency First
Talking to a credit counselor is the first step toward alleviating the issue. Credit counseling agencies are usually non-profit organizations that exist to help consumers overcome debt. It’s a good idea to look around for the right credit counselor before getting in too deep. Be alert for red flags. Legit credit counseling agencies can offer consumers a variety of free resources.
It’s not real credit counseling if they’re unwilling to do that.
Credit counseling can help you better understand your debt. A lot of people are confused by the industry terms and lingo. With credit counseling, you can ask questions and get some general direction toward your ultimate goal — getting out of debt.
It’s possible the counselor will tell you debt resolution is your best option.
Set Goals and Stick to Them
Sometimes, individuals dissociate from their financial life when it has become toxic due to debt. There’s no shame in this. It feels bad living in a world where you’re seen as a guilty, irresponsible party, even if that’s not the case. Ignoring your student loans isn’t a solution.
When you’re in the process of debt resolution, it can be helpful to create and stick to goals both for your debt and the rest of your life. Creating goals for beating your debt will keep you on track, even when the going gets tough. Having those greater goals, such as retiring by a certain age, will keep you focused on following through.
Understand Your Debt Is Not Going Away Immediately
A resolution carries a sense of finality with it. While that’s something that eventually can come from debt relief, it doesn’t happen overnight. Debt resolution success stories typically take between 24-48 months for everything to play out and the consumer to walk away with no more debt.
A lot can happen over that time. This is why it’s essential to put some real thought into the other steps on this list. Getting out of debt in a few years is much better than having it hang around forever, or declaring bankruptcy. But it’s important to remember there’s no such thing as a free lunch. Even if the result of the debt resolution is positive, it’s going to take some time and effort to get there. Partnering with the right debt relief agency can make a huge difference in your debt resolution experience.
Find Support from Those Around You
They say it takes a village to raise a child. It might be a bit of an exaggeration, but the same general rule can be applied for adulthood tasks like getting out of debt as well. Life is much harder when you’re going it alone. The reason you’re working with a company to resolve your debt is you were unable to do it on your own. We all want to believe we’re totally self-sufficient, but that simply isn’t the case.
Reaching out to others while you’re going through your debt struggles can help you stay positive, even when things have you down. If you don’t have family and friends willing to provide emotional support, consider looking to join a group, or finding new connections. We’re social animals. Being too isolated, which tends to happen when up against something daunting like debt, can burn you out.
Don’t Beat Yourself Up Over the Past
What’s done is done. It’s time to start thinking about what’s happening now, and how that’s going to make tomorrow better. It doesn’t matter how you ended up in debt. There are all kinds of reasons for it — justifiable or not.
What matters now is it’s time to get out of debt.
You’re going to accomplish this by focusing on what you need to do today, not beating yourself up over what you did yesterday, much less years ago. Having the right frame of mind can make all the difference when going through the debt resolution process.
Getting out of debt can be tricky. But it’s well within your power if you’re willing to put in the work and ask for help when you need it.