Is Freedom Debt Relief a Reputable Company?

If you have a veritable boatload of outstanding debt, you may want to consider Freedom Debt Relief (FDR), which offers strategies for shedding your unsecured obligations. But is FDR a reputable company?

The short answer is yes, let’s take a look.

FDR At A Glance

Basically, the company requires a minimum debt of $7,500, and its typical customer has $25,000 in obligations. Fees range between 15% and 25% of the enrolled debt, although the amount varies depending on your state. 

The time it takes to eliminate debt is between two to four years, with the average debt resolved in three years, 10 months. Post-fees savings to consumers are between 15% and 35%.

How Does FDR Work?

Freedom Debt Relief has trained debt professionals who will work with you to put in place its debt relief and settlement programs.

Initially, a certified debt consultant will discuss your situation with you and evaluate potential remedies. If you sign on, the consultant will help you create a personalized repayment plan.

You then will usually cease paying your debts directly and instead deposit those monies into a dedicated account controlled by you. Once there are sufficient funds in that account, Freedom Debt Relief will open debt negotiations with your card issuers. 

This means that your creditors will be asked to accept a one-time payment in full for less than you owe. It’s important to know, however, that stopping payments on your current debt will, at least for the near term, damage your credit score.

If an agreement is reached with your card issuers, and you approve the amount, funds will be transferred to your creditors as debt payment.

Is FDR a Scam?

Hardly, although there are many unscrupulous agencies out there that are more interested in helping themselves than helping you. 

These firms often; charge fees before they settle your debt, “guarantee” to make your debt woes disappear, tell you to stop talking to your creditors, pledge that you’ll clear your debts for pennies on the dollar, say they can stop debt collection calls or lawsuits, offer a one-size-fits-all remedy that may not be right for you or use scare tactics to pressure you to enroll in their program.

Be leery of companies that do any of these things.

In contrast, Freedom Debt Relief is accredited by both the American Fair Credit Council and the International Association of Professional Debt Arbitrators. Since 2002, more than 650,000 clients have been served by FDR, which has resolved more than $10 billion in debt. So, you can sign on knowing you’re getting legitimate credit relief.

Here’s what Freedom Debt Relief does, which sets it apart from bogus or unsavory agencies:

• It never charges you until it negotiates a settlement
• It helps you deal with creditors but doesn’t tell you to cease communications with them
• It offers a subscription to the National Litigation Law Group service that provides certain legal representation if you need it
• It provides you with a realistic estimate of when you can expect to become debt-free
• It develops a bespoke relief plan for you that suits your needs and financial goals
• It spends time understanding your unique needs to make sure it’s the best solution for you

Is Freedom Debt Relief a reputable company? Well, it didn’t become the largest debt settlement company in the nation by ripping folks off. While no debt relief company can guarantee that it can reduce a customer’s debt with a creditor, FDR’s long history of negotiations with so many top creditors is real and gives it a leg up over the competition.

Freedom Debt Relief Reviews Tips to Live Better on a Budget

If you're currently trying to lower your household spending, you're not certainly not alone- Freedom Debt Relief Reviews has found that the majority of homes in America have less than $500 in savings. 

The best way to begin to work your way towards a better financial future is to start living on a budget. However, many people believe that living on a budget means they'll have to significantly decrease their quality of life. 

Freedom Debt Relief Reviews knows that it's easy to set up a budget and stick to it while also making time and money for the fun in life. Here are some of our best tips to enjoy life while also finding opportunities to save!

Create a budget- and stick to it

The first step to saving money is to figure out how much you're spending and nail down areas in which you can afford to cut back without too much of a sacrifice. When you "wing it" every month without a solid budget, it's easy to let money slip through the cracks that you might not even know about- after all, small purchases a few times a week will quickly add up to big bucks that you could have put in the bank. 



Sit down with your spouse and collect all of your bank statements and pay stubs, and open up your checking account to track exactly where your money is going. Then, identify areas in which you can afford to cut back without too much of a sacrifice- for example, if you spend on fast food twice a week, cooking at home just once a week can save you up to $20 a week if you're feeding a family of four.

Control your grocery bill

Freedom Debt Relief Reviews has found that one of the easiest ways to save money without cutting your lifestyle is to plan ahead when it comes to your grocery bill. Writing a grocery list before you head out to do your shopping can reduce the possibility that you indulge in expensive impulsive purchases, which will save you money in the long run. 

Research also suggests that shoppers have a tendency to spend more when they hit the shops on an empty stomach-so be sure to have lunch before you fill up your shopping cart. To save even more, you can even shop wholesale for nonperishable items like canned foods and sauces, paper products, and cleaning supplies. 

All of these steps are ways that you can reduce your grocery bill's strain on your budget without reducing your quality of life.

Budget for your travel

Freedom Debt Relief Reviews has found that many consumers believe that a vacation is an automatic budget buster. However, with a bit of planning, you can take the time off that you want without completely throwing you off track towards your financial goals. 

Take time to research destinations that offer a favorable exchange rate, and if you're staying domestic for your vacation, consider going in the off-season when prices are lower. 

If you find that you won't be able to stretch your dollars far enough to afford the vacation that you want, planning a "stay-cation" within your own town can give you a completely new lease on your area, and can be just as fun as a traditional vacation!

The secret to saving when you're living on a budget? Planning ahead! Freedom Debt Relief Reviews has found that if you don't want to make drastic cuts to your lifestyle, taking the time to plan what you're going to purchase ahead of time is necessary to avoid the impulse purchases that can be a big drain on your budget. It's possible for anyone to start on the path towards a healthier financial future with a little bit of work!

Freedom Debt Relief: Planning For Retirement at 50

Financial advisers constantly stress that young people must plan early for retirement. Where is the advice for people actually closing in on retirement like 50-year-olds? With only 10 to 15 years left before retiring, 50 is an important age to take stock and make sure everything is heading in the right direction.

While you won’t have the broad time horizon that a 20-year-old would, you still have enough time to make changes that have a big impact. Experts recommend adding the entirety of your life savings, including investments and money stashed away and dividing it by 25. 

If you can live on that amount of money for a year, you are on track for retirement. This approach assumes you withdraw 4% per year from your funds. Freedom Debt Relief goes over additional advice to keep or get you back on track for retirement.

Asset Allocation

Freedom Debt Relief knows due to a broad time horizon young people can afford to have risky investments. The high risk allows them to potentially make a lot of money while still being able to bounce back if things go wrong. 



This is the opposite of how a 50-year-old needs to invest. When there is less time left before retirement, your portfolio may not be able to recover from a decline in the stock market. Change your asset allocation to minimize risk by investing in CDs, bonds, and annuities.

Look at Health Care Coverage

Health care can be an enormous expense in your later years. Getting covered at 50 will be a lot cheaper than trying to get covered at 65 or 70. Freedom Debt Relief recommends getting properly covered in health care now so you don’t spend all your money paying for medical expenses in retirement.

Max Out Retirement Contributions

Freedom Debt Relief advises contributing the maximum to all your retirement investment vehicles. This advice is the same for young and old investors. 50-year-olds are eligible to increase their 401(k) contributions by a significant amount, so take advantage of it. 

If your employer offers a match, not contributing to your 401K is like leaving free money on the table. 50-year-olds can also increase the contribution to their IRA or Roth IRA. Maxing out your contribution is one of the best ways to save money.

Reconsider Insurance

Responsible adults purchase insurance when they have young children or spouses reliant on their income. Evaluate your insurance to make sure everything you pay for is still relevant. 

If your children are financially independent, drop unnecessary insurance and put the extra cash towards your retirement. Freedom Debt Relief always advises careful monitoring of where your cash flow goes each month.

Freedom Debt Relief Has A Quick Guide to Stable Finances

Everyone wants to avoid financial stress, especially debt, but it’s so easy for things to get out of control. Between avoiding impulsive purchases, keeping up with bills, and covering surprise expenses, there’s a minefield of potential obstacles to staying on track.

But it needn’t be so hard. The key is to leverage the power of your daily and monthly habits. Over time, small adjustments to your daily spending habits will pay huge dividends. More than preventing yourself from going into debt, you’ll be able to leverage the power of savings.

Freedom Debt Relief deals with plenty of consumers and has seen what happens when things go wrong. To help you make sure things go right, we’ve put together this quick guide.

Budget Differently

You’ve been told to make a budget before, but have you been told how? The problem with most budgets is that they assume that you need to fit your income to your budget.

While, of course, you don’t want to spend more than you earn, you should make your budget based on your whole life, not just your income. Lay out your life goals. Life goals include long-term goals, like retirement savings and short-term goals, like your desired lifestyle. If you want to take a two-week vacation each year, budget for that too. 


By focusing on what you want first, you can decide whether you need to make more money or where you can cut back to make those goals happen. Above all, a budget should set out your priorities so you can see what’s worth spending money on and what you can cut out.

Be Responsible with Credit Cards

Some savings experts will tell you to avoid credit cards altogether. But credit cards are a useful tool. You just have to use them responsibly. Only use your credit cards to pay for things you can afford. 

There are few things worse for your long-term financial health than partial, late, or unpaid credit card payments.Partial payments result in a snowball of interest, while late and unpaid payments ruin your credit score. 

Research credit card offers extensively before you choose to use one. All the information about fees and costs is there. You might have to do some digging to find it, but there’s no excuse for being surprised by a credit card fee.

Change your Shopping Habits

Whether it’s transportation, entertainment or living expenses, you can find ways to save on almost everything. Shop for clothes at second-hand stores when possible. Use promotional offers for outings to movie theaters or restaurants. 

Enroll in loyalty programs to save on groceries and gas. Wait for desired items to go on sale, and only buy certain food when it’s in season.

It may seem like a pain, but once you get in the habit of finding savings on everyday items, it will become second nature. The best part is that all those little savings add up to allow you to save for retirement and plan fun vacations.

Create a System for Bill Payment

Kevin Gallegos, of Freedom Debt Relief, recommends setting up, “a system that works for you and that you’ll use consistently.” Seems pretty simple, right? Yet, so often consumers must pay an overdraft or late fee. Avoiding those sorts of easy-to-avoid expenses is another habit that pays dividends over time.

Find out what works for you. Gallegos says that it could be “automatic online payments, a spreadsheet, a cell phone reminder, or a list on the refrigerator.” All that matters is that it gets you to pay your bills and cash your checks on time.

Map out Long-Term Goals and Review Regularly

“Financial success” is different for everyone. That’s why it’s so important to dedicate some time to figuring out what you want to accomplish and what that’s going to cost. 

No one would jump in a car with only a vague idea of the route to their desired destination and expect to arrive without getting lost. So why would anyone expect an easy road to their financial goals without extensive planning?

Create milestones for your goals so you can figure out when and how much you need to save. Then, review your finances regularly—ideally once a month—to make sure you’re on the right path.

By reviewing your finances, you serve yourself in two ways. First, you’ll be in tune to your spending habits so you can adjust accordingly to stay on track. And second, you can keep track of any discrepancies on your credit card and bank statements.

Most credit card companies have a limitation on when you can dispute a claim. So, even if you have a legitimate claim, you might not be able to work it out if you make the claim too late.

Pay Yourself First

Monthly savings cannot be viewed as anything less than mandatory. Gallegos of Freedom Debt Relief recommends considering additions to your savings as a requirement, rather than a chore. 

Treat it like a required payment to your future retired self who will need financial support. Don’t overextend yourself by paying too much, but find some room in your budget even if it means sacrificing some fun money.

“Know what you have to spend—and spend less”

This last tip comes directly from the Vice President of Freedom Debt Relief. He says that learning to live below your means, “taking responsibility and choosing where your money goes,” could help you immeasurably in avoiding financial trouble.

To use this tip, reevaluate your budget completely. Search for expenses that you can reduce or eliminate and stick to your plan. Err on the side of cutting too much—you can always add subscriptions or memberships that you end up missing. Chances are though, you won’t even notice they’re gone.

Achieving your financial goals is most easily achieved by making small changes to your daily routine. Consistently enact these changes to your spending and savings habits, and you’ll be amazed at the difference small things can make over time.

Debt Settlement- Debt Relief Solution for Saving Money

Debt settlement gives you a way to pay your creditors back while saving money. It helps you deal with financial challenges by enabling you to reduce the outstanding balance, avoid collection harassment and get rid of debt fast. 

If your goal is to eliminate debt faster through a manageable debt relief option, settling debt is a worthwhile solution.

Choosing a Debt Relief Option

Choosing the most ideal debt option for your situation involves looking at reviews, learning how the program works, finding out how much you can save and comparing the different options that are available. 

A strategic approach to your financial problems will make it easier to pick a suitable debt relief option according to your situation and adjust to another option as your financial circumstances change. 

Bills and Budgeting

Along with implementing debt settlement, you need proper budgeting to help you manage your bill payments and control expenses. 

A clear budget plan is essential for allocating the funds to pay bills, lowering unnecessary expenses, making payments regularly to avoid costly penalties and improving your credit score over time. 

Debt Settlement Services

You will be able to restore your financial life when you are proactive about your debts. There are debt settlement services and relief companies that can help you settle, renegotiate or alter the current terms of your debt to creditors. 

They negotiate with creditors to lower the total amount that you owe. Read debt settlement reviews here.

Consider your options when you seek to negotiate directly with creditors and get out of debt. Working with your creditors to create a manageable and affordable debt repayment plan can help you overcome debt. 

Before you embark on negotiations with creditors to reach a settlement, find out as much as you can about the debt and the functionality of the plan to ensure that you make a reasonable proposal.

Settlement Negotiations

Prepare for settlement negotiations and a realistic repayment agreement by understanding the debt, planning for a settlement proposal and negotiating a worthwhile agreement with the creditor. 

Learning more about debt constitutes aspects such as the entity that is owed or creditor and the total amount owed. You need to be sure about the creditor you owe and the amount. 

Making Repayment Proposals

When you want to make a repayment proposal, there are a number of factors that you need to keep in mind.

• Be realistic about the amount you will be able to pay every month. 
• Assess your priorities to avoid paying off debt while neglecting other bills that can cause further problems. 
• Create a summary of your income and expenses that include how much you plan to repay and other payments. Make an effort to allocate some of your income to emergencies and unexpected expenses.
• Make a decision regarding the overall amount that you will pay as settlement for the total debt. This may be in the form of a series of payments or lump sum. It is important that you focus on paying what you can afford. 
• Effective negotiations with creditors while using a proposed plan for repayment are based on a clear explanation of your financial situation. 

How Getting Out of Debt Is Both Easier and Harder than Ever

The average American household has over $90,000 in total debt. If you are living with debt, you know what an uphill battle it can be to get out. Fortunately, there are a number of solutions and tools out there to help you along the way. 

However, scam artists also recognize the desperation of indebted consumers and are targeting individuals trying to settle their debts.

The FTC Shuts Down Several Scam Operations in Florida

Recently, the attorney general of Florida and the Federal Trade Commission (FTC) closed down numerous scam operations that were ripping off consumers. The eleven enterprises were controlled by three individuals. 

They were persuading people in debt to sign up for a program that would relieve them of thousands of dollars of credit card debt. To take part in the program, these consumers were told to send monthly payments to the debt companies, who would then make a deal with the credit card companies.

As you may have guessed, the debt settlement companies were not putting the payments toward the credit card debt. And, their scheme is not unique to Florida. This is common in just about every state. Thankfully, there are many other tools at your disposal that do not involve scams. Here are a few tips:

Work with an Authentic Debt Consolidation Agency

There are many reputable and legitimate debt settlement companies in existence that help consumers to find relief from debt without resorting to bankrupty. Many offer free consultations to help you decide if this approach is the most beneficial for your circumstances. 

With assistance, you will have a plan that allows you to work on reducing the debt, which makes it less overwhelming and provides peace of mind. 

Speak to Your Credit Card Company

Credit card companies want to work with you to help you pay off your debt, rather than selling your debt for pennies on the dollar to collection agencies. Often times, they will let you temporarily reduce your payments.

Talk to a Counselor

Your bank or credit union will be able to direct you to a credit counselor, or you can find a non-profit credit counselor through the National Association of Credit Counselors.

Try Settling

Do you have a collection agency hounding you for payment of your debt? We recommend saving up as much as you can, and each time they call, offer to settle for however much money you happen to have saved.

Collection agencies will often settle for as little as half of the total amount you owe. If they’re willing to settle, never give them access to your checking account. Instead, first get their agreement to settle in writing, then get a cashier’s check for the total amount. Afterwards, insist on a written document stating that the debt is settled.

Use the Power of the Latest Apps to Get out of Debt

The prevalence of massive consumer debt has naturally attracted the attention of tech firms. They have come to the rescue with a number of easy-to-use applications such as the Debt Manager app. 

It orders your debts from smallest to largest (or highest interest rate to lowest if you prefer). It also calculates how much total interest you will pay using a variety of repayment methods.

If free is more your speed, then you should consider the Debt Eliminator app. First, you enter your credit card debts, minimum payments, and APR. It then asks how much extra you can pay and advises you to pay the highest interest rate debt first. 

If you cannot pay extra, it provides a worksheet to help you trim excess spending. The best part about the app is how it pushes you to be proactive in getting out of debt.

If you do not mind really getting into the nitty-gritty and sharing your personal information, the free Ready for Zero app may work best for you. 

It asks for your social security number and personal questions that ensure you are who you say you are. And, it gives advice that is specifically tailored to your needs.

There are many resources out there that can help you to reduce debt and turn a negative situation into a positive one. The key is to start sooner rather than later.

Role of a Debt Counselor in a Debt Relief Firm

Debt counseling is the right choice for people who are interested in helping people in financial crisis. When some individuals find themselves in a financially difficult situation, when they are faced with rapidly mounting debt that they cannot manage on their own, they generally need to contact a debt counselor in a debt relief firm. 

Debt counselors are adept at offering advice on all aspects of finance right from budgeting to wealth management, financial planning relating to debt mitigation or debt relief services. They also represent their clients in court proceedings or creditor meetings.

Expected Academic Qualifications

Beyond everything, a credit and debt counselor is expected and required to have a tremendously strong base in finance and economics, and to possess a working understanding of federal and state statutes, regulations and laws on banking, lending and other aspects of personal finance. 

A bachelor’s degree in business, economics or finance is hence the perfect academic background. 

• Debt Management: Is Settling Right for You?

Your CV will get noticed if you could complement this with a few years’ job experience in the private finance sector. It is noteworthy that several companies value and give precedence to job experience over educational qualifications. To be absorbed into a job, you will be required to attain accredited certification through an examination. 

Necessary Soft-Skills

Besides the knowledge of how to navigate tricky financial situations and come out on top, a debt counselor will need to possess a strong command over verbal as well as written communication as a large portion of his job is the negotiation aspect, which requires him to liaise with creditors, courts and other agencies on behalf of his client. 

An aptitude in mathematics ensures that he is able to crunch the numbers and find the most logical and least expensive way out for his client.

Several employers also stress on knowledge of computers and accounting software. Your communicability is also improved if you are well-versed in a foreign language, which makes it easier for you to serve a particular community besides general clients. 

You will need to blend in with several types of people, and be patient to their plight, hear them out and serve them to the best of your ability. Administrative skills, time management abilities and prioritization are musts for any candidate who wishes to climb the ladder in the debt counseling and relief industry.

What Does a Debt Counselor Do?

A debt counselor is a financial advisor who deals with clients in financial distress. Being a debt counselor, you will be expected to provide emotional, moral and practical support to your clients so that you can see them through their period of indebtedness through financial planning, budgeting, wealth management, and if required, declaration and negotiation of bankruptcy. 

You will have to speak in the clients’ voice and also represent them in all legal proceedings as well as financial negotiations with creditors and their mediators.

The first step of a counselor’s job is analysis. You are expected to list and understand all aspects of the client’s monthly income and expenditure, and also make a list of all the debts, mortgages and leases which have been taken by them. 

Further, you need to prioritize this list to understand which debts are needed to be paid off immediately, so that they do not snowball into much larger amounts. The next step is to devise a payment plan, and then draw up all the paperwork. 

You will need to present your plan to the creditor, negotiate with them and get a written confirmation of the acceptance of the modified payment scheme. The legal aspects soon follow. Several clients may be forced to opt for bankruptcy. In that case it would be your job to help them through it and then assist them in improving their credit scores.

Debt Counselor Job Prospects

The debt relief industry is growing each day, and a steady growth pattern from the year 2010 to 2020 has been predicted by the U.S. Bureau of Labor Statistics. This means that there will be more job openings in the coming years. The indicated median income of a debt counselor in 2012 was $39,420. It is primarily a desk-based job, but sometimes you need to visit offices and courts for liaisons. 

Author Bio: Corey Mather has written several debt reviews and other finance-related articles for his blog. Having worked in the finance sector for over a decade, he has a sound knowledge in this business.

Debt Management: Is Settling Right for You?

You've probably heard the claims of companies able to "settle your debt for pennies on the dollar." If you feel like you're drowning in debt, that probably seems like an attractive option. Though the financial relief that comes from no longer having your debt is a huge step forward, the hit that your credit score will take may make you change your mind. Carefully consider all of your options before you make a decision to settle debt.

Debt Settlement Companies

A debt settlement company acts as an intermediary between you and the companies to which you owe money. They'll ask you to stop paying your bills and send them a monthly payment, instead. Part of this monthly payment is a fee to the company, and the other part goes into an escrow account for making the settlement. The settlement company will then contact your creditors and offer to make a settlement.

Perhaps the biggest downside to this method is that you're actively ignoring your bills without telling the creditors what you're doing. All of these missed payments will go on your credit report, where they will stay for seven years. As your payment history accounts for almost 35% of your credit score, even a single delayed payment can drastically lower it. This can be especially devastating for those with good credit. However, the debt relief that can come from settlement is significant and may be the only option for one who has found themselves deep in debt. A bad credit score can be recovered, while debt may increase over the years if it is not taken care of early on. 

DIY Debt Settlement

Another option is to eliminate the middle man and contact your creditors by yourself. To do this, you need to be able to pay the settled amount immediately, so save up a chunk of money or use your tax refund. When you have that money saved up, call the company and make them an offer. Like working with a debt settlement company, this method typically works better when you've missed several payments. At that point, the creditor may have written off your debt, or feel that it's better to take whatever amount they can get. This method may work better on debt that came from a sudden unexpected expense, such as medical expenses. Those who have incurred debt over time, as is often the case with student loans, would do best to seek professional financial advice for their settlement.

Not everyone is equipped to handle their own settlement. Unless you have considerable financial knowledge (and, preferably, a legal background), you should seek professional advice before you go forward on settling your own debts. When it comes to debt and money management, a small mistake can end up costing your for years to come. 

Impact on Your Credit

Not paying your bills has a huge impact on your credit score, and in order for debt settlement to work, you usually have to stop making payments for a while. For example, a payment that's 30 days or more late can reduce your credit score by 50 points. When a payment is delayed even longer—and you have more than one account that's reporting late—the results can be even more significant. The company will also report that you've settled to the credit bureaus, which some might perceive as a risk.

Debt settlement can work for many people, while others should look into other options. Consulting with a financial advisor, who can assess your unique financial situation, is the best way to know where you stand and what option is the right one for you.

Informational Credit to Hudson & Company Insolvency Trustee Inc.

Great Tips for Credit Card Debt Relief

Credit Card (Photo credit: 401(K) 2013)

After you have dug a hole into your credit cards it can seem almost impossible to get out. Although you might feel like you are in a bind with your credit cards, there are a lot of options available to you. Just start thinking about the future and leave the past behind you. 

What you have to do is think about how you are going to get your finances in order, rather than dwelling on your current financial position. Take a look at this article to see what you can learn about figuring out how to pay off you credit cards for good. Read on for some great tips on credit card debt relief.

The first thing you want to do is find out how much debt that you have. Once you can figure out how much debt you have you will figure out how much money you need to make to get yourself out of debt. This is a good way to understand what you need to do in order to get your finances in order. 

You can figure out how much you make a month and how much you spend on bills. Write out a budget for yourself and try to calculate how long it would take you to pay back your credit cards. This should give you a clear idea of how long it will take you to clear your credit card debt.

If you feel like it is going to take too long for you to pay off your credit cards, then you are going to want to look for another job, pick up more shifts at work, or consider working two jobs for a little while. All of these options are going to help you get more money regularly that you can use towards paying off your credit cards. 

It takes a little sacrifice to get yourself back on your feet and to eliminate the debt that you have created for yourself. Yet if you are serious about eliminating your debt, then you are going to sacrifice a little to get ahead.

Consolidation is always an option for you, and it helps you establish yourself further. Buy yourself a little time by consolidating your credit cards and having a budget that works for you. All it takes is a simple phone call to your credit card company, and you can have them consolidate your loans. 

You can also head down to your bank and see what they have to say about consolidating your credit card debt for you.

Use the tips for credit card debt relief shared above. Do not let credit cards scare you any longer. With the right amount of motivation you can find a way to pay off your credit cards in a timely manner. Planning ahead is the key towards figuring out how to pay off your credit cards. 

You now know what to do in order to relieve some of your financial debt. So dedicate yourself from here on out to practicing healthy credit card habits and pay off your credit cards as soon as possible.

How Credit Makes the World go Round

Wipe our Debt (Photo credit: Images_of_Money)

Way back before everyone carried little plastic cards in their wallets instead of cash, the saying was money makes the world go around; not so anymore. You and I are not the only ones who seemed to be enslaved by credit. The biggest user of debt is the US Government itself.

How it Works

Just about everybody is aware that our country is trillions of dollars in debt, but not everyone knows how our government keeps functioning under that debt load. Creating more money is not the answer. If our government creates too much money inflation runs rampant. Instead of paying four dollars at the market for a gallon of milk you end up paying 24 dollars instead. Our government keeps working because of their ability to borrow from other countries, primarily China and Japan. 

If not for the trillions of dollars borrowed from these two countries our country would indeed come to a complete halt. We borrow money by issuing US Treasury notes and bonds. China, Japan, and other countries buy these debt instruments for the interest we pay them every few months. When the bonds and notes mature they’re either rolled over into new Treasuries or we pay the principle amount back in cash. Most Treasury Securities mature every 5, 10, 20, or 30 years. In most cases our government strives to roll the debt over into new long term debt so they don’t have to come up with the cash to pay out.

The Cost of Bad Credit

Most people now days are familiar with their credit score and how it impacts your ability to borrow and the interest rate they receive. If you have poor credit the amount you are able to borrow suffers, and the interest rate you can borrow at rises. The same goes for our country. For many decades our countries credit rating has been the very best; AAA. That makes the US just about the safest country in the world to borrow from. Due to our current economic problems our country’s credit rating has suffered. 

Standard and Poor’s, one of the primary credit rating agencies in the world downgraded the United States debt from AAA to AA with a poor outlook. They have since changed the outlook to stable but have kept their rating at AA. So what does that mean for our government? In order to attract enough investors (like China and Japan) our government has to be willing to pay a higher interest rate due to the increased risk of borrowing from a country in financial and economic turmoil.

Just like the average citizen, as their credit score improves or disproves, the interest rate they are able to borrow at rises or falls. The amount of money you can borrow will also go up or down depending on your credit score.

What if You Can’t Borrow

If your credit score falls too low you lose the ability to borrow money at any rate because the risk is considered to be too great. If you can’t borrow what do you do when there is a financial emergency? Fortunately for most people there are finance companies that give payday loans, personal loans, and car title loans, to name a few. Those are all high interest rate ways to borrow money no matter how bad your credit may be. 

Unfortunately for our government it’s not so easy. It is vital to our country’s economy that our government is able to borrow what it needs to keep functioning and hopefully one day someone will come up with a way to significantly reduce our country’s debt.

Smith is a professional blogger that provides financial information on savings and loans. He writes for InstaLoan.com, a leading title loan lender.

Debt Settlement and Credit Counseling Can Solve Your Financial Problems

Wipe our Debt (Photo credit: Images_of_Money)

Most of all Americans are in debt, but that’s not always a bad thing. There’s a saying that goes you need to spend money to make money. It’s when you are in debt that you did not intend to acquire and you don’t know what to do – then it becomes a problem. Whether it’s for your mortgage or overuse on credit cards, many debt counseling services exist to help guide you through these issues. 

So what are the factors you should take into account before looking into these organizations for help? What data points should you use to compare debt settlement and credit counseling services?

Compare Debt Settlement & Credit Counseling

1. Location – though communication via e-mail or by phone is easy, nothing beats an in person meeting when it comes to learning how to deal with financial issues.
2. Services – Are you looking into debt management programs or just counseling? You should also look into specific information like housing counseling or pre-discharge debtor education.
3. Agency Type – Both for profit and not for profit agencies exist, but not for profit ones generally rank higher and charge less.
4. Affiliations – This is just more for credibility, but that’s how you know whether an agency can be trusted. 5. Price – even not for profits have to earn revenue to stay afloat. The average debt management plan is about $65 per month.

Don't Be The Next Victim Of Credit Card Debt Scams!

(Photo credit: Wikipedia)

Overwhelming credit card debt is a horrible problem to have. Unfortunately however, if you are a senior with credit card debt, you've got something else to worry about these days. One of the biggest scams on the market these days is false promises of credit card debt relief. I've heard of several call centers popping up with the intent to fool seniors into thinking they will receive debt relief, only to go out of business 6 months later with incredible profits. 

Are You Scared? … You Shouldn't Be! 

The truth is, there are tons of con-artists out there just waiting to get their hands on your money but, you also have everything you need to protect yourself. When it comes down to it, spotting a scam really isn't that hard to do. Here are some tips to help: 

• Don't Trust Telemarketers – I'm not telling you that you shouldn't give a telemarketer a chance to win your business but, it's important to trust none of them. You should take the time to do your research. Some telemarketers may have the best of intentions but, the option that they provide just isn't best for you. For instance, they may get paid to offer you balance transfer credit cards as a debt consolidation option. During times of overwhelming debt, this would not be best. On the other hand, there are some companies out there that are scams and know it! Before signing up for any debt relief service from a phone solicitation, you should research the company name, read a few reviews and decide if it is a company that you want to work with. If so, do some research on the program they offer and decide if it is best for you, only when you feel you have enough information to make that decision. 
• Use The BBB – Although, I do not agree with many of the practices upheld by the Better Business Bureau and, I don't use them often myself, when it comes to debt relief, they are a must. If there is a company out there that is scamming consumers out of thousands of dollars, chances are, they are not BBB Accredited. If they are, they probably have less than a B+ score. If you search the name of the company on the BBB directory and find that they are not accredited or their score is less than a B+, chances are, you do not want to work with that company! 
• Old Rules Still Apply In New Times – There have probably been several times in your life that you said, “If it sounds too good to be true, it probably is.”. This is basic common sense. We all know that nothing comes for free and some things are just too good to be true. If a slick talking salesman offers you a credit card debt relief option that sounds too good to be true, it probably is! Do a bit more research on this one! 

The Bottom Line 

You are a senior citizen, it's time to relax. Unfortunately, there are some people out there that want to make that hard for you. Don't let them! Using the simple tips above, you will be able to protect yourself from credit card debt scams! 

About The Author – Joshua Rodriguez 

This article was written by Joshua Rodriguez, proud owner and founder of CNA Finance. Join the conversation about this article or any personal finance topic of your choice on Google+!