How to Know When it is Time to Seek Debt Consolidation

by Sachin Wason Digital Marketer

How to Know When it is Time to Seek Debt Consolidation

Many suffers of revolving debt continue to struggle to make minimum payments while never really getting ahead of their debt. In a way, even something like a television purchased on credit over 5 years ago is still affecting the purchaser because the debt was never fully paid off. While the owner of the credit card has made more than the cost of the TV in payments to the creditor, continually putting that debt back off prevents the ability to make payments toward the principal. Because of this, owing money on your credit cards will never end while making only minimum payments.

So what exactly is debt consolidation, and when is it helpful to someone suffering from extreme credit card debt and monthly payment struggles? Debt consolidation is essentially bringing in a third party of experts to help you negotiate with your creditors on a reduced amount to pay off. Debt consolidation companies like Golden Financial Services don’t get paid unless they can secure a lower monthly payment agreement between you and the creditor. If an agreement is made, a fee is charged on top of the new loan terms to cover the cost of the services provided.

The red flags to and general parameters that warrant debt consolidation

Many sufferers of debt trouble don’t even realize there are other options, and therefore have all the hallmarks of classic debt consolidation need without even realizing it. Some classic signs that debt control is needed in personal finances include:

Routinely missing one or two payments per month on recurring bills
Making only minimum monthly payments while also being broke immediately after payday
Buying habits that don’t match your income/buying unnecessary things that prevent bill paying
Sacrificing retirement savings for the sake of paying bills
Negative reporting on your FICO credit score as a result of non-payment
Being unprepared for a tax payment after filing

If you are suffering these symptoms, it might be time to seek help immediately. Golden Financial Services is a Better Business Bureau A+ accredited debt relief and consolidation company, and their knowledgeable staff can cover a wide range of debt types and solutions. Get in touch with them today to discuss whether you qualify for debt help in the form of debt relief or consolidation of your current debts.

Setting goals for getting on top of debt

Some of us just aren’t meant for rigid personal finance control. Impulse purchases can taunt someone already in debt trouble because the feeling of something new is a way to cheer ourselves up, or temporarily distract us from income and debt issues. In fact, mismanaging personal income is the #1 way Golden Financial customers end up seeking help. Sometimes a simple structure to follow can make all the difference in this situation. Here are some steps to get on the road to debt recovery:

Calculate your income versus your debts in a Budget Calculator
Review your monthly bank statements, and track down expenses that are unnecessary
Cut out excessive spending like unused cellular data plans, premium entertainment packages, and dining out
Create a budget, after all debts are accounted for, that can be used for non-essentials and/or debt pay
Use a debt snowball calculator to see what impact you can make on your debt accounts
Seek debt consultation from professionals when the first 5 steps aren’t working

For more steps on managing debt, give this a quick read.

Changing negative thought patterns

Yes, negativity can be in the form of self-doubt, or they can be about how you feel the world is against you while you are just trying to live an average, positive life. But have you considered negative thought patterns that have nothing to do with self-reflection? These thought patterns are mostly excuses like, “I can pay for this later if I use my credit card today” and “I’ll find the money for this later because I want it right now.” Tackling debt requires a change in mindset, not just income.

The income you have now is not the sole cause of your debt, because responsible spenders can properly stay within their means to achieve financial freedom. If you are reading this looking for help while in extreme debt, you got here because you ignored the warning signs and purchased something with credit that wasn’t necessary for everyday life. You must control these impulses, and then get to work on increasing your income.

Avoiding scammers and fakers

There absolutely are companies out there that claim to be a lifeline when you need extreme debt help, only to leave you high and dry by securing a debt settlement that you cannot afford while taking their fee and taking off on you. In this scenario, you are sacrificing your future and possible retirement for the sake of what seems like legitimate help now.

It is so common in personal finance circles that there are actually “classic” tactics for this time of scam. Most debt consolidation companies, for example, will not contact you asking for personal information that would compromise your identity. They will also not send you an email asking for any information that would pre-qualify you for debt consolidation. Speaking of pre-qualification, predatory loan companies frequently send out physical letters in the mail that claim you have been pre-qualify for a loan. If you know you have terrible credit and are struggling with debt, you should know that this is a predatory tactic. The company truly hands you a loan, but the terms of the loan will be heavily beneficial to the loan company, and you likely won’t survive the duration of the loan terms. Avoid these at all costs so you don’t perpetuate your debt issues. The last thing you need when you can’t afford minimum payments is to add another debt to your monthly slate.

Get in touch

Thinking of seeking debt consultation? Golden Financial Services is a national debt relief bbb rating company with over 15 years of being in business. Their A+ BBB rating has been achieved through hard and honest work. They specialize in helping debtors get back on their feet and only succeed when the client succeeds.