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With the economy constantly in flux it’s becoming more and more common for the average Canadian to need some type of financial assistance. Living paycheque to paycheque and cautiously waiting for the dreaded call from a debt collector have become the norm. If you feel like you’re finances have steadily become too much for you to handle and you’re debt is piling up, you might want to consider seeking the professional help of a credit counselling agency. Managing your own finances on top of everything else you need to accomplish on a daily basis can be extremely difficult. This is why there are trained professionals willing to help you get back on track and regain control of your credit.

Is Credit Counselling The Best Option For Me?

This is a decision that you need to make for yourself. But if your debt has gotten out of control and you have no idea where to start, asking for help might be exactly what you need. The great news is that by admitting you have a debt problem you’re already one step closer to finding a solution and getting back on track.

Before you contact a credit counsellor you should make sure you know exactly what to expect. Being as prepared as possible will make the whole process a little bit easier to handle, ask yourself the follow questions to make sure you choose the best debt relief option for your situation:

  • How much will credit counselling cost and is it worth it?
  • How will credit counselling affect my credit?
  • How long will it take to become debt free?
  • Will credit counselling teach me how to manage by finances more responsibly?

Once you’ve answer all of these questions as honestly as you can you should have a better idea about how you want to tackle your debt.

How Does Credit Couselling Work?

Legitimate credit counselling agencies assist their customers in the management of money and debts. This is achieved through financial advice that will then provide a base for future financial decisions. Your credit counsellor will enable you to make independent plans that are within your financial capabilities by offering advice on budgeting, credit and debt. A credit counsellor will also help you to execute any plans that you make. For example, they can help by contacting your creditors to renegotiate your interest rates.

Another effective solution offered by credit counselling firms is the debt management program. In this program, a customer pays deposits to the credit counselling organisation, which it uses to finance an individual’s unsecured debts on their behalf. The agency will also provide a payment schedule that accommodates the input from the customer, his or her creditors as well as the financial adviser.

Advantages

Working with a credit counsellor will not only provide you with the peace of mind that you’re finally taking back control of your finances, they will:

  • Teach you how to create a realistic budget and then stick to it. A budget could potentially provide you with the stability you need to avoid other more damaging debt solutions like consumer proposals or bankruptcy.
  • Negotiate on your behalf with your creditors. Your counsellor will get in contact with all of your creditors and try to lower your interest rates as well as renegotiate your payment plans. These two changes will reduce a lot of the stress associated with your debt.
  • Prepare you for future financial issues. A credit counsellor can provide you with tips and tricks that will help you better handle all your future financial issues.

A credit counselling agency can empower you to make more practical and effective financial decisions, provide you with the budgeting skills you need and facilitate the establishment of long-term financial goals. Credit counselling agencies have the capacity to provide financial management programs that are unique to every customer’s financial practises. This enables the accommodation of any and all financial challenges that are experienced when using credit or borrowing money.

Get The Help You Need

In addition to all these dependable and effective solutions, credit counselling offers a source of financial information. Signing up with credit counselling agency opens a direct avenue to know how financial operations are undertaken such as the calculation of interest rates, financial practices that can attract debt collectors, how to file for bankruptcy and even lucrative investment options. This enables the customer to understand how finances are analysed and managed.

It’s important that you take the initiative and make the first step to protecting yourself from further debt as well as financial ruin. Seeking the help of a credit counsellor will allow you pay back your debts and take back control of your financial life.

Caitlin Wood, BA avatar on Loans Canada
Caitlin Wood, BA

Caitlin Wood is the Editor-in-Chief at Loans Canada and specializes in personal finance. She is a graduate of Dawson College and Concordia University and has been working in the personal finance industry for over eight years. Caitlin has covered various subjects such as debt, credit, and loans. Her work has been published on Zoocasa, GoDaddy, and deBanked. She believes that education and knowledge are the two most important factors in the creation of healthy financial habits. She also believes that openly discussing money and credit, and the responsibilities that come with them can lead to better decisions and a greater sense of financial security.

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