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Suddenly Struggling with Debt

You’re responsible. You’ve always saved your money, paid your bills, held down a good job. You’ve made a budget and stuck to it—and if you splurged now and then, you were always able to pay it off. But suddenly, something changed. 

Maybe interest rates skyrocketed. Maybe you’ve unexpectedly joined the ranks of the 9.1% of Americans unemployed right now. Maybe you thought your family could get by on one income, so you stayed home with the kids. Or maybe you got a little complacent when it came to that budget. 

And so here you are, suddenly struggling with debt. We understand. It happens to lots of people. But don’t waste time beating yourself up—get busy fixing the situation. 

First of all, it’s important to admit what’s happening. Many people have trouble acknowledging that they’re in debt, especially when they’ve never struggled with money before. There’s shame and stigma attached to money troubles—but there shouldn’t be. Often, debt is the result of an outside factor that couldn’t be predicted. So even if you’re telling yourself you have it all figured out, that you’re reading this article out of curiosity, or for a "friend," take a good hard look at your finances, take a deep breath, and take control. 

Once you’ve admitted you’re struggling with debt, you can start thinking clearly about a plan to get out of it. You’ve come to the right place: Our article library has tips on pretty much everything related to debt and living debt-free. Browse our virtual stacks and you’ll discover information about budget planning, taxes, mortgages, and other areas of debt management. You’ll also find money-saving information on day-to-day situations like coping with gas prices, making sense of health plans, and surviving the holidays without debt. The article library is a great way to start taking control on a macro and micro level. 

If you’re having trouble making payments on time, getting calls from creditors, or are considering bankruptcy, you need bigger guns in your fight against debt. In that case, you may want to consider a Debt Management Plan or Debt Settlement Plan with a provider like CareOne. 

Debt Management Plans (DMP)

DMPs help you pay off your debt in consolidated monthly payments. After three on-time and consecutive payments are made, creditors usually agree to lower your interest charges and reduce the amount of payments. A DMP will stop collection calls and lessen the overall amount you’ll have to repay (although you’ll still be responsible for repaying the principle). You’ll also avoid late fees. You’ll need to make consistent monthly payments though, and can’t take on new debt while you’re on the program. 

Debt Settlement Plans (DSP)

DSPs are an alternative to declaring bankruptcy. On this type of plan, you’ll make monthly deposits into an FDIC-insured account, not to your creditors. Meanwhile, your provider will negotiate with creditors for a pay-off amount you can afford. When an amount is reached, it will be paid from your settlement account. This method can drastically reduce your total amount owed. Payment arrangements are more flexible and, of course, you’re avoiding bankruptcy. But your credit profile will be affected and you can be taxed on the part of your debt you don’t pay back. 

DMPs and DSPs are powerful weapons against debt. We’re happy to give you more information so you can find out if we’re the right provider to have by your side. 

However you choose to fight your debt, CareOne is here for you if you need us. Our articles, community, and plans are ready for you when you’re ready to fight. Take action now—and start planning a debt-free life.




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