Unfortunately a few bad apples have given debt counseling a bad name. First of all, do you know what debt counseling is? Do you know who debt counseling is for? In piling up a mountain of debt you probably have made horrible decisions trying to shield yourself from the harassment of perpetual phone calls from debt collectors and in vain attempts to take the debt pressure off.Looking for a quick way out, many people decide to file for bankruptcy or apply for consolidation loans in their efforts to minimize their debt. Neither choice may be the right one for you at this point. But how will you know? If this is an emergency or a chronic sitaution you find yourself in debt counseling may be your answer.

Frankly, the right time for some legitimate debt counseling is now. Why wait? Debt counseling can help you with a logical approach to the management of your current debt. Professional counselors work on an individual basis so that you can create a repayment plan that makes sense in your own situation. The plan is communicated to each of your creditors and each of them will be paid a percentage of the amount of the debt owed over a finite period. A debt counselor also will teach you how to manage debt and how to establish a reasonable budget for you to live with. In other words, you will have a disciplined approach to looking after your own finances and you will learn to control the spending habits that got you in to this mess in the first place.

Rather than taking some of the more radical debt solutions available like bankruptcy, debt counseling will not only deal with discharging existing debt but the good debt counselor will define a complete set of life changes in order to achieve and then maintain your financial stability in the future. Determining whether or not you need debt counseling starts with a complete down to earth appraisal of your current finances. The counselor will show you how to create a budget and how to relate your bills to your income. Part of the work is to prepare a list of what you owe to every creditor including all credit cards as well as the rate of interest you are paying on each. You'll need all the credit card statements you can lay your hands on plus any other debt notices, etc.for both secured (mortgage/home equity) and unsecured (credit card)loans.

Once you have assembled all the data on the current state of your financial affairs, ask yourself these questions:

Do you have many credit cards?
Have you made a habit of applying for cards every time offered?
Heve you then run those same cards up to the their limit?
How many of your cards are near or at limit?
Can you only afford to make the minimum payments on your credit cards each month?
Have you made at least the minimum payments each month?
Have you made any payments over the minimum in recent months?
Do your average bills add up to more than your monthly income?
Have you been frequently late with credit card payments?
Are creditors calling you frequently?
Have you developed a plan for dealing with your debt?

If your savings are nil or very low, your credit card debt is out of line with your income and you are finding it difficult to make payments on time, then yes, you do need debt counseling. Finding the right debt counselor is the next step and that's a subject for another time.