By Victor Ochieng
Debt management is a challenge faced by millions of Americans. Once someone gets into debt, it becomes a challenge coming out of it, and some end up going deeper even when it’s not necessary. Some are so badly hit that they run to financial management institutions for help.
While these institutions demand huge sums of money for their services, you can get help from National Foundation for Credit Counseling (NFCC). The organization has been around for 55 years and has been offering free, one-on-one counseling on credit and debt related issues. Some of the areas covered by the nonprofit are student loans, housing debts, outreach to creditors, and credit cards.
A new research released by Ohio State University revealed that individuals who took advantage of NFCC’s Sharpen Your Financial Focus initiative have raised their credit scores and improved their financial behavior. The initiative was launched in 2013 by Wells Fargo, Chase, and Bank of America.
Just 18 months after its launch, Sharpen Your Financial Focus participants have achieved so much, including $17,000 decrease in debt on average; $8,000 average decline in revolving debt; 50-point average raise in their credit score from baseline for individuals making the bottom 25th percentile of participants. This is in comparison to individuals who didn’t participate in any form of counseling.
After undergoing three months of counseling, 67% acknowledged that they’d improved their money management practices; 68% say it helped them create financial goals; 70% raised their financial confidence; and 73% are gradually paying their debts with greater consistency.
“Working together with financial institutions who support financial education, the NFCC Sharpen Your Financial Focus initiative has positively changed American consumers’ knowledge and behaviors related to personal finance,” said Susan C. Keating, NFCC president and CEO. “The Ohio State University research team has provided the most compelling evidence that nonprofit financial education is a catalyst for specific changes that improve financial capability.”
Although there are several other groups and organizations to help you with debt and money management in general, you must be cautious not to fall victim to scammers. If you settle on working with an organization, choose one that has a long trail of successfully working with consumers.
If you’re in debt, there is no better time to start working out of it apart from now. In fact, in most cases, people get into debt for reasons they can avoid.