Credit has become a way of life in America. The average American carries over $8,000 in credit card debt, and in 2001 consumers paid almost $50 billion in finance charges. While credit is an excellent financial tool when used wisely, last year over 1.3 million people declared bankruptcy. These numbers reflect the epidemic struggle of our society with debt and the problem will continue until we understand the use of credit and the repercussions of debt.

Unemployment, divorce, loss of a spouse, and bad credit are all major contributors to financial difficulties. Credit counseling can help you to reduce debt, manage your money and may have a positive impact on your credit record.

Maybe all you need is a consumer credit counseling debt reduction plan ... the same type of plan you see advertised on TV and the radio ... where you can reduce payments without filing bankruptcy. We can tell you about that. This type of plan is extremely useful if all you need is to lower the payments on a few credit cards. If you qualify for one of these plans, many of your creditors will stop hitting you with late fees and over-the-limit charges, and will even make positive changes to your credit report, to show that you are now current on your bills.

And if you don't qualify ... there are other options. For instance, it may be in your best interest to lower payments by getting a loan to consolidate some of your bills or by refinancing a debt.

Do you know the difference between a bill consolidation loan and debt consolidation? With a bill consolidation loan, you are borrowing money to pay money. Remember, second mortgages will only increase the amount of money that you owe. Bill consolidation loans often require that borrowers pay additional interest on second mortgages or pay excessive refinancing charges. In the debt consolidation process, you negotiate with creditors to lower payments, suspend interest, and a credit counseling agency can employ additional strategies to help eliminate your debt without making you borrow more money or declare bankruptcy.

There are many differences between a debt management plan and bankruptcy. There are many factors to consider, based on individual circumstances. For instance, bankruptcy is used by people with no way to pay their creditors. However, if you have a reasonable income and have merely fallen behind in repaying your debts - bankruptcy may not be the best option.

If you find yourself in credit difficulties, your best strategy is to contact a law firm specializing in consumer credit assistance and bankruptcy assistance. Contact an experienced credit and bankruptcy attorney today - we can discuss your options, and help you on the way to financial health.