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What to do if you’re in way over your head?

A PearBudget user asked a question over at Yahoo! Answers about getting out of debt, and finding resources to help them make sense of the situation they’re in. I posted an answer there, but figured I’d re-post it here, in case it’s helpful to any of you.

Their question:

“Hi! I have set up a budget with pear budget but we really don’t know how to go about spending our budget or acting on it. We went to a credit counseling place that originally said they could help with our budget but when we got there all they wanted us to do was file bankruptcy or consolidate our credit cards. They were truly not helpful. Is there anyone out there who helps people with this sort of thing. We are desperate for help with this. Thanks a bunch!”

My answer:

AVOID the for-profit credit counseling places. The ones that advertise on the radio? They absolutely do not have your best interests in mind. They are businesses and are looking to profit off of you.

There are some credit counseling places that are reputable, though. I don’t have any experience with them, but I would check out the National Foundation for Credit Counseling ( to see what options they list. Be wary, though. Getting out of debt takes a lot of work, and any counselors that promise to do it “easily” (file bankruptcy!) are counselors you want to avoid. There’s a really good list of questions at that go over the things you should look for and ask of any services you’re considering using to help you make a “Debt Management Plan.”

I would also recommend listening to the Dave Ramsey show (online or on the radio), and checking out his books from the library. He has some great advice.

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