Debt relief assistance programs or simple changes in financial habits of certain consumers may be the reason that we have seen recent reports that, as of August, consumer debt from both non-revolving and revolving credit and decreased, which many feel to be a sign that consumers either can’t or won’t spend and, as a result, may be hindering certain areas of the economy from recovering. Yet, there are arguments that consumers must find a stable financial ground before they can begin to safely return to the world of consumer spending, and this is where there may be benefits when it comes to different debt repayment programs that can help consumers reduce excessive debt levels, and potentially set them in a position where they may be able to buy, charge, and ultimately better repay debts in the future.
Arguments continue to surround the fact that consumers who are hesitant to spend or unable to spend are obviously causing a reduction in demand and, since businesses may be seeing fewer profits, this is leading to unemployment levels remaining as high as they are, despite the fact that there were still some jobs added in September. It’s common sense that consumers cannot contribute to the economy if they are crushed under debt and financial burden, so those who have either face a period of financial distress as a result of joblessness or are currently unemployed are often focusing on paying down their debts, as some argue these decreases in credit may be the result, in part, of consumers paying down what they owe.
However, when it comes to getting out of debt, many debt relief assistance programs may help consumers reduce their overall debt levels, but this will obviously take homework on the part of each consumer as to how their specific debt situation may benefit from certain programs. In many cases there are simply budgeting and savings solutions that can be beneficial but some consumers have had to go so far as to even use a debt management program, speak with their creditors about hardship assistance payments, or some consumers have had to go to the point of working out a debt settlement agreement lest they completely default on their obligations.
What consumers must remember is that addressing problems as soon as they arise will give more room to work for not only do these debt repayment programs, but credit counselors or creditors may be more willing and able to help consumers find solutions to their debt troubles. Obviously, if a consumer is in a position where they have lost their income and cannot honor their debts this will be a substantially different situation than if a consumer has simply spent in excess and cannot pay what they owe at the present time.
Yet, the problem remains that many economists feel consumer spending must strengthen before jobs will be created as a result of demand and purchasing, but consumers who are facing various financial hardships are obviously in a position where they must look out for their best interests, in terms of avoiding financial setbacks and damage to their credit, and this is where some debt repayment programs have benefited these men and women in the past but, will hopefully set them in a position where burdensome debts will no longer be a problem once these debt repayment assistance plans have helped.