Making the final decision

For many people, a Debt Management Plan is an effective and smart solution if they can afford to pay at least $5 per month and can pay back existing debt within 10 years. It’s worth quickly reviewing the pros and cons.

Pros

• Your monthly outgoings will be reduced.
• You only need to make one payment to your DMP provider.
• Your debt will be paid off in a set time.
• You may be paying less interest and fewer charges.
• You’re not tied to a DMP. If your circumstances improve you can opt out and choose a payment plan that is faster.

Cons

• It will take longer to pay off your debt because each creditor is getting less each month.
• Your credit rating will be affected.
• If you miss a payment your creditors are free to make direct contact with you again

If you’ve taken all these points into consideration and you want to go ahead with a DMP, all that remains is to choose the provider that best suits you.

How to choose a DMP provider

You can find a DMP provider through various channels:

• Contact MyCashOnline team.
• Ask your local Citizens Advice Bureau
• Search for ‘debt management companies’ on Google
• Look in the Yellow Pages under ‘debt management’.
• If you’ve already spoken to an adviser, ask them for a recommendation.
• Ask friends who already have a DMP.

You should be aware that many DMP providers do charge a fee.

A debt management plan can be a great way to get your debt under control and your finances back on track. It’s a flexible option that can be altered to suit your changing circumstances.