You are being charged for your Debt Management Plan because you are most likely using the services of a company who provide this plan on your behalf.
Typically these Debt Management companies will take a percentage of your monthly payment meaning not all the money you pay is going towards paying off your debt. Depending on how much they are charging for their services, you could be in debt for longer than you need to be. I wanted to be out of debt as quickly as possible so paying for Debt Management was not an option.
Personally it is difficult to see why someone would pay for a Debt Management Plan but at a guess there must be some reason why as these companies wouldn’t exist otherwise. Maybe people are not aware that there are free options out there, or perhaps they have used the services of the companies who provide the service without charge, only to have a problem.
I currently manage my own plan and it is working out quite well, although there is a bit of work involved keeping on top of things. It does mean that every penny I pay goes towards my debts, which is a good thing considering how much debt I have. It also means I have complete control over all the payments and can make sure none of the payments I make go astray. If you have already tried a free debt management plan and it wasn’t for you, please visit the Debt Help Section of this blog to see alternative options.
I also started this blog as well so I must stick to managing my debt myself, otherwise I wouldn’t have much to write about!
Here is some more information about Debt Management Plans
Below I have provide links to some posts that have written on this blog in relation to Debt Management Plans. Included are details on where you can get a free Debt Management Plan, along with looking at the pros and cons of this type of debt solution. There is also a comparison between paid for plans and free plans as well as explaining how you could set up your own plan if that’s something you would like do.
Where can you get a Free Debt Management Plan that doesn’t charge you for their service?
The two organisations below can also provide you with a free Debt Management Plan. There is no sense in paying for one when you can get one for free. That way all the money you are paying is going towards your debt. It could reduce the amount of time you are in debt, and that’s a good thing.
– StepChange Debt Charity
The organisations listed above can also advise you on alternative debt solutions, should they be a better option for you. Visit the Debt Help Section of this blog to find their contact details.
Let me know your thoughts on paying for Debt Management Plans
Are you paying for a Debt Management Plan? If so why have you chosen to? Have you used one of the free Debt Management Plans in the past and did it not work out? Please share your thoughts in the comments box below.