Jack, 27, is a young professional working with a software company. As he started earning well, he grew more and more friendly with his credit cards. He started making huge purchases using them and the habit of postponing payments increased his debt burden. Finally, he was in a fix and unable to find any solution to deal with this big debt. One of his friends suggested that he seek help from credit counseling agencies in this matter. Now, what should he be aware of, before approaching them? Let us discuss this in the next few paragraphs. Jack is not alone, there are thousands like him who strain their finances beyond limit and get into problems due to poor financial planning and lack of good savings. The duty of credit counseling agencies is to strike a deal between debt-ridden customers and their creditors, which will help people get easy repayment plans and help the creditors get their money back. Here's an analysis of the pros and cons involved in opting for these counseling agencies. Pros and Cons The biggest advantage of consumer credit counseling services is that they negotiate for a better deal with creditors, on your behalf. So, if you have taken multiple loans, the counseling agencies can help you to combine all of them into a single loan. These agencies can also help you reduce the interest rate that you are paying on credit card debt. Usually, it is the high interest charged on credit cards which makes repayment difficult for most. Banks and financial institutions, who issue credit cards, charge a lot of money as late fees, if payments are not made on time. The counseling companies can intervene in this regard and reduce the late fees for you. It will be possible to reduce your burden through debt management plans which will be arranged for you, by these agencies. The repayment options made available to you will be flexible. As you pay your debts slowly and steadily, your credit score will improve simultaneously, and so will your relationship with your creditors. Once your creditors are assured that you are trying your best to repay their money, then you will not be receiving any recovery calls from them, which in itself, is a big relief. We should also talk about the disadvantages of approaching these counseling services. Many times, it has been observed that mismanagement on part of the counseling agencies causes heavy losses for the credit card holders, thus causing more problems, instead of solving them. The credit report of the consumer can be even more messed up, because of such mishandling. All the facilities promised to you by your counseling agencies may not be fulfilled and this will be detrimental to your interests of bringing your finances back on track. Proper financial management along with good savings ratio and wise credit card use are the keys to make yourself financially stable. Analyze all the pros and cons involved, before opting to take help from counseling agencies.