Everyone has debt; that is a fact of life. It is part of the American dream. The average person carries approximately $10,000 in credit card debt. As long as you have a decent job keeping up with your debt can be fairly easy, but what if something happens? What if you are downsized, go through a divorce, even depression? What happens when the debt begins to take over? How do you recover and return to the way things were?

When debt begins to rule your life, there are a flood of emotions you begin to experience. There is confusion on how you got in this situation. Fear on what you are going to do, how you will make ends meet. If you have a family, what happens to your family? There may be anger toward yourself on letting yourself get to that position. There is even depression. I know there are many more emotions, fears, and concerns that I have not mentioned, mainly because I have not experienced it myself. What we need to remember, is that there is hope, things do get better, but you need to start to take control of the situation. Instead, of letting the debt crisis control you, you need to take control of the debt situation.

Let me give you a little background on myself, because I am just like everyone else. I don't have all the answers, but I have been there, still there, and beginning to take control of my situation. I once had a life that was the American dream. My wife and I had great jobs, bringing home in excess of $125,000 per year. We had a nice house, a mortgage we could handle, nice cars and enough money to do pretty much what we wanted when we wanted to. Then the divorce. My life was shattered, income cut in half, depression set in and my job was gone. The debt began to mount. I developed a compulsive spending habit and again the debt continued to rise. The new job I got was a commissioned job, why, the best paid people are commissioned sales people. The company did not deliver on their promises and I went 6 months without pay.

All this is what got me into approximately $100,000 of credit card debt. Yes that's right, $100,000, 6 figures. I finally got a new job, this time Financial Consulting, small base $2000.00 per month and commissions. The difference is that I have been in the finance and banking industry since 2001. I am a good Financial Consultant, so I do see a commission check. Sometimes not as much as I need, and other times, more than I need. Looking at just my salary, it is a take home of $1000 per month, my mortgage is $1200.00, car payment at $328, and minimum payments on my debt was $1800 per month. As you can see a negative cash flow. So what do you do? Take control of the debt, that's what I am doing. But how do you take control that was the question.

There are a couple of ways, borrow from friends or family, debt consolidation or debt settlement. In my opinion debt consolidation is the best, who wants to borrow money from their family and friends. Your last resort is debt settlement, but there are things you need to be aware of with debt settlement. First how it works.

With debt settlement you stop paying your creditors. You make one payment to the debt settlement company and they put some of the money into a trust. Once enough money accumulates they call a creditor and attempt to make a deal, by having them accept less than you owe to cancel the debt. There are non profit and for profit settlement companies. The for profit companies, charge a percentage, in my case approx $20,000 to complete the program. The first 6 months, $140 of my $1,152 payment went to my trust and the rest went to the settlement company. The next 60 months $891 would go to my trust. They tell you that they will send a letter to all your creditors stating they are representing you and to stop all correspondence with and begin it with them. This does not work, you owe the creditor and they will still call and send you letters. The whole time, they are charging you interest and penalties on your debt, thus creating more debt. The creditors still can sue you if they want and some do. If you own property they will put a lean on your house, which only means if you sell the property, they get their money before you get yours. You will still get calls and letters.

Now non-profit settlement companies are what you want to try first. The biggest thing is that payments to the creditors do not stop. The company will help negotiate a payment plan for you, this too will lower your payments. Penalties will stop, interest rates will be lowered, and you still make the payment to the settlement company, and they disburse payments each month to your creditors. Here is the great thing, the one I found, their fee was $50.00 set up and $25.00 per month. The rest goes to the creditors. Check your local phone directory for a non-profit company.

Wisconsin has a little known law called Chapter 128. It is a court ordered payment plan in which the creditor is barred from charging penalties and attempting collection of the funds. The plan is set up to be paid off in 3 years or less. By far the best way to go if you can.

Unfortunately, I could not, and the non-profit could not work with my income or debt. What helped me was the representative with World Financial Bank, she told me the ins and outs of debt settlement, and they worked with me to come up with a feasible payment plan. I have found if you keep in contact with your creditors, they will help you, lets face it bankruptcy means they get no money, so it is in their best interest to work with you. Also a collection company also told me this, I could do what the debt settlement company could do. You see they reach a settlement price say .50 cents on the dollar and they tell you it is .65 cents on the dollar. They get their fee and more. If you had a lump sum and called the creditor you could make the same deal. I found this out this way. The collection company said they were able to settle $12,000 worth of my debt for $6500. I went online with RBS, at rbspayassist.com, and my lump sum settlement was offered to me at $5208.

In summation, if worse comes to worse, pay your mortgage, car and living expenses. Keep your family and house going, and stop paying the credit card companies. Call themin 3-6 months, that's when they will talk to you and help you, not before. If you come into lump sum money, make your own settlement. If you can't make a deal right away, do what you have to do, take care of yourself and family. In time, you will be able to make a deal, whether it is for the full amount or less, you will make a deal. So there is hope and eventually you will see light at the end of tunnel. Just don't give up. If you get depressed and scared, talk to friends or clergy, they are there to support you, and they want too. You can do it. It's not going to be an easy road and it will be a process, but I do see the light, and future looks bright. Good Luck to all of you and God Bless.