I want to pose the question:? even if that’s possible,? is it smart?? What do you forgo in that scenario?

If it’s travel; lattes; and premium cable, I’m OK with that. But, if what you do without is emergency reserves; health insurance; and retirement savings, I think that a poor choice.

Whether financial difficulty was caused by bad luck or bad choices,? don’t make a bad decision, driven by pride, to compound the trouble by living without a safety net.

Too many of my clients arrive in my office with the conviction that they incurred this debt and, by damn, they want to repay it.? At some level, I applaud that desire.? But what are the likely consequences of repaying that debt if it means making no provision for financial stability now and in the future?

Part of reforming your financial situation involves looking beyond this month’s bills to the needs of the next decade and beyond. Lots of folks got into credit card debt focusing on their ability to make the monthly minimums, rather than on their ultimate ability to pay the debt off.

Particularly in times of profound economic uncertainty, consider the merits of a fresh start and a plan for financial self sufficiency.

Credit Counseling Agencies. Taxpayers should be careful with credit counseling organizations that claim they can fix credit ratings, push debt payment plans or impose high set-up fees or monthly service charges that may add to existing debt. The IRS Tax Exempt and Government Entities Division is in the process of revoking the tax-exempt status of numerous credit counseling organizations that operated under the guise of educating financially distressed consumers with debt problems while charging debtors large fees and providing little or no counseling.

The debt settlement model heads my personal list of scams, since it so seldom produces any meaningful settlement, provides no protection to the consumer while the money is accumulating, and lines the pockets of the organization in the meantime.

This is the industry that Congress made the gatekeeper to bankruptcy for individuals. Go figure.

Cathy Moran