If you ask me the benefits of a debt management program, I can give you a long list. This is because I am a credit-card-debt woman who has been in AKPK’s free debt management program for one year.

Wow, it’s been a year since I started making monthly debt repayment to AKPK! You know, I have also been able to save extra money in my personal savings account as emergency fund due to the debt management plan.

A debt management program is one of the many debt relief options that a credit counselor might suggest when you’re having issues with credit card debt.

It is also a good option if you don’t want to apply for a debt consolidation loan or declare bankruptcy.

Okay, let’s see some of the benefits of enrolling in a debt management program.

1. Reduced Interest Rates. Once enrolled in a DMP, your credit counselor will negotiate with your creditors to reduce your interest rates.

Interest rates will vary depending on your situation and your creditors, most rates are between 2% to 9% and under certain circumstances, some creditors may completely eliminate their interest rate to 0% interest.

2. One Single Payment. Instead of making multiple credit card payments on various due dates, a debt management plan enables you to make ONE payment to One agency on ONE due date.

I will never forget those old days when I had to run 6 banks to bank in 15 credit card payments!

Now I only need to make one payment to the credit counseling and debt management agency’s collection account by the end of every month. The single monthly payment will then be distributed by the agency to the creditors.

3. Waived Late Payment Fees. If you have late payment fees for delayed credit card payments, the credit counseling agency will help you negotiate with your creditors to waive them.

4. Creation of a Budget. The program you choose usually will help you to organize your personal finances with the creation of a budget. In this way your credit counselor can make sure that you are able to make your monthly debt repayment on time.

5. Peace of Mind. With the help of a debt management plan, you are able to start organizing your money and seeing how the amount of debt reduces and your personal savings increases.

Of course, there are disadvantages of enrolling in a debt management plan too. Before you decide if a debt management program is right for you, check the other debt relief alternatives and balance the advantages and disadvantages.

Since I started credit card debt reduction in April 2007 and later enrolled in a free debt management program in October 2008, I have become used to cutting back on spending to save money for savings and emergency funds.

At first, it was very difficult for me to control every cent and dollar and stick to a budget. I was so used to spending money like water all these years, so logically speaking, I really needed time to change my spending habits.

Fortunately as time went by, the habit of limiting my spending seemed to develop and work automatically.

If you are in debt and hoping not to end up in a debt management program, then you have to start cutting back on your spending and sticking to a budget by trying a few practical changes that you can make everyday.

You’ll be amazed that you can actually cut your spending more than you expect by simply making some minor changes.

1. Pack Your Lunch Every Day. Having lunch at restaurants or food courts is definitely more expensive than bringing your own lunch.

By bringing your own lunch, you can save several dollars every day, which will add up over time.

2. Use Your Cell Phone During Off Peak Hours. Are you one of those people who spend a couple hundred dollars a month on phone charges? If so, lower your phone charges by making most of your calls during off peak times.

Check with your service and plan to find out when you have cheaper or unlimited calls.

3. Start Clipping the Sunday Newspaper Coupons. Stop throwing away your Sunday newspapers, what a waste! Instead, skim through the advertisements for coupons and sales.

Although the process of clipping coupons is tedious, the savings are often worth it due to the fact that more and more stores double or triple the amount of their coupons.

This technique can save you up to 20 or 30 dollars each time you head to the food store.

To be honest, I used to sneer at the idea of cutting back on spending that saved a dollar here and there. How could saving a dollar here and a dollar there help me pay off credit card debt?

Well, the truth is a dollar here and there really adds up in long run. Changing your spending habits does save you much money.

This morning, I went to cash out Google AdSense earnings at a nearby Western Union agent. Guess how much I made from Google AdSense last month?

It’s almost $300! $300 X RM3.48 was more than RM1,000.

But my happiness was short-lived. After stepping out from the bank, I had to use the money to pay the overdue home loan installments and utility bills.

There went my Google AdSense earnings.

It’s my wish that my Google AdSense money keeps increasing, from current $300 a month to $600 a month and then $900.

In March 2008, I mentioned in one of my blog posts that “how I wish I could make $108 monthly.” Well, I did it.

I am now making almost $300 a month from Google AdSense. I know it’s going to take some time to reach my goal of $900 a month, but I believe it’s possible.

If my Google AdSense earnings alone can’t reach $900 a month, I still have commissions from Chitika and Amazon.com to help hit $900 a month.

$900 is equal to more than RM3,000, you know. I am sooooo looking forward to receiving RM3,000 Google AdSense earnings every month to increase my savings cum emergency funds and speed up paying off my and hubby’s credit card debts.

At last, hubby has started his work as a full time high school teacher with effect from 1st of July. My wish of him having a stable full time job has come true.

I must have God to thank for because He answered my prayer.

With hubby having a full time job, this means there is RM1,500 to pay some bills, pay off some personal debts from close friends and save for emergency funds.

Hubby’s current pay is only $1,500 per month because he is only given 15 classes per week to teach. There aren’t enough classes for the time being because it’s middle of the year now.

Although hubby’s salary is RM1,500, he is still considered a full time teacher. You know, he will be entitled to a month’s bonus!

If hubby is sure that he wants to be a discipline master after 2 months, he will have extra RM400.

Next year, it’s expected that hubby’s salary is between RM2,000 and RM2,400.

Let’s look at my current income from my niche blogs and tuition classes. I think they bring roughly RM2,500 per month.

Both of our income adds up to RM4,000! Wow, …

With RM4,000, we can pay my AKPK RM320, hubby’s AKPK DMP RM360, car loan installment RM820, home loan and bank overdraft interest fee charge RM520 and utility bills RM250.

Extra money will then be used for daily expenses and saved for emergency funds.

Have you been told that your credit score will be badly damaged if you are in a debt management program? Well, I was told many many times about it and was advised to DIY debt management myself without the help of credit counseling agency so that my credit score wouldn’t get hurt.

At that time when I was thinking about getting out of credit card debt with a free debt management program, I was already a few months behind my monthly payments and wasn’t able to pay the minimum payments.

Not only were there non-stop phone calls and letters from banks and creditors, I started getting phone calls and visits from third party collection agencies!

If you had been in my shoes, would you have thought about credit score or cared if a a debt management program would damage your credit score?

I didn’t care. What I wanted to do at that time was to get into a shelter for a temporary relief; a credit counseling and debt management agency for a temporary financial relief.

I needed to enroll in a debt management program that could consolidate my multiple credit card payments into one payment and stop all the harassing phone calls, warning letters, third party collection agencies, exorbitant late payment fees and over-limit charges.

Since I was put in the free debt management program in October 2008, I have been able to heave a relief. Paying ONE smaller monthly payment to ONE credit counseling agency on ONE due date enables me to save more money for the emergency funds and pay my credit card debt without much stress.

It’s true that if you have loads of debt but are current on all your payments, your credit score may drop when you enter a debt management plan.

But if you have several late payments or are currently way behind on any credit payments, chances are a debt management repayment plan actually improve your score.

Enrolling in a debt management program is a long term decision, and the fact is repaying your debts is the best thing for your credit score.

This is the continuance post of Read Others’ Experiences Using Debt Management Programs – Part 1.

Once it is determined that you are eligible for a debt management program, your credit counselor will negotiate with your creditors for lower payments and interest rates.

Instead of making multiple credit card payments to different banks and creditors on various due date, a debt repayment plan enables you to make ONE payment to One agency on ONE date.

You start making payment to the credit counseling agency’s collection account and the monthly payment will then be distributed out to your creditors.

Take the late payments or insufficient funds seriously! They can cause your debt management program to become null and void, so be in time or on time when it comes to making your monthly repayment.

While in the DMP, you can’t apply for any new credit cards or loans. I have been living without the convenience of a credit card for more than 7 months already.

I have been told by my counselor that I can make extra payments to some of the large credit card balances while I am in the program. Just make sure that I have some emergency funds before I go to settle a large credit card balance.

If your debt is up to your ears and you are looking for debt relief options to bring relief, a debt management program can be just what you need.

The Federal Trade Commission (FTC) has very useful information about using debt management programs (DMPs) effectively and about how to know if the program is legitimate.

Hubby is closing down his foot biz after barely six months in business; the foot reflexology center was opened in January 2009.

There are various reasons that have brought to the closing down of the center.

First off, hubby hasn’t done much when it comes to marketing and promoting his foot biz. This has got to do with his own personality; he loves staying low profile.

As you know, being successful in biz means that you need to be able to mingle with different types of people and entertain boring people and conversations. He just simply isn’t the type of man who wants to waste his time on nonsensical or gossipy topics.

It’s true that hubby has some regular customers that can bring him a few hundred dollars every month. But with his already painful right arm, he will have to stop doing foot reflexology sooner or later. Instead of waiting for his right arm to stop functioning, it’s better for him to stop now.

Hubby has a better career option if compared to being a foot reflexologist. He used to be a high school teacher for more than 10 4 years in his early thirties.

Recently, he was persuaded to teach again in the same high school. Hubby has not made up his mind because he is considering a few more high schools.

Honestly, I prefer hubby to teach at a high school that is nearest to the house. This way, we save money on petrol and car maintenance. Most important of all, hubby doesn’t have to waste time on driving to and fro.

The last reason is the most important reason why hubby must stop his foot biz and join the teaching force again – stable income. Being a full time teacher means there is a steady monthly income from hubby, approximately RM2,000.

My online income of RM2,500 is unstable in this volatile economy. There are days that I earn more because of better Google AdSense earnings or online assignments and there are days when there are fewer reviews to write or late payments from the advertising companies.

Due to my unstable income, there is a need for hubby to have a full time job to generate a stable income to ensure that my AKPK debt repayment, hubby’s AKPK debt management program repayment, our car and home loan installments are paid on time.

Our free debt management programs (DMPs) require that we pay our debt repayments in time or on time, otherwise, the debt management plan agreements will become null and void.

I am praying to God that hubby accepts the right full time teaching job soon. The sooner he starts work, the faster he can pay off some personal debts he borrowed from his buddies and the safer I feel with extra cash in hand or money saved for emergency funds.

It just dawned on me that I am living on CASH only now. I use cash for everything from buying groceries to paying for the petrol to making payments to debt repayments.

I have NO MORE CREDIT CARDS. I am now a credit card debt woman who doesn’t even have a credit card. Of course, my debt is still here.

I feel good. Feel good that there are no chasing calls from banks, creditors and third party agencies. Feel relieved that there are no more exorbitant late payment charges, 18% finance charges, and ridiculous retail or cash advance fees.

Because of being placed under the debt management programme, I have a bit cash left in hand or saved as emergency funds now.

As the saying goes, “A Penny Saved Is A Penny Earned.” Small penny and dollar savings do add up in your ceramic piggy bank.

With bad economy and drawn-out recession, a penny is as important. That penny becomes 99 more, and it becomes a dollar.

I started stuffing some spare change into my ceramic piggy bank today after watching the video on How to Save More Money in 2009.

Today is the 8th of February. This is the first day I inserted a few small notes into my piggy bank. In future, I will slot in coins as well.

Instead of letting small amounts of spare change slip through my fingers, I want to try the traditional way of saving pennies and dollars.

Small amounts of money can quickly add up to big savings. Big savings for my goal of $1,000 emergency funds.

My 2009 New Year’s resolutions are saving for emergency funds, making more money and paying off credit card debt.

I am sure my resolutions for new year are same as yours and lots of people out there.

According to a survey by Franklin Covey, paying down debts is the No.1 New Year’s resolution made by many consumers.

You are lucky if you can help yourself to reduce the debts without getting any debt relief help. This means you are among the vast majority who can just take a DIY approach to reduce your debts.

Only the bottom 5% are distressed enough to resort to getting help from credit counseling or expensive debt settlement companies.

As for me, I belong to the bottom 5% who was distressed enough to get help from a debt management company.

My debt management program was approved in October 2008. The monthly repayment amount is so affordable that I have extra money to save for emergency funds.

It’s a FREE debt management program.

Is paying down credit card debts your No.1 New Year’s resolution this year?