Soaring unemployment rates paired with wage reductions may have made it more difficult for consumers to remain current on their mortgage and credit card payments. A recent release by credit counseling company A New Horizon offered insight into some of the struggles faced by Americans as the country emerges from some of the most challenging economic conditions since the Great Depression.
"The root problem and cause of many financially challenged and 'debt heavy' individuals usually stems from credit card abuse," the release said. "The ability of many American families to live beyond their means can create an out of control debt situation requiring special assistance from creditors."
A recent report by market intelligence provider Mintel Comperemedia showed that 36 percent of Americans faced difficulty when paying off their bills during the past two years. Higher rates were reported among black respondents, while those living in urban and rural areas also found it more challenging to remain current on their bills.
Still, less than half of the survey's respondents sought help with their finances. Of those who did, the majority went to their credit card or mortgage lender, according to the survey, while one-third sought assistance from a credit counseling agency. Mintel Comperemedia behavioral economist Susan Menke said such low rates of consumers seeking assistance may represent a "tremendous opportunity" for credit counseling services hoping to build their customer base.
A New Horizon is slated to host counseling and education programs aimed at improving financial literacy, which the non-profit organization defines as "an individual's ability to make informed judgments and effective decisions about the use and management of their money." Topics covered will include the responsible use of credit and debt management planning.
Consumers seeking information on how to contact a credit counseling or debt management service need not look any farther than their monthly bill. In addition to requiring a time table for paying off one's balance, the Credit Card Accountability, Responsibility and Disclosure Act of 2009 also mandates that lenders include toll-free phone numbers for such services on their statements.
Staying current on payments is one of the most important personal finance habits a consumer can employ. Late payments will appear on one's credit report for up to seven years, while bankruptcy filing can remain for as long as 10 years.