Common Reasons People Avoid Credit Counseling Services

Good credit is one of those things you feel you don’t need – until you need it. Something breaks, or you find yourself in a jam and need to get out of it. No one can predict this, unfortunately. So, it is important to build a good credit profile for when you need it. And if you have bad credit, you might avoid credit counseling for a variety of reasons.

Having good credit can unlock more financial opportunities and possibilities for you, including savings on interest rates, better loan and credit card terms, and the ability to buy things on credit like a house, a car, boat, or even a vacation.

What is Credit Counseling?

Credit counseling is a service provided by organizations or agencies that aim to help you manage your debt and improve your overall financial situation. Typically, credit counseling involves these core ideas or services.

Complete Financial Assessment

Credit counselors typically start by conducting a thorough review of your financial situation. This includes assessing your income, expenses, debts, assets, and credit report. It’s important to be honest – the credit counselor is not there to judge. They are there to help.

Helping with Budgeting

Credit counselors work with you to create a realistic budget that accounts for your income and expenses. They may provide guidance on reducing expenses, increasing income, and prioritizing debt payments. They may also provide a dose of realism to your plans as it pertains to future expenses and planned use of credit.

Debt Management

If you are struggling with unsecured debts (such as credit card debt), credit counselors may recommend a debt management plan. This involves negotiating with creditors to lower interest rates and consolidate multiple debts into a single monthly payment. You make payments to the credit counseling agency, which then distributes the funds to creditors according to the agreed-upon plan.

Sometimes, the counselors may act as a mediator between the creditors and you, though this might fall to you. At the very least the counselor will be able to provide negotiation tips for you.


Credit counselors often provide financial education and resources to help you improve your money management skills. This may include topics such as budgeting, saving, understanding credit scores, and avoiding debt in the future. A good credit counselor will act as your financial coach and educate you about your finances.

Credit Score

Credit counselors can offer advice on how to improve credit scores and maintain good credit habits. They may help you understand the factors that affect your credit score and provide strategies for building positive credit history.


Bankruptcy certainly has a stigma associated with it, and credit counselors are well versed. Individuals considering bankruptcy may be required to undergo credit counseling as part of the process. Credit counseling agencies can provide the required counseling and help you explore alternatives to bankruptcy if appropriate.

Housing Problems

Some credit counseling agencies offer housing counseling services, including assistance with foreclosure prevention, rental housing issues, and homebuyer education. If you are in need of this, its best to do some research and find the agencies that offer this service specifically.

Reasons Why You Might Avoid Credit Counseling Services (AKA Excuses)

Now that we’ve seen what credit counselors and credit counseling services do, let’s look at some of the reasons why people might avoid credit counseling services.

  1. Stigma: There is still a stigma associated with seeking help for financial problems. You may feel embarrassed or ashamed about their financial situation and may be reluctant to seek assistance.

    As we’ve stated above, credit counselors aren’t there to judge. They are there to help. Still stigma can be powerful especially amongst those you love. Don’t be afraid to be judged by family and friends. This is a personal decision. No one will unfriend you or kick you out of the family for getting help with your finances.
  2. Fear of Judgment: You may worry about being judged by others or by the credit counselor for your financial choices or mistakes. This fear of judgment can prevent people from seeking help.

    There is no judgement from credit counselors – that is why they are there in the first place. If no one had credit problems, they wouldn’t have a job.
  3. Lack of Awareness: You may not be aware that credit counseling services exist or may not understand how you can benefit from them. You may mistakenly believe that you can handle their financial problems on their own.

    And while this is true, you might be able to handle it on your own, the truth is a counselor might have tools at their disposal as well as the knowledge of working with many clients and creditors to work out a better outcome for you.
  4. Perceived Cost: While many credit counseling services are free or low-cost, you may mistakenly believe that they are expensive and therefore avoid seeking help or avoid credit counseling altogether.
  5. Misconceptions: There are misconceptions about what credit counseling entails. You may believe that it involves giving up control of your finances or declaring bankruptcy.

    This is not true – no one is going to hold you accountable but yourself. They can help you plan but in the end you are in control.
  6. Preference for DIY Solutions: You may prefer to try to solve your financial problems on your own rather than seeking outside assistance. You may believe that they can research and implement strategies without the help of a credit counselor.

    While there are certainly some things you can do and try on your own, the credit counselor does have experience in dealing situations that are far worse than your own. So they can help you come up with a solution you are happy with and keeps you in control.
  7. Trust Concerns: Trust is essential in any financial relationship, and you may be hesitant to trust a credit counseling agency with your personal and financial information.

    While this is founded, credit counselors are typically accredited and in the event that trust is broken their accreditation can be revoked which is bad for their business and reputation.
  8. Fear of Scams: Unfortunately, there are scams in the financial industry, and you may worry about falling victim to a scam if you seek credit counseling services.

    If you do your due diligence, you can find credit counseling services that are reputable. The golden rule applies, if something seems too good to be true it probably is. Get a second opinion when in doubt.
  9. Lack of Time: You may perceive credit counseling as time-consuming and may feel that you don’t have the time to dedicate to the process.

    Many counselors have flexible hours and can work around schedules to meet your needs. They understand their clientele might work odd hours or multiple jobs to make ends meet.
  10. Hopelessness: In some cases, you may feel so overwhelmed by your financial situation that they become paralyzed and avoid seeking help altogether and thus avoid credit counseling.

    Your financial health is important as it may also affect your own health and well-being. Seeking out credit counseling, and not avoiding it, can only serve to benefit your situation.

Don’t Avoid Credit Counseling If You Need It

Credit counseling aims to empower you to take control of your finances, reduce debt, and achieve financial stability. It’s important to choose a reputable credit counseling agency that is accredited by organizations like the National Foundation for Credit Counseling (NFCC) or the Financial Counseling Association of America (FCAA). This will help cut down on stigma and scams that might be out there.

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