Are you looking to design a debt management program? Perhaps one of your goals is to avoid the debt collection process.

　　A debt management program that accomplishes your money objectives may involve some combination of financial planning, debt restructuring, and getting hardship assistance. You can also consider the extreme option for avoiding debt collection: declaring bankruptcy.

　　Here are six strategies that you may want to include in your customized debt management program.

　　1. Make and stick to a budgetThe core component of any debt management plan is your budget. Everyone needs a budget, but that’s especially true if your goal is to avoid debt collectors and negative effects on your credit score. You may choose to follow the 50-30-20 budgeting rule, which allocates 20% of your financial resources to paying down debt.

　　A budget can create a road map for paying down all of your debts in a predictable way. Staying on budget is the hard part. It requires financial discipline and careful management of your expenses.

　　Identify and quantify your financial resources Consistently prioritize debt repaymentGet insight into your spending habits Avoid taking on more debtTrack your debt management progress Budgeting may feel like a chore—and it is!—but it’s far preferable to enduring the debt collection process.

　　2. Consider consolidating your debtLoan consolidation isn’t the right choice for everyone, but it can be a valuable tool for restructuring debt. If you have multiple federal student loans, for example, you can consider consolidating them into a single monthly payment. If you owe money to multiple private creditors, you may be able to consolidate your debts with a single lender.

　　Consolidation may lower your required monthly payments.It may lower your interest rate.It can simplify your debt obligations into fewer payments.Those are the direct benefits. The indirect benefits of debt consolidation may include improved cash flow and less stress about the possibility of debt collection.

　　3. Use balance transfer offersAnother debt management strategy involves balance transfer options. Usually this means transferring the balance on a high-interest credit card to a different card with a lower interest rate.

　　Transferring all your debt to the creditor that provides the most favorable repayment terms is a lot like loan consolidation, and it provides many of the same benefits. After your balance transfers are complete, you become responsible for only one recurring payment with one interest rate. Plus, your repayment timeline becomes clearer.

　　Note that if you’re benefiting from an introductory offer with a low interest rate, you’ll want to be sure and put the date on your calendar for when the introductory rate expires and reverts to a regular (i.e., much higher) interest rate.

　　4. Contact creditors about hardship programsMany creditors sponsor hardship programs, which can be especially helpful for your debt management program. You may be stressing about repayment terms and conditions, but financial institutions can be surprisingly flexible—especially if you’re experiencing hardship.

　　Job lossDivorceA death in the familyIllnessDisabilityNatural disasters Hardship programs can vary as much as lender types. There are different forms of support offered by federal lenders, private lenders, mortgage providers, auto loan providers, utility companies, and insurance companies.

　　If you qualify for a hardship program, you may be able to reduce or temporarily eliminate repayment requirements. These programs are there to help you to regain your financial strength.

　　5. Consider declaring bankruptcyThe nuclear option for managing your debt and avoiding debt collection is declaring bankruptcy. The decision to declare bankruptcy should not be treated casually, but under some circumstances, it can be the best choice to help you restructure or discharge certain types of debt.

　　Filing for bankruptcy immediately halts all collection actions against you, including lawsuits, wage garnishments, and even harassing phone calls (which are technically illegal, but they happen anyway).A bankruptcy filing affords specific protections under federal law that can shield you from asset seizure and other adverse consequences of debt collection.Court oversight of debt repayment after bankruptcy ensures fairness and deters creditors from pursuing aggressive collection actions.Bankruptcy should always be treated as a last resort for debt management—but it’s worth exploring how the process works.

　　6. Use credit counseling servicesAre you feeling intimidated by the prospect of managing your debt? A credit counselor can be an invaluable resource if you’re designing a debt management program with specific goals. Credit counseling agencies provide a range of services related to managing debt and avoiding collections.

　　Expert guidance from trained professionals who specialize in debt management Help with creating a realistic budget that prioritizes debt repayment Help with identifying efficient debt repayment strategies Support for negotiating with creditors—including negotiations conducted on your behalf Enrollment in debt management plans with structured repayment options Education on debt management and other personal finance topicsThe bottom lineOwing money to a financial institution or debt collection agency can be highly stressful, and no one enjoys the debt collection process. That’s why developing—and sticking with—a debt management program is a smart move to improve your financial well-being and avoid debt collectors.

　　Just make sure that your debt management plan is realistic and enables you to achieve your most important financial objectives.