When an individual is faced with a financial crisis you can be rest assured there are helpful alternatives to resolving financial matters.In my opinion the most popular choices available are a DMP or an IVA.Along with all choices they have pros and cons.An IVA is an Individual Voluntary Arrangement also known as a formal insolvency.The IVA program is legally binding and is an arrangement where the individual agrees to repay creditors according to the individual's ability to pay.The process usually lasts 5 years and one must have accumulated debt of at least 15,000.00.IVA Advantages.The advantages to selecting an IVA are..1) The arrangement is legally binding and the creditors must abide by the IVA arrangement, as long as you have over 75% of the total debt value agreed by the creditors.2) You should be able to keep your home although in some circumstances you may need to remortgage after 5 years 3) Creditors are not allowed to call the home or job looking for the debtor.4) Credit interests and charges are frozen.IVA Disadvantages.The disadvantages for an IVA are..1) The credit score is affected for up to 72 months after completion and may hinder in securing future credit during the time of the IVA.2) An individual will have to live on a strict budget, as your disposable income is taken to pay off the debts.3) In some cases selling the home may be necessary.Debt Management Plan or a DMP is informal arrangement where contact is made with creditors on the individuals' behalf and mediates between the individual and creditors for a monthly payment plan.Debt Management Plan Advantages are..1) The service is not a legally binding service and one can opt out of the program.2) The creditors agree along with the debtor on a monthly payment plan.3) Your debts are reduced over time.Debt Management Plan Disadvantages are..1) The creditors may continue to raise the interest's rates.2) The credit score will be affected.3) The creditors may opt out of the program.

Consumer debt is a global epidemic that seems to get worse over time if not addressed.The slow accumulation of many different credit cards, and loans pile on to form a monumental debt balance with payments that often become too much for even the above average consumer.Debt is not something to be ashamed of though, as the style of living in the 21st century really requires consumers to stay on top of the latest trends.Even the necessities of life can become too much to manage.Before you know it, you are buried in a pile of high interest debt, with seemingly no way out.Fortunately, there are many financial institutions and advisors that make an effort to conduct consultations with consumers to attempt to lower, and in some cases eliminate much of their debt.Granted there are many steps that can be taken before you need a third party to assist you.One such step is to stop yourself from using credit cards as a means to pay for necessities of life.Why would you risk paying high interest rates on petrol for your car if you have the money in a bank account? The same reasoning can be applied to groceries, clothing and paying utility bills.If you are able to manage your finances in a way that allows you to eliminate your use of credit cards, making it possible to pay them down, then you really need to do this.For many this can be as simple as avoiding trips to the malls, or large shopping centre, where temptation can get to you.Paying down debt, and not just paying minimum payments, should be you're first and foremost goal when you realise you have a problem.When you are to the point that your debt payments and your cost of living exceed your income, as is very common, then you will likely need the help of a financial institution that focuses on assisting consumers.These advisors will be able to offer you any number of DMP, or debt management plans, to help guide you out of the debt you are in.This can be an excellent way to get a fresh start to your financial life.If you are so far in debt that you need to consider Bankruptcy, don't let it bother you, bankruptcy is a good way to get a clean slate as well.