How Much to Expect to Pay For Debt Management

You’re interested in enrolling in a debt management plan (DMP) to help you get a handle on growing financial obligations. However, because of your situation, you don’t have a lot of cash to spend on a solution. You can ease your worries however, some nonprofit debt management providers charge a service fee, and others don’t. It largely comes down to the state in which you reside.

With that in mind, here’s how much to expect to pay for debt management.

What is a Debt Management Plan?

These plans provide a way to erase credit card and other high-interest unsecured debt without a personal loan. Offered through credit counseling agencies, DMPs usually lower your interest rates and monthly payments. They also simplify the payment process for those who have several cards with differing payments and due dates.

How Do DMPs Work?

An accredited financial counselor will go over your situation to help you establish a budget that includes an affordable fixed monthly payment. Your credit card issuers must sign off on the plan and might make changes before doing so.

Rather than pay your creditors directly, you’ll make monthly payments to the counseling agency, which allocates the funds to your creditors according to the agreed-upon schedule.

How Much are DMPs?

Debt management fees are governed by your state of residence.

Some agencies charge a nominal one-time fee of around $75 to set up a plan. Other agencies require monthly fees of between $25 and $50 until the program is completed, and sometimes fees are waived.

As mentioned up top, not all DMPs require fees though.  If you want to avoid paying them, look for an agency that doesn’t charge them. They’re out there.

What is a Credit Counseling Agency’s Role?

In addition to working with your creditors to get your payments and rates reduced, the counselor serves as the liaison between your creditors and you.

The agency also provides educational tools that help you get to the root causes of your debt.  Your counselor will also help you understand the importance of budgeting and why you should avoid debt in the first place. Each month, the counselor will also provide status reports that include the latest amounts paid and the remaining balances.

The best agencies will also make your counselor available for inquiries during the program and provide you with updated educational tools once the program is completed.

Is a DMP for Me?

Let’s look at the top debt management program pros and cons:


  • It streamlines bill paying since you have just one to worry about each month.
  • It can realistically get you out of debt in three to five years.
  • It consolidates your debts without a loan.
  • It can, over time, improve your credit scores.
  • Creditor or collector calls will cease.
  • It saves you from late fees.


  • You must make the agreed-upon payment monthly, or risk getting booted from the program.
  • You’ll be asked to close your credit card(s) to avoid incurring more debt, and you can’t open any new cards or other lines of credit such as an auto loan.
  • If some of your creditors don’t agree to go along with the plan, you’ll have to pay them separately.

When is a DMP Not for Me?

You might be able to handle your debt load by yourself just by budgeting better if it is small. On the other hand, if the amount you owe is so large that you can’t handle the required payments in addition to your everyday needs, you may need the help of a debt relief company.

Beyond determining how much you can expect to pay for debt management, your first charge is to be certain that your situation calls for a DMP—or a solution such as debt settlement.

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