What is the role of a credit counselor?

The role of a credit counselor is primarily to provide low-cost financial advice and create customized debt management plans for individuals. Credit counselors work with clients to assess their financial situation, identify debt challenges, and develop strategies to manage their debts effectively. This may include negotiating with creditors on behalf of the individual, creating budgets, and offering education on financial management practices.

The focus of credit counseling is on helping individuals who are struggling with debt to regain control of their finances. This assistance usually comes at a lower cost compared to other financial advisory services, making it accessible for many people in need. By creating a structured debt management plan, credit counselors help ensure that clients can pay off their debts sustainably over time.

Other options reference roles that are not aligned with the core functions of a credit counselor. For instance, filing bankruptcy is generally a last resort and is often done in consultation with a legal professional rather than a credit counselor alone. Investing clients' money in stocks and bonds is more characteristic of a financial advisor rather than a credit counselor. Lastly, while recovering debts for creditors could involve collection agencies or legal mechanisms, it is not a function of credit counseling, which primarily works in the interest of helping individuals rather than recovering money for creditors.