The debt settlement company will direct you to stop paying your creditor and instead send the money directly to them each month. The company's goal is to demonstrate to your creditor that you don't have the money to pay up - that's your leverage. After a few months, the company will typically go to the creditor and say, "I'm holding X dollars on behalf of your customer. He doesn't have the money to pay you, so you should take this amount as a settlement or you'll end up with nothing." If the creditor wants to get paid badly enough, it will take the money.

If you have even a smidgen of doubt that you'll be able to stay away from racking up additional debt, don't do it.

One thing I want to make clear: You never want to hide from your debts. It doesn't work.

You can have a do-over starting today. But you have to get over the feeling that it's too late

Pay cash. For some reason, it's harder for people psychologically to part with their cash than it is to swipe a card. Maybe it's the act of physically seeing the money change hands, or maybe it's because you don't want to break a $20 for a $2 cup of coffee.

You really don't need to hire a debt settlement company to negotiate with your creditors.

You must be sure - and I mean absolutely positive - that you have the willpower to pay off those credit cards and not use them again.