(Editor’s note: Jane McNamara, GreenPath president and CEO authors a credit advice column “Let’s Talk Credit” with www.creditcards.com, answering weekly questions on credit and debt. This week she talks about credit card settlement.)

Dear Jane,

I have about $30,000 in credit card debt. I was fortunate enough to get a loan from my uncle to pay my debt off. My question: I’m not delinquent with any of the cards, so would it be wise to try and negotiate a pay-off amount with the credit card companies?

One of the credit card companies was willing to take off a couple hundred dollars without considering it as a settlement. But, I have two other credit card companies that say if I were to negotiate a pay off amount less than what I owe, it would be considered a settlement, which could potentially affect my credit.

Is it really worth trying to settle my account to save about $600 (I was told that if it was under $600, it would not be reported to the IRS)? While I do want to pay off my debt, I want to see if I can save some money. Please advise. — Kaykeo

Dear Kaykeo -  Saving money can be a motivator to us all. However, based on your scenario, I don’t believe it would be worth the damage to your credit.

A settled account could drop your FICO credit score anywhere from 45 to 125 points, depending on your score before the settlement. Your credit score is evaluated by many different people including landlords, employers, insurance companies and creditors. Therefore, I don’t recommend purposefully taking an action that would cause damage to your credit score.

Another thing to consider is that many card issuers will not consider settling an account, if it is in good standing.

A better idea would be to thank your uncle for his generosity and pay off your substantial credit card debt in full. Then, you should develop a plan to pay back your uncle. Consider putting the loan agreement in writing and set a monthly payment amount, along with a monthly amount to put into savings for emergencies.

To help with developing your spending plan, track your expenses and decide where you might be able to cut back and also explore ways you might increase your income. You may be surprised to learn that you are spending a great deal each month on items that could easily be reduced or eliminated.

Finally, check with your employer’s human resources department and determine if you are withholding the proper amount from your pay check each pay period. If you are receiving a tax refund of more than a couple of hundred dollars, you could increase your withholding and bring home more money each month. Good luck!