A stunning report several days ago found that more than a third of Americans who have a credit record have been turned over to collection agencies for debts and unpaid bills.

That's terrible, but perhaps not surprising considering the Great Recession, the real estate meltdown, and long-term decline in inflation-adjusted incomes for middle-class and lower-income workers.

Unfortunately, lots of people facing debt and credit problems appear to be going it alone, and that can lead to bad decisions that make things worse.

According to the National Foundation for Credit Counseling, only about 1.5 million of the roughly 75 million people dealing with collection agencies sought free or low-cost counseling last year from agencies affiliated with the NFCC.

The organization serves a national network of nonprofit financial counseling agencies, and the federal government recommends that people seek out counselors certified by the NFCC. There are also plenty of for-profit companies, some of which prey upon people in desperate situations, extracting big fees based on false promises.

Those who seek out help need to be careful of their choices, of course. The NFCC's toll-free number is 800-388-2227.

Those who are trying to dig out of a financial hole on their own need to be careful that they don't make things worse.

For example, people in debt might be tempted to cut up the credit cards, not realizing that doing so can hurt their credit score.

A bad credit score can keep people from getting reasonable interest rates on loans. Credit scores are also used by landlords to screen tenants, and some employers consider credit scores when making hiring decisions, so it would be tragic to lower one's credit score in a misguided attempt to be financially responsible.

There are lots of factors that go into credit score calculations. Paying debts on time is a big one, of course.

Also, it helps your credit score to have a long credit history, and to be using a relatively small percentage of your available credit.

If you cancel a credit card that you've had for years, you may shorten your credit history, and that's a negative.

More importantly, when you cancel a credit card, you have less credit available. So, if you have outstanding debt, but less credit, that means you're using a larger percentage of your available credit, and that's going to ding your credit score.

I'm not suggesting that you should never cancel a credit card. I probably cancel a credit card about once a year. But it's important to think about how canceling a card will impact your total available credit, and how long you have had different accounts open.

The reason why I cancel a credit card roughly once a year is, I tend to sign up for credit cards that offer large incentives to new customers, and then after a year when an annual fee pops up, I cancel them. To avoid harming my credit score, I won't cancel the credit card account that I've had open for the longest time, and I keep the no-fee credit card with the largest spending limit, even though I rarely use it.

If I were to cancel that card I rarely use, I would be using a larger percentage of my available credit. And that could hurt my credit score, because they look at "credit utilization" even if you pay off all the balances in full each month to avoid interest charges.

If you have a credit card that carries an annual fee, and you want to cancel it because of that fee, another option - which the customer service people will likely pitch when you call to cancel - is a different credit card offered by the same company that has no annual fee.

If you want to keep the account but don't want to pay a fee, that's not a bad option.

Having a credit card and using a credit card are two different things, so consider the potential impacts before deciding to cancel your credit cards.