I am a 27 year old grocery store employee. I grew up in poverty and insecurity and was once an emotionally sloppy person. However, with the help of therapy and ADHD treatment, I am now a very stable person. However, one thing that has followed me from my previous lifestyle is old debt and a terrible credit score. .
I definitely live within my means, but I have no extra income. I’m in a serious relationship with a guy who makes a lot of money and owns his own house, so there’s pressure to turn my finances around.
He knows I have made big changes in my life and is very supportive, but I have never told him about my debt. I would like to process the debt of I asked American Consumer Credit Counseling for help, but I’m not sure if that’s the best way to go.
I know there are options, but I can’t pinpoint the best next step. can you help?
Prepare for change
dear lady,
you are running your own race. It is doable to have a medium to long-term goal of paying off debts regularly, automating those payments, and getting back on track. , just get in the way.
of National Foundation for Credit Counseling is a non-profit financial counseling organization that helps you develop a budget and realistic plan to pay off your debt. As you indicated, American Consumer Credit Counseling Another non-profit organization out there for people in your position.
No shame in your game. We should be proud of how we have come this far, both personally and financially. You probably don’t realize how much courage, fortitude and stamina it took to get to where you are now. According to research Emotionally unstable families can be one of the greatest challenges to childhood development and later life stability.
But you have already won. You have a partner who is like a best friend. a stable job; and the will and ability to repay this debt. It may take years, but getting help and knowing that you’re better off not trying to do this on your own will give you greater peace of mind. .
I have no doubt that he will not react negatively like you would expect. he knows you he knows your heart And he knows how hard you’ve been working. He will probably want to give you moral support and cheer you on in your efforts. His credit card balance hit a record $931 billion in the fourth quarter of last year, an increase of 18.5% for him on an annual basis.
And while we can compare ourselves to others and feel we haven’t achieved enough or haven’t done enough, there will always be someone who has benefited more than you. This man wrote to me about a $100,000 gambling debt, but hasn’t told his wife yet. He’s trying to come to terms with addiction while you readjust your financial life.
support group
There are several ways you can take to pay off your debt. The “debt avalanche method” starts with the debt with the highest interest rate (such as a credit card), while the “snowball method” starts by paying off the debt with the lowest balance as soon as possible. If you have multiple debts, we recommend starting with the highest interest rate. Please check this out for details.
There is also a support group containing Debtor Anonymousyou can have a safe space to talk about your background and emotional life, take responsibility for your debts, and plan how to move forward with the help of a community that is in the same boat as you. You’ll also find sponsors and mentors to hold you accountable and guide you along the way.
As you progress, you can also consider building your credit score. If you have paid off your debt, you can negotiate a write-off, for example. This is a “bad debt” on your credit score when you don’t pay the minimum payment on your debt in full for several months, and it is excluded from your debt. your credit report. To do so, you must contact your creditors directly.
You can also consider joining a credit union. Many credit unions have financial literacy programs and can offer advice on debt consolidation and management. See here for details. However, be careful with commercial debt management services. Not only does this charge unaffordable fees, but it can also push loans with a higher annual rate (APR).
After moving forward with a plan to pay off your debt, you can focus on taking evening classes, moving up the ladder at your current job, or spending extra time working less. . Wasteful expense for debt consolidation. It’s not painless, but the sense of accomplishment is worth it.
You have restored the dignity into your life that you should always have. Your future is already here. Please keep in touch and let us know how you are getting along. The countless readers of this column are also wishing you luck.
Yoyou Email The Moneyist with your financial and ethical questions at qfottrell@marketwatch.com and follow Quentin Fottrell. twitter.
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More by Quentin Fottrell:
“She’s a Naughty Girl”: My father set up a $500,000 trust for his troubled sister and asked me to be its trustee. What are the risks of being a fiduciary?
“We live in Purgatory”: Wife has a trust fund, but mother-in-law controls it. We are making $400,000 and spending beyond our means. what’s our next move?
I’m Afraid To Tell My Spouse’: I have run out of credit cards and am $100,000 in debt due to my gambling addiction.
