Quick Answer: A 71-year-old retiree with $10,000 credit card debt has several options including contacting nonprofit law firm HELPS, consulting debt coach Damon Day, or considering bankruptcy depending on home equity. The recommended approach is getting a custom debt solution rather than struggling with payments that exceed Social Security income.
Question:
Dear Steve,
I am 71 years old and not able to work much longer.
I have credit card debt of almost $10,000, and I will have to quit working in November. I own my home and have no other bills, so I can survive on Social Security but not if I pay all my credit card debt. So what is the best solution? If I don’t pay, what can they do?
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Carolyn
Answer:
Dear Carolyn,
Welcome to retirement.
You have some options. Every provider believes they have the best solution. Your choices range from:
- Contact the nonprofit law firm HELPS for low-cost creditor interference.
- Some debt reduction scam, there are many.
- Maybe bankruptcy, depending on your state and details about your house’s equity. That approach really depends on many factors. Some people appreciate legally closing the door on old debts and never having to worry about them again.
- A credit counseling Debt Management Plan, but that makes zero sense in your situation.
- Witchcraft.
- Luck.
- Hope.
- Prayer.
However, the most balanced solution would be to first talk to my Debt Coach friend Damon Day and discuss your overall situation. Damon is not going to push you to do anything. His role is to help triage your situation, give you options, and help you execute the custom plan you are most comfortable with.
Damon and I talked recently on this podcast about the steps people need to take first to deal with their debt. It is worth a listen.
Listen to the Podcast
You asked me, what can creditors do if you don’t pay. They can do the usual stuff from attempting to collect the debt, all the way up to suing you. For some people life can become very stressful from just the collection attempts.
But that anxiety is primarily caused by the lack of a plan on how you want to deal with the debt. Advice, education, and a plan bring knowledge and comfort.
Don’t worry. There are options here. It’s great to see you reaching out months early than a day late.
Know Your Rights: If a debt collector is contacting you, you have legal protections. See the complete list of FDCPA violations collectors commit most often. Use the free Debt Validation Letter Generator to demand proof of the debt, or check this collector’s complaint history with the Scam-O-Meter.
Dealing With Debt? Before you pay a collector, understand all your debt relief options — including ones the collector won’t tell you about. If the debt feels unmanageable, take the 2-minute bankruptcy quiz to see if the math favors a fresh start. Federal Reserve research shows filers recover faster than those who don’t file.
Asked question about how to deal with my debt entering retirement.
Carolyn, I just answered your question.