This is the second video in a series we shot to help get a new perspective on money, credit, and debt problems.
I selected a series of questions sent in through the GetOutOfDebt.org site and we went out and asked some homeless people if they would be willing to participate in this project and share their opinion to help answer some reader submitted questions. We had to summarize the questions to ask them but the full questions and my answers are below.
Robert and Wilhelmina were paid $20 each for taking the time to help answer questions and Wilhelmina immediately used her funds to go buy some new shoes for work.
The questions included in Part 2 were:
- Donna – My 82 yo mother has $31K in credit card debt. She receives SS & teaches piano. She’s semi-disabled but can still drive (not for long) & lives w/a roommate in a house. Her income barely covers the most basic living expenses and she can no longer pay the debt. The debt was incurred when she moved to help her sister & couldn’t get a job while building the piano teaching biz. Most of the debt is balance transfers robbing Peter to pay Paul while she tried to make ends meet but she finally hit a wall & can’t do it any longer. She’s starting to lose students to graduation & it’s very hard to get new ones. Should she go ahead & file bankruptcy ch. 7? If so, can she negotiate with a couple of the cards like Amex & Citi to continue & pay down those small amounts or does she have to be completely credit free?
My Answer: Yes, she should meet with a local bankruptcy attorney and discharge this otherwise un-payable debt.
- David – I was laid-off 4 months ago and have been unable to get a job so far. I’m 63, no savings, no retirement. Before i was laid-off we had difficulty meeting our financial obligations. We had asked 2 of our credit cards for hardship help; they closed our accounts, lowered interest rate and payment. Now that I’m unemployed i’m receiving unemployment pay (CA) and my wife receives monthly SSI for disability. Unemployment and SSI only covers our basic bills for rent, housing expenses, medical premiums, a monthly tax payment and a term life ins policy. We have $120 left over for food, gas, meds. Not being paid are 4 credit cards (total balance ~$29000), Dental and medical bills (~$5500), $2100 borrowed from friend and family. Wife wants to declare bankruptcy; I’m ashamed to do it. I want to do Debt Management but don’t think I can because of no employment. What can I do? Other options?
My Answer: David, shame and reality are two different things. And while your “shame” about filing for bankruptcy is real and bothers you, it is a distraction from the reality of your situation. Bankruptcy is a legal solution to assist people who are otherwise in financial situations that are beyond their control. Don’t forget, just because you go bankrupt now does not mean you can’t repay your creditors in the future if that would make you feel better. In your situation you have no business entering a debt management plan.
- Jennifer – 42,000 in credit card debt due to accident in 2005 and job loss after.got a modification on the house so we are okay there. The credit card payments are getting to be too much. have transfered to get a better rate but only last for a year. what is the best way to get this payed off? Take out of retirement ?file bankruptsy?
My Answer: If the choice is between draining the retirement fund or bankruptcy, my vote is bankruptcy. In bankruptcy the retirement money will be protected for when you need it most, and you will need it latter.

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