The great people over at the New Road Map Foundation are conducting a survey to uncover how people are getting out of debt. They’ve asked me to share the following announcement with you, which I am honored to do.
The New Road Map Foundation is probably something you are not familiar with, but should be. Their goal is to help awaken all people about the calculation we all need to process to make educated decisions about what is more important to us, our money or our lives. It’s actually the name of the book the formation of the foundation began with. See Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence. I have to admit it’s a book that fundamentally changed my life.
Here at New Road Map Foundation, we have sometimes struggled with the question of how to help those that come to us in debt. Our Financial Integrity program has helped many folks to bring their spending in alignment with their values, and helped folks to retire early so they can spend their time living those values. But the program does not suit everyone that comes to it. Some who are in debt ask for more help specifically getting out of debt before they implement the steps of the program.
We went in search of information to help these folks. What methods work? Was there a proven method to reduce debt? What we found surprised us. To date there has been no peer-reviewed study evaluating the appropriateness of different kinds of financial education to clients in debt and seeking help. In other words, no one had asked and studied our question!
We did find some information, of course. We found studies classifying the types of people in debt. These studies talked about how people in debt act, but not how they might get out of debt. We also found studies of the effects of counseling on spending, but they focused on how education and counseling affected saving behaviors, not how education and counseling might teach people to retire their debt. Finally, we found studies that predicted the behavior of those in debt based on psychological or demographic characteristics. These studies didn’t extend to looking at efforts to reduce debt, however.
This left us to our own devices. We looked at some existing debt reduction programs to see if they might be able to tell us, in their own words, who might best choose which program. Our program does work well for some folks in debt. Rose charts her progress in reducing debt and finds the process and chart inspiring. Fred used the program to successfully pay off over $10,000 worth of credit card debt. Dave Ramsey’s program works well for others. The focus on one “baby step” at a time seems to help some people stay on track. And a different group benefits from the structure provided by the non-profit Consumer Credit Counseling Services, who put clients in a consolidated monthly payment program.
All this was informative, but didn’t really answer our question. How do we know which program would work for the distressed debtors asking us for help? We had to conclude: The only way we can learn what works is to ask people who have successfully gotten out of debt what worked for them. So we’re doing our own study.
As the first step in this research we are conducting a short confidential survey to find folks willing to be interviewed about their past debt and how they paid it off. We need your help! We need to hear from people in every kind of financial situation, whether in debt, out of debt, or never had debt. This research project has been approved by Colorado University’s Institutional Review Board and is now underway. The results will be published on our website and will be used to create educational materials to help the general public assess which debt-relief method may work best for their particular circumstances.
Your information will help us help people in desperate financial straits. Thank you!
The New Road Map Foundation (NRM) mission is to promote personal financial integrity through education and support. Our Financial Integrity Program and other tools are all available free of charge on our website. More information about NRM is available here.