Retired From the Navy and Now Can’t Sleep Because of Our Debt. – Elio

“Dear Steve,

I am so glad to have come across your website. I am presently in a situation for which I need help. I have recently retired from the Navy. Unfortunately my income has dropped by approximately 70% and my expenditures have increased, i.e. monthly co payment/deductibles for Health/Dental insurance. I thought I could manage all my obligations as soon as I would secure a job, but after 5 months of searching and applying I am still unemployed.

Here is my situation; I am over 50 years old and according to you I should not be in this position where I am without retirement savings. My wife and I have a combined debt of approximately $45,000 plus $2000 mortgage, car payment of $400 and a student loan, which I was told could not be included in any debt relief/bankruptcy program. My present income is $3000 retirement and my wife’s $1600 monthly income. Needless to say that the three of, including my son, are in deep trouble. Please help us do the right thing.

1. Would bankruptcy be the best choice for us?
2. Is there a way to include my student loan in a bankruptcy filing?
3. would my insurance company (house/car) drop me if I file for bankruptcy?

Please respond fast…we are loosing sleep. Thank you


Dear Elio,

Thanks for serving in the Navy. You rock.

Welcome to the outside world. Sometimes it really sucks.

I’m not sure if bankruptcy is the right choice for you and neither are you at this point. The reality is that it just might be the best solution for you.

But before we get ahead of ourselves there is some homework I’m going to assign you and then I want you to come back and update me in the comments below about what you learn from your homework below.

I’d suggest you first read How to Get Out of Debt. The Honest and Unvarnished Truth and The Truth About The Success Rates, Failure Rates and Completion Rates of Credit Counseling, Debt Settlement, and Bankruptcy. They will give you a great overview of what we need to deal with to get you moving in the right direction.

See also  National Foundation for Credit Counseling®, American Library Association Join Forces to Better Serve Military and their Families

Then use the free How to Get Out of Debt Calculator to review your options.

Once you’ve identified a company you want to work with, then follow my step-by-step guide on what you should look for and expect from a good debt relief company.

1. Would bankruptcy be the best choice for us?

Might just be.

2. Is there a way to include my student loan in a bankruptcy filing?

It can be done. See How to Really Discharge Your Student Loans in Bankruptcy. Many Can. But Never Try.

3. Would my insurance company (house/car) drop me if I file for bankruptcy?

No, but your rates might go up because your credit score drops in the short term. But it’s going to drop anyway if you don’t take action.

It’s time to address the debt, put the financial stress behind you and focus your energies on finding employment.

Please post your responses and follow-up messages to me on this in the comments section below.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.
Damon Day - Pro Debt Coach

Steve Rhode

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