My Husband Was Laid Off and I Was Referred to Money Management International For Help But I’m Leery. – Ann

“Dear Steve,

My Husband was laid off about a month ago and the only income in the house now is about $250 a week unemployment. I am about $25,000 in credit card debt and was referred to Money Management International. I’m leary!! What should we do?


Dear Ann,

I think the issue you need to be leery about is not Money Management International but that the suggestion that a sustained debt management or credit counseling payment program is a reasonable solution at this time.

Here is what I worry about. A credit counseling debt management plan is a commitment over a five or so year period to repay your debt in full with monthly payments. With the loss of income and the only source of current income being unemployment I think it is unreasonable to assume that you will be able to sustain that repayment plan to completion.

I suspect that you have little, if any, money in savings and I know that all it will take is one unexpected emergency to scuttle your debt repayment efforts.

The more logical approach would be, if you have no savings to cover your bills while he looks for work, to stop paying the credit card bills now and start saving the money for bankruptcy. Set a line in the sand of say 60 to 90 days for him to find a new job. If he has not found one by that point then go bankrupt.

Just know that this approach will result in collections calls and negative marks being placed on your credit report. But it is a prudent last effort to see if your situation can be saved with employment rather than bankruptcy.

Please update me on your progress by

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.

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

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