Credit Card News: Your Money

Selected cards: 0
Compare
Advertising Disclosure
Survey Shows People in Financial Trouble Don’t Reach Out for Help
4 Sep
Although some 35% of Americans have debts that have been sent to collections—an estimated 77 million people—the majority of them aren’t seeking help with their financial situations.

A study from the Urban Institute revealed the troubling statistic, but the National Foundation for Credit Counseling (NFCC) says that only 1.5 million of those 77 million people contacted them for help last year.

To find out why, the NFCC conducted a survey asking folks why they were reluctant to reach out for financial counseling. The 2014 NFCC Financial Literacy Survey revealed the following reasons, all of which are actually myths:

  • Getting help costs too much. Many people think that getting debt counseling or financial advice will be costly. In fact, counseling with the NFCC and similar nonprofits is free or low-cost.

  • Getting help is embarrassing. Reluctance to ask for financial help often stems from feelings of shame or embarrassment. People said they were afraid to reach out for this reason, but the truth is, financial counselors have seen and heard it all. There is no reason to be embarrassed to seek financial help.

  • Getting advice, not real assistance, is the only point of financial counseling. On the contrary, financial counselors don’t just give advice. They can help people set up plans to pay down debt, contact creditors, and help them enroll in debt management programs. This can help with late fees, high interest, and other problems associated with having debts in collections.

  • Getting help will negatively affect credit scores. People were afraid that seeking financial counseling would impact their credit report and keep them from getting credit in the future. However, financial counseling does not impact your credit score. If you enroll in a debt management program, this may be noted on your credit report, but it usually does not have much negative impact on the overall credit score—especially if the person is paying off their debt due to the program.

  • Bankruptcy or debt settlement seem like the only answers. Debt settlement and bankruptcy may seem like easy solutions, but they will have a huge impact on your credit report for years to come. This can mean not being able to buy a house or a car, get a business loan, even rent an apartment or get a job. Before going to such drastic measures, all attempts should be made to pay off debt in another way. Financial counseling can help.


The NFCC encourages people with heavy debt loads to contact them or another nonprofit consumer credit agency for help with their finances, and not believe these myths.

Read Also Related News

  • 20 Jul

    A new report has good news and bad news about savings in America. The good news is that the percentage of people without an emergency savings fund is at a six-year low, down to 24% from 28% last year. The bad news is that nearly a quarter...

  • 28 Feb

    It’s an oft-quoted statistic that about half of all marriages end in divorce. But less talked about is the reason why many of these marriages fail. A new survey by credit bureau Experian sheds some light on the subject and reveals that...

  • 7 Dec

    Despite highly-publicized hacks that left people’s credit card information vulnerable to criminal use and fraudulent purchases, people still find credit cards to be the safest way to pay for purchases, online or off. Payment services...

looking for a Credit CARD:
Credit One Bank®: Credit One Bank® Platinum Credit Card with Rewards
Apply Online
Receive 1% cash back on eligible purchases, terms apply
Mid America Bank & Trust Company: Milestone® Mastercard® with Free Choice of Card Image
Apply Online
Applying is quick and easy with our fast decision process
Horizon Card Services: Horizon Gold Credit Card
Apply Online
Guaranteed $500 Unsecured Credit Limit
Credit One Bank®: Credit One Bank® Platinum Visa®
Apply Online
See if you Pre-Qualify without harming your credit score
Want to Read News From Other Categories?
Your Money
Card Issuers
Travel
Security
Shopping
Technology
  • 24 Oct

    Many people may be familiar with the name Frank Abagnale. Played by Leonardo DiCaprio in the 2002 movie Catch Me If You Can, Abagnale has worked with the FBI for over four decades and advised hundreds of corporations and government agencies about fraud...

Customer Questions

  • About Us
  • Contact Us
  • Privacy Policy
  • Terms of Use
  • 0 Selected Cards Compare