Yesterday, I sat down with a client who explained how she had tried to do the “right thing” by signing up with a debt consolidation service. I had not heard of the company to which she had been paying $419 monthly for the past year, so I did a Google search on them. Attorney Generals for Maine, California, and New York have all filed cease and desist actions against the “service.” Her credit card balances are now much higher and were never paid down. The bottom line is that the client, in trying to do the right thing, wasted $5,000 which could have provided better food, shelter, and education for her two children.
Do you think she did the “right thing” by giving her family’s money to this criminal outfit?
Last week, I sat down with a client who said he had tried to do the “right thing” by borrowing against his 401(k) loan in order to pay his minimum credit card payments. He had never been late with a payment, and was willing to do anything in order to keep that perfect record. Of course, when we file his bankruptcy petition, his 401(k) loan will not be discharged. Instead of a fresh start, he will begin life after bankruptcy with a reduced paycheck until that 401(k) loan is paid back. Again, his family needs his full paycheck, so in my opinion, he did not do the “right thing.”
If either of these situations sounds familiar to you, now is the time to learn about your other options. Clients in financial distress are faced with important decisions, and often feel terrible about their situation. Guilt can cloud your judgment. This is one of the reasons you should ask for professional advice as soon as possible. Armed with good information, many pitfalls you have encountered through honest mistakes can be avoided or minimized.
For those of you in Western North Carolina, I would be happy to speak with you during a free, initial consultation.