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  Dear
Debt Adviser,
I have screwed up my life. I acquired lots
of debt in college and have let the debt go. (About $5,000
or less.) I didn't file taxes, but I did pay into the government
and state. I graduated from college and there are no jobs.
I am teaching for $1,000 a month. I am looking for a second
job and wanting to get this mess cleared up. Do I have any
options other than bankruptcy? The calls are unbearable and
the threats are getting worse. Is it too late to pay my debts?
Please help.
-- Kathy
 Dear
Kathy,
Whoa! Easy does it!! You have only screwed up a small portion
of your life and almost everyone has done that or worse at some
point. First, the card debt is small (relatively speaking).
Second, you may not have needed to file the tax returns and
the fact that you paid something is a plus. Third, the low-paying
job isn't necessarily forever! So back it down a notch and let's
get you some help.
You mentioned bankruptcy. In your case, with
so little debt behind you and such a big future ahead, it
makes no sense. Forget about it!
Let's take care of the taxman first. You should
file tax returns for the years that you did not. Because your
income is so low, it is more likely that you may have a tax
refund or two coming your way rather than a big bill. A refund
would help tremendously about now and if for some reason you
owe additional taxes, dealing with it now rather than later
is always the best option.
Because it has been some time since you have
made any payments, your accounts have likely been turned over
to collection agencies, which is why you are receiving threatening
phone calls. Gather up current copies of your credit card
bills or get a copy of your credit report so that you will
know who and how much you owe. The collection agencies generally
try to collect the balance owed in a lump sum, and you obviously
cannot afford to do that.
Be sure you know how much you can afford to
give them. A simple
spending plan will tell you that. Then call the issuer
of the cards and try explaining your situation and ask for
a hardship plan. Unfortunately, due to the nature of the collections
industry, this may be an effort in futility on your part,
but at least you will have tried to reach a solution with
the issuer.
Your next option is to seek advice from a reputable
credit
counseling agency. A credit counselor can review your
current income and expenses plus your outstanding debts to
determine what solutions work best for you. Given that you
are willing to get a second job to increase your income, I
believe there is a good chance you and your counselor will
be able to come up with a plan to repay your debt.
Stay away from any agency that charges a large
upfront fee, spends less than 45 minutes with you in a counseling
session or pressures you in any way.
Finally, about that $1,000-a-month job. Keep
looking. I know it's not fun, but you can do a lot better
if you just keep at it. Find out about networking
and let all your friends and relatives know you are actively
searching for a "real" job!
Good luck and don't be too hard on yourself.
This is just a small bump in this great adventure we call
life!
The Debt Adviser, Steve Bucci, is the president
of Consumer Credit Counseling Service of Southern New England.
Visit CCCS
for additional debt
advice or click
here to ask a debt question.
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