Am I okay financially?

Do you ever wonder if you need help with money? Things are tight, sure, but they’re probably tight all over, you might be saying. Reaching out for help is easier than you might think, but knowing when to reach out can be tricky. What’s the difference between “normal” struggling and the kind of struggling that could really benefit from professional assistance?

In 2013, more than 1.5 million consumers decided that they did need help and reached out for assistance from one of the National Foundation for Credit Counseling’s member agencies. By aggregating that information, we’re able to create a picture of the typical consumer who reached out for help last year. Every situation is unique, but this may help you understand where you stand as compared to others who decided that enough was enough and made the move to bring their debt and their finances under control.

Some of the more concerning characteristics of consumers who sought financial counseling in 2013 include:

  • The number one reason given for seeking counseling was “poor money management,” eclipsing “reduced income” which had held the top spot since 2009. This would seem to indicate that an improved economy may put more money in people’s pockets, but without the knowledge to manage that money properly, finances will remain a daily struggle.
  • The age of consumers seeking assistance was evenly divided - young adults (25 to 34 years old) made up 24 percent; 35 to 44 year olds represented 23 percent; and 35 to 44 year olds accounted for 21 percent. The interpretation here is that financial problems can occur at any stage in a person’s adult life. You’re never too young or too old to benefit from professional financial assistance.
  • The average household take-home income was $35,081, with an average unsecured debt of $17,548. This means that the average consumer seeking credit counseling assistance last year had a debt-to-income ratio of nearly 50 percent. That’s way too high. Check your own debt-to-income ratio – your ratio is over 40 percent you should seriously consider reaching out to a certified debt counselor.
  • Consumers seeking help carried an average of 5.7 credit cards. That’s a lot. If you have too many open lines of credit it may begin to adversely impact your credit score, not to mention the fact that juggling that many different debt responsibilities can easily lead to missed payments and defaulted accounts. Having any more than four credit cards is a potentially dangerous red flag.

If any of this looks like you, you may benefit from professional financial advice. The worst thing you can do is wait too long and let a little problem because an enormous problem, so call today and get back on track.

Jesse Campbell is the Content Manager at MMI, focused on creating and delivering valuable educational materials that help families through everyday and extraordinary financial challenges.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.