Why Debt Management Is Better with Neile Simon

Aug 13, 2024

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If you’re drowning in debt and someone offers a lifeline, make sure it’s not really an anchor.

You have a few different options for paying off debt, but they are definitely not all equal. You have debt settlement, debt consolidation, and debt management. Neile Simon joins us today to explain the difference.

Neile Simon is a Certified Credit Counselor with Christian Credit Counselors (CCC), an underwriter of Faith & Finance.

Debt Consolidation: A Quick Fix with Hidden Dangers

Debt consolidation is often seen as an attractive option because it combines multiple debts into one loan with an interest rate between 15% and 22%, depending on your credit score. This can make managing payments easier and allows you to keep your accounts open. However, Nearly warns that this method doesn't address spending habits, which can lead to accumulating more debt. Proverbs 13:11 reminds us:

"Wealth gained hastily will dwindle, but whoever gathers little by little will increase it."

Debt Settlement: Misleading and Risky

Debt settlement companies often use unethical practices, which can be very misleading. They require you to stop paying your creditors, which damages your credit and can lead to severe consequences like legal action, liens on your property, and wage garnishment.

Additionally, any amount written off is considered taxable income. Nearly emphasizes that Christians are called to repay our debts and take responsibility for our actions. Psalm 37:21 reminds us that:

"The wicked borrows but does not pay back."

Debt Management: A Biblical and Effective Solution

Debt management, offered by Christian Credit Counselors, is our preferred method for getting out of debt. This program allows you to honor your debt in full while reducing payments and interest rates. Payments are consolidated into one monthly payment made through the counseling service. Though the accounts enrolled in the program are closed by creditors, you are not required to enroll all accounts. Interest rates on this program range from 1% to 12% APR, enabling you to pay off debt 80% faster. Proverbs 3:27 states:

"Do not withhold good from those to whom it is due, when it is in your power to do it."

Christian Credit Counselors not only provide a practical solution but also offer a biblical approach, including prayer and encouragement throughout the process. For those seeking a trustworthy partner in their debt repayment journey, you can visit: ChristianCreditCounselors.org.

On Today’s Program, Rob Answers Listener Questions:

I'm hearing that people are getting scammed out of the money in their bank accounts. Is online banking safe?
I have about $5,000 left over after paying for my husband's funeral and buying a headstone. I've kept it in a money market checking account, but it isn't making much. Should I move it somewhere else to get it to grow more, like a high-yield savings account? I want this money to be a rainy day/emergency fund, but I also want it to earn a decent interest rate. I have six kids at home, one in college, and I work a minimum job to keep my benefits. I'm unsure if I'll stay home or continue working, so I want this money to be accessible and growing.

Resources Mentioned:

Remember, you can call in to ask your questions every workday at (800) 525-7000. Faith & Finance is also available on Moody Radio Network and American Family Radio. You can also visit FaithFi.com to connect with our online community and partner with us as we help more people live as faithful stewards of God’s resources.

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