Debt Management for Older Adults - National Council on Debt Settlement •Debt Management Plan...

55
Debt Management for Older Adults

Transcript of Debt Management for Older Adults - National Council on Debt Settlement •Debt Management Plan...

Debt Management

for Older Adults

Agenda

1. Changing environment

2. GreenPath’s approach

3. Collaboration with NCOA

4. Ideas for practitioners

American families are struggling as they age

80%Of American

households carry

some form of debt 69% Say non-mortgage

debt is a necessity

1 in 3Americans have

$0 saved for

retirement. $0 Saved for

retirement

American families are struggling.

Row 1 Source: http://www.cnbc.com/2015/07/29/eight-in-10-

americans-are-in-debt.html

Row 2 Source: Labor Center Berkeley;

http://laborcenter.berkeley.edu/pdf/2015/RetirementSavingsCrisis.pdf

Row 3 Source: Boston College;

http://crr.bc.edu/wp-

content/uploads/2016/01/IB_16-2.pdf

American families are struggling

Source: CFSI. United States Census Bureau reports there are 318.9 million people in the USA as of 2014.

$1.2 TStudent loan debt

as of 2015

compared to

$0.2 TIn 2003

Source: https://www.nerdwallet.com/blog/credit-card-

data/average-credit-card-debt-household/

“The past few decades of

widening inequality can be

summed up as significant

income and wealth gains

for those at the very top

and stagnant living

standards for the majority.”

-Fed Chair Janet Yellen

Economic insecurity is changing

Economic insecurity is changing

Icon credit: https://thenounproject.com/efingo/collection/ideas-reborn/?oq=idea&cidx=0&i=366935

So we have to thinkdifferently.

– CONFIDENTIAL –

It’s more than having a stable, well-paying job and a house. (Plus the white picket fence.)

Remixing

When the American Dream fades, people lose faith. With no tools, they feel powerless.

Making it work…

138 million Americans are struggling financially and have no access to financial services.

…for everyone

Center for Financial Services Innovation

We musttake new approaches.

Icon credit: https://thenounproject.com/imicons/collection/chess-solid/?oq=challenge&cidx=0&i=71311

Insights will help usovercome hurdles.

Icon credit: https://thenounproject.com/search/?q=BRAIN&i=652648

We found a new vision for

the American Dream from

our clients.

Prototype: Our private Facebook group

Clients are using our Facebook group to motivate one another and share their American dream. What we’re reading is surprising. Most want more joy, peace and time out of life. Few mention material things.

Increase Resiliency

Spend less than you earn, establish

emergency fund, build credit, make

informed decisions

Improve Cash Flow

Reduce fees, reduce interest, stop living pay check

to pay check, manage bills

Defuse Crisis

Stop collection calls, stabilize housing,

stop garnishment, etc.

Achieve

Dreams

Financial wellness means helping people progress toward achieving their financial dreams.

Grow Assets

Save for retirement

& other goals

We mustengage new types of

partnersIcon credit: https://thenounproject.com/imicons/collection/chess-solid/?oq=challenge&cidx=0&i=71311

New Areas of Collaboration

Core Member

https://s3.amazonaws.com/cfsi-innovation-files/wp-content/uploads/2017/01/19213602/2015-LMI-Paper-FINAL.pdf

https://thenounproject.com/search/?q=hike&i=385

This isn’t just our mission.It’s our passion.

We are proud of our impact

200,000Over

Our counselors are heroes.

Credit: https://www.nerdwallet.com/feature/credit-counselors-made-difference-improved-lives-2015/

SunShine Hefferon

GreenPath is proud to announce 3 of our Financial Experts were recognized in the

2015 “30 Credit Counselors Who Make a Difference” list.

Tina PonderJeffrey Arevalo

Our clients are heroes too.

In November 2015, Katie Atkinson successfully completed her plan with GreenPath, paying off $55,000 in credit card debt.

“It’s amazing, now! When I put the debit card in the ATM, I’ve got this balance and it’s almost the next payday, it’s just incredible. To me, GreenPath was that life ring that they threw, when my waves of debt were crashing in.”

How do we tackle the work?

Our Team• Over 430 employees in 16 states

• Approximately 85% of our employees serve clients directly

• “Client Advocates” – First Contact Team

• “Financial Experts” – Counseling Team

• “Client Success Specialists” – Ongoing Support Team

Our Team

Client Advocates

It takes courage to reach out for help with your finances!

Advocates listen to a client’s needs, validate their first step towards improving their lives, and help assess the correct

service to connect them with.

Our Team

Financial Experts

Financial decisions are complicated.

Our counselors bring empathy, knowledge, and a holistic approach to navigating even the most difficult situations.

Our Team

Client Success Specialists

“The best-laid plans of mice and men often go awry.”

Changing financial behavior can be difficult!

Our team is there to help clients resolve challenges and follow through – encouraging and motivating clients to succeed.

Our Process:

1. Review current financial

situation and goals

2. Look at the credit report

3. Create a detailed monthly

budget

4. Develop a customized

action plan

*Member receives a copy of

the budget and action plan

FINANCIAL

WELLNESS

EXPERTS

Budget with

customized

action plan

Debt

Repayment

Options

Housing

Concerns

Student

Loans

Credit

Reports and

Scores

Financial

Education

Community

Resources

Holistic Financial Counseling

Debt Options • ‘Emergency’ budgeting

• Debt Consolidation Loan

• Debt Settlement

• Debt Management Plan

• Hardship Programs

• Non-Payment

• Use of Assets / Home Equity

• Bankruptcy

1. Helps clients repay debt 100% in full

2. Enables debt to be paid off faster, with less $$

going to interest

Lowered interest rates (to 0% in some cases)

Waived late & over limit fees

Accounts re-aged

Debt Management Plan (DMP)

3. Monthly fee for a DMP

Based on amount of debt being managed

Averages approximately $35

Mortgage Delinquency and Default

Explore all options for resolving the mortgage

delinquency.

• Discuss changes necessary to retain the home

• Establish a budget, set priorities and determine strategies

• Discuss workout options such as traditional forbearance, re-

aging, permanent modifications, and/or foreclosure process

• Call the lender/servicer and help with paperwork

Persona #1: Gary

• Gary is a former teacher that had to retire early due to a car accident. He is now on permanent disability.

• He is 30 days past due on his mortgage and explained “working with his lender is so difficult”. He also has relied on credit cards to cover some medical expenses.

• He lives alone and has short term memory issues resulting from his auto accident.

• Ex-wife is on mortgage, but does not live in the home

• “I am worried that I cannot have the small things and live a normal life”

• Struggles with understanding written forms sent by his lender, but is embarrassed to admit it.

Persona #2: Constance

• Constance is a single woman, supporting 2 grandkids, as well as her disabled adult son.

• She had been ill resulting in missed work and the opportunity for overtime was removed.

• In a 6 month window she had a $800 car repair and needed to replace her furnace.

• These expenses caused her to fall behind on her property taxes, and the tight nature of her budget plus the needs of her family resulted in around 25k in credit card debt.

• She is worried about what can happen if she does not pay her taxes

• This stress has caused her to consider leaving the home, or filing bankruptcy, but she is scared of what this might mean for her family.

Questions in Small Groups

Can you think of situations where you’ve heard of a client who needs these services?

What questions do you have about what these clients could expect?

Our Team

Outreach and Partnerships

A central part of GreenPath’s strategy is to work with partners that can help us reach clients in need of financial counseling.

We have over 20 staff members focused on reaching out to support these partners.

Building trust with partners and demonstrating value to them is an essential part of achieving our mission.

Integrating Financial Counseling

is an effective strategy

https://www1.nyc.gov/assets/dca/downloads/pdf/partners/Research-SupervitaminReport1.pdf

http://cfed.org/programs/integrating_financial_capability/

GreenPath – NCOA Collaboration

• Most practitioners don’t know of reputable resources

• Referring is not a regular practice

• Need for debt help amongst older adults in increasing

• Counseling staff at GreenPath could benefit from better understanding of this population’s needs

• Toolkit: Bit.ly/NCOA-GPFW

GreenPath – NCOA Collaboration

Questions in Small Groups

What questions might you be able to ask of clients to determine if they could benefit from counseling?

Would it be possible to incorporate such questions into your process?

What barriers might there be to incorporating referrals for counseling?

How could we help you to overcome these barriers?

How do I refer?

“You should contact GreenPath. Their financial experts have helped a lot clients that I know. It doesn’t cost anything to talk with them. They'll help you address the issue that you’ve mentioned, plus develop a plan to relieve the financial stress you are feeling.”

Be positive!

• Portray the referral positively

• Warm transfer/call with the member

• Call yourself!

Help prevent clients

from taking the wrong path!

What was the biggest benefit you got

out of the counseling ?

“Ericka was great. She made me feel very comfortable and provided me with great information and a clear path on where to start. I really appreciated having her as the Financial Counselor.”

“Getting a handle on a 30% interest credit card bill.”

“I understand so much more about how to get my credit score up.”

“A budget was really helpful to view. Education of repayment options for debt was useful and beneficial to my financial situation.”

“Realistic look at my debt repayment plan (doing the math)”

“I had lost control over my finances and kept experiencing overdrafts even though it was my best intention not to get further in debt. The stress of my situation was making me suicidal. I am much better financially and mentally now”

Next Steps

• Sign up as a community partner

• Complete your own counseling session

• Review the toolkit at Bit.ly/NCOA-GPFW

• Attend future webinars greenpathlive.com

866-217-0543www.greenpath.com