For Those Who Struggle With Guilt From The Debt They Cannot Afford To Pay

Recently, a senior citizen called HELPS director Eric Olsen for help. For several months, she had been skipping medicine and meals to make payments to a debt consolidation company. She was scared, overwhelmed, and running out of macaroni and cheese. Four hundred dollars a month taken from a fixed income left a big dent.  

Mr. Olsen counseled her about the state and federal laws protecting social security, pensions, disability, VA benefits and other forms of retirement income. She understood this meant she did not need to pay the old debt.  However, when asked if this helped relieve her stress, she admitted she didn’t feel right letting the law protect her specifically. Why? She felt guilty.

The law defines “guilt” as moral culpability for an intentionally committed or premeditated act.  Hopefully, our choices are guided by principles beyond the law, but it is good to recognize the intent of this concept. Life does not always wind its way around the path of our intentions. The great recession of 2008 forced many senior citizens to lose jobs and retire early. Carefully planned retirement funds evaporated. Home values, a seeming bedrock of financial security, dropped until equity was lost and forgotten.

Today, nearly half of American senior citizens live within 200 percent of the poverty line. The death of a spouse, illness or any other unexpected calamity can push through this financial cushion pretty quickly, leaving seniors with a series of unpleasant decisions. Add old debt to this mix, and the choices between paying for basic needs and repaying old debt get increasingly difficult.

The good news is that Americans do not want the elderly to suffer. Elected lawmakers on federal and state levels have repeatedly passed legislation protecting the income resources of senior citizens. Courts have ruled in favor of cases affirming the protected natures of senior citizens’ income. Furthermore, while the constitution expressly disfavors an entanglement of government with religion, our country was founded on Judeo-Christian principles. Passages regarding the forgiveness of debt riddle the Old Testament. “Open thy mouth and plead the cause of the poor and needy,” reads Proverbs 31, verse 9.  

A senior citizen is not a “bad person” because he or she cannot afford to repay old debt. Lenders are businesses. Lenders know there may be circumstances when debtors cannot repay loans.  When lenders loan money or give credit to consumers, they attach an interest rate to the loan.  This interest rate exists not only to generate revenue for the business, but also to protect lenders from possible risks. They know there may be circumstances when debtors cannot repay loans.   While many lenders seek to capitalize on guilt to persuade repayment, loans are contracts made with the implied understanding that performance – repayment of the loan – is objectively possible.  Failure to repay outstanding credit or old debt is never a crime. Enforcement of these loans may be sought only through the civil courts. When the debtor is a senior citizen with minimal and/or exempt assets who has protected retirement income, any court judgment for collection of money owed is effectively powerless.

However, debt collectors will never inform senior citizens about the laws protecting their incomes. Harassment does happen. Some collectors will say just about anything to intimidate and terrify senior citizens into depleting their limited resources. Phone calls and letters from collectors can feel like the gnashing teeth of a hungry predator, but the law affords senior citizens some weapons for self-defense.

The Fair Debt Collection Practices Act limits the measures a debt collector can take.  It also requires a termination of all written or phone contact once the debtor sends a “cease and desist letter.”  A template cease and desist letter can be downloaded for free from the internet, including from our website – www.helpsishere.org.   

The guilt over unpaid debt is an understandable struggle. Many of us have a hard time affording ourselves the same compassion we would grant to others. Some things, however, are objectively impossible.  Even if they were offered a million dollars to run a marathon tomorrow, most people couldn’t do it. The humility gained by recognizing that not everything is within our control can become an invaluable tool for self-forgiveness. As Helen Keller said, “failures become victories if they make us wise-hearted.”

Learn More About How HELPS Can HELP restore your financial peace of mind.