East Tenn. man frees family of debt with help

East Tenn. man frees family of debt with help from local debt counselor

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By DON DARE
6 On Your Side Consumer Investigator

KNOXVILLE (WATE) - Are you burdened with debt? Are you paying only minimum payment on your credit cards? Many people struggle with it every day.

The latest numbers show the average credit card debt in America is more than $7,000. 

Youth pastor Adam Jones had more than $60,000 in debt, but that huge weight has been lifted from his shoulders.

Burdened with debt that started in college, this 34-year-old youth pastor and father of two daughters is at last debt free.

His path towards spending beyond his means started as a freshman at Lee University in Cleveland, Tenn. where he says credit cards were given out like candy.

"Everybody got the same credit card offer. All of a sudden, you started going out to eat, bought new shoes, new clothes. It's newfound freedom until that statement comes in and you realize, 'Oh, I don't have a job up here,'" said Jones.

After college and in Georgia where he met and married Jill, the couple at first tried to watch their spending, but loans weighed them down.

"We had student loans. What was not absorbed by student loans, we added on credit card debt. We had good credit card rates at the time. So we would retrench with those balances, zero percent, just keep transferring, and then when the recession hit, all of a sudden those zero percent transfer balances went away. There were times where we sat there at the end of the month saying where is the money going to come from?"

Their debt amounted to $62,000. They paid minimum payments on more than half a dozen credit cards.

"At what point did you decide, we've got to do something?" we asked.

"When there was a strain on the marriage," replied Jones.

It was when the Joneses turned to someone like Billy Davis, a credit counselor with ClearPoint, that they started to claw their way of debt.

"If you have an interest rate of 25, 27, or 29 percent, which a lot of people do, then very little is going to go to your principal. That's why it takes so long to pay this debt off," said debt counselor Marcy Frankel.    

At ClearPoint, the Jones family was put on a debt management plan. It's a systematic way to pay down your outstanding debt through monthly deposits with this non-profit credit counseling agency.

"First thing I tell my clients is to keep a budget," said Frankel.

The budget consists of money coming in, and money going out - expenses for things rent, student or car loans, groceries, utilities, buying gas for the car, clothing for the kids, and snacks for yourself.

Through pre-arranged agreements with credit card companies, ClearPoint is able to negotiate lower interest rates for serious minding people determined who stick to their debt management plan.

What we do is we take their unsecured debts, put it into one plan. They would make one payment to us once a month and we disperse the funds out to the creditors for them," said Frankel.

Jones and his wife did it. They are debt free. They completed their five year debt management plan in 4.5 years.

"No more sleepless nights, no more stress filled days, arguments in the marriage. We're free and it's taken a lot of weight off of our shoulders," said Jones.

If you would like counseling from ClearPoint, you can call them at (800) 251-2227.

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