Sally Herigstad is a certified public accountant and the author of "Help! I Can't Pay My Bills: Surviving a Financial Crisis" (St. Martin's Press, 2006). She writes "To Her Credit," a weekly reader Q&A column about issues involving women, credit and debt, for CreditCards.com, and also writes regularly for MSN Money, Interest.com and Bankrate.com, and has guested on Martha Steward Radio and other programs. See her website SallyHerigstad.com for more personal finance tips and free budgeting worksheets. Ask Sally a question, or read her previous answers in the To Her Credit archive
Dear To Her Credit,
I need help fast. We just received notice of a $4,000 garnishment from my
husband's payroll that will be taken out over the next four months. I want to
know where I can go to get help. I would like a debt counselor to help us find
a legitimate company to help us eliminate our debt for the next year or two
Finding a debt counselor is easy. Finding one who can
eliminate or suspend your debts for the next year or two, without you filing
for bankruptcy or making payments on those debts, is impossible. No one has magical
power to make your debts go away.
It's no wonder many people think some kind of debt elimination
is possible, however. Anyone who listens to the radio or looks at popup ads on
the Internet might think companies were lining up to take people's debt
problems away. Some ads prey on people's hopes that the government will come to
their rescue, like the Obama Debt Bailout Program scam.
Other ads and articles on the Internet claim debt
elimination is possible because our entire banking system and
"government" is a fraud. Yes, they put quotation marks around the
word government. Funny, no one thinks
the banking system is so bad when they're spending the banks' money; only when
they have to pay it back. And the same article that didn't seem to believe in our
government quoted FTC rules protecting debtors. It sounds like they want it
The simple truth is: Companies that promise to eliminate
your debts with some secret program, government or otherwise, are scams. Stay
away from them. They'll only take your personal information and your money. In
the meantime, your problems will only get worse.
Here's what to do about your $4,000 debt and garnishment:
Your state generally has a form you can use to claim exemptions
from wage garnishment. The form is generally available at the nearest small
claims clerk or the sheriff's or marshal's office, or online. Filing this form
protects your basic living expenses from garnishment, but hurry -- the form
must be filed within a certain number of days from the time you receive the
notice. After you file the claim, the court decides how much of your husband's
pay is required for living expenses and cannot be garnished.
Next, find ways to get by on your reduced income for the
next four months. Here are some ways you might be able to do that:
Stop all unnecessary expenses. No eating out
(not even fast food or cafeteria lunches), no movies, no new video games or
electronics, no clothes for anyone past the growing stage until the four months
are up. Cancel Internet subscriptions, cable TV, gym memberships.
Sell something. If you have a newer car, sell it
and buy an old, serviceable one. Your mechanic can tell you which ones are the
most dependable. If you have two cars, sell one. Have a garage sale.
Work extra hours. You and your husband might be
able to volunteer for more hours at work, or pick up some extra income
delivering pizza, babysitting, doing fall yard cleanup, and so on.
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