Many Americans turning to debt counseling as credit card balances rise nationwide

Edidiong Obot is working on her second master’s degree at Georgetown University. Like many students, she has faced student loans and credit card debt.

“It was somewhere between $30-50,000 in debt and I say that out loud. I’m like me, oh me. Wow, that’s a lot of money,” said Obot, graduate school student.

That’s when Obot said she got advice from her pastor and cousin to try debt counseling.

“I felt like a relief, because I wasn’t being judged,” said Obot. “And I tell people like money is like one of the most vulnerable things that people can share with another person, right? Whether it’s your salary, or how much isn’t your account or your debt.”

Financial experts said Obot’s story is becoming more common. It comes as Americans have more than a trillion dollars of credit card debt nationwide.

Money Management International is one of the nation’s largest nonprofit credit counselors and last month, its advisors have seen a 68% year-over-year increase in clients. Now they say people in their 20s make up the largest group.

“As these student loans have gone back into repayment, we think that that’s creating some additional pressure on that age group,” said Thomas Nitzsche, Money Management International.

The nonprofit offers free credit counseling and for a small fee, you can work with advisors to create a debt management plan.

“We reduce the interest rates down to about 7% overall across all creditors and put you on a plan to be debt free within four to five years,” said Nitzsche.

In just three years, Obot paid off her debt and increased her credit score by 60 points. She said her debt journey changed her relationship with money.

“I look at money now as more of like a tool and a resource and not to abuse it,” said Obot. “But you know, how do you be a better steward of it?”

Despite how uncomfortable it may be to talk about personal finances, Obot believes this process was an investment in herself.

“Like you taking the opportunity to say, ‘hey, I’m going to look for the resources, and I’m going to invest in myself and what you invest in means that you have prioritized it. You see that it takes the time, the effort and the discipline to see the results over time,” said Obot.

Financial advisors said most credit card companies will work with you to bring down your interest rate. Some even have financial hardship programs.