Budget Rehab: How to Stop Paying Only Interest and Make Real Progress on Credit Card Debt

Summary

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Episode Summary

Podcast: NerdWallet’s Smart Money Podcast

Episode: Budget Rehab: How to Stop Paying Only Interest and Make Real Progress on Credit Card Debt

Date: May 18, 2026

Hosts: Sean Pyles, CFP® & Elizabeth Ayoola

Guest: Jessica (Listener)

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Overview

This episode focuses on practical strategies for getting out of credit card debt when you feel stuck paying interest and making little progress on the balance. Listener Jessica joins Sean and Elizabeth to share her real-life struggles with $25,000 in credit card debt. Together, they explore debt management options, budgeting challenges, and mindset shifts to help anyone feeling overwhelmed by debt take confident next steps.

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Key Discussion Points & Insights

1. Jessica’s Story: How the Debt Built Up

• Background: Jessica, a Bay Area mother of two, discusses her divorce, job loss, and transition from stay-at-home mom to the workforce as the root causes of her debt accumulation.
• Debt Breakdown:
  • Three credit cards totaling ~$25,000 and a car loan.
  • Credit card interest rates: Chase (18%), Citibank (24%), Capital One (11%) — all cards maxed out.
• Budget Strain:
  • Paying $1,950 in rent for a 1-bedroom apartment.
  • $1,200/month transportation costs (car payment, insurance, tolls, gas).
  • Childcare costs close to $1,000/month.
  • Monthly take-home pay: $3,800 (soon increasing to $37/hour).
• Quote:
  “Most of that money went to my living expenses...I did spend some frivolously, and I’m not very proud of that.” — Jessica (05:43)

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2. Recognizing the Debt Trap

• Transition Point: Jessica realized she was trapped when she could only make minimum payments, with balances barely moving due to high interest.
• Utilization Impact: Nearly 100% credit utilization hurting her credit score (last checked: 630).
• Quote:
  “I wasn’t able to pay more than my minimum payment…now I’m just paying the interest, not the principal.” — Jessica (07:34 & 09:48)

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3. Budget Review & Expense Pressures

• Major Expenses: Rent and childcare are dominating, with little left for savings or emergencies.
• Big Win Coming: Upcoming job switch and imminent reduction in childcare costs will provide some relief.
• Quote:
  “After August, no more preschool. I’ll just pay for their aftercare, which will probably be about $300 a month. So [I’ll] get $400 something back. Plus I’m getting more money in salary, so I think that might give me a little bit more cushion.” — Jessica (15:02)

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4. Exploring Debt Repayment Options

A. Debt Management vs. Debt Settlement

• Debt Settlement Risks:
  • Sean warns against for-profit debt settlement companies, like National Debt Relief:
    “That can be really, really risky and really expensive because you can be sued by your credit card company. I strongly recommend not engaging with them at all.” — Sean (20:20)
• Nonprofit Credit Counseling:
  • Sean advocates for debt management plans (DMPs) via nonprofit agencies:
    “They can often cut your credit card interest rate in half or more...You actually make progress instead of spinning your wheels.” — Sean (21:23)
  • Organizations to consider: Money Management International, or those accredited by the NFCC or Financial Counseling Association of America.
  • Downsides: Might have to close credit cards, affecting credit score, but can help break the cycle of just paying interest.

B. Other Options Discussed

• Balance Transfer Cards: Mentioned but likely not available with Jessica’s current credit standing.
• Bankruptcy:
  • Can discharge debt quickly, but might complicate renting/buying a home.
  • Quote: “With bankruptcy, you can be out of debt in a few months…but it might make finding an apartment more of a challenge.” — Sean (29:22)

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5. Building Healthier Financial Habits

• Developing Resilience: Jessica highlights the need for patience and self-compassion while rebuilding post-divorce.
• Future Prevention:
  • The hosts stress emergency funds, living within means, and budgeting skills as key to staying out of debt after resolving current balances.
  • “You can pay off all the debt and find yourself right back in that same position if you don’t adjust the habits that got you there.” — Elizabeth (26:56)
• Visualizing Life After Debt:
  • Jessica dreams of buying a home and providing stability for her daughters:
    “Yes, I can breathe and finally put money towards a condo or a single family home for my little family and I…That’s why I have to get this done.” — Jessica (27:47)

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6. Actionable Next Steps & Resources

• Immediate Steps:
  • Get a full evaluation with a nonprofit credit counselor.
  • Consult a bankruptcy attorney for a free assessment of alternatives.
• Recommendation:
  “Understanding what might be the best, fastest, least expensive, lowest interest way to get out of your debt is probably going to be the smartest thing to do — just to do your research before you jump into one path or another.” — Sean (25:40)
• NerdWallet Resource: An article on updated debt pay down strategies for 2026 (linked in episode description).

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Notable Quotes & Timestamps

• On credit utilization and the debt trap:
  “Just your utilization is like almost 100%.” — Sean, (10:54)
  “It's a little scary how quickly credit card debt can rack up, in part because the interest rates are so high.” — Sean, (09:33)

• On the power of a debt management plan:
  “They want you to have a stable income...they can often cut your credit card interest rate in half or more.” — Sean, (21:23)

• On habit change:
  “You can pay off all the debt and find yourself right back in that same credit card debt if you don’t adjust the habits that got you there.” — Elizabeth, (26:56)

• On hope and motivation:
  “Well, having that image in your mind is such a strong motivator...Just focusing on why you’re doing this hard thing is going to make it worth it.” — Sean, (28:08)

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Timestamps for Key Segments

| Segment | Timestamp | |---------------------------------------------------|--------------| | Jessica introduces her background | 03:34-05:16 | | How Jessica accumulated debt | 05:43-07:18 | | Realization that debt is not going down | 07:25-09:33 | | Current debt situation, interest rates | 10:05-10:18 | | Budget breakdown and cost pressures | 11:18-15:31 | | Childcare/employment changes improving budget | 15:02-15:31 | | Minimum payments hurt, not lowering balances | 16:04-17:06 | | Discussion on debt settlement vs. management | 20:12-22:56 | | Exploring bankruptcy and motivations | 23:14-25:56 | | Importance of new financial habits | 26:55-27:28 | | Jessica visualizes life after debt | 27:47-28:08 | | Choosing a path: counseling vs. bankruptcy | 28:33-30:03 |

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Takeaways

• Don’t just pay interest: There are ways to reduce your monthly costs and begin making real progress, especially through nonprofit credit counseling.
• Avoid debt settlement firms: For-profit agencies may make matters worse with fees and risk of being sued.
• Credit counseling may require sacrifices: You may have to close cards or impact your score temporarily but can get debt-free over several years.
• Research all options: Even bankruptcy may be less damaging long-term than years stuck in debt.
• Build new habits: A changed approach to budgeting and saving ensures lasting financial recovery.

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Final Reflections

Jessica’s story underscores the emotional and logistical complexity of managing debt with a limited budget and family responsibilities. The episode expertly balances empathy with actionable advice, making it an empowering listen and a deep well of practical strategies for anyone feeling stuck in debt.

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For more resources, see NerdWallet's updated 2026 debt pay down guide (link in episode description).

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End of Summary

Transcript

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[B]

Imagine opening your account and seeing the same thing month after month. You're making payments, but the balance is barely moving. That's where today's listener is with $25,000 in debt and a big question. How do I pay it down and get ahead?

[C]

Welcome to NerdWallet's Smart Money podcast where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Pyles.

[B]

And I'm Elizabeth Ayola. Now we have another listener question. Today we heard from the Grapevine that you guys love listener questions. This episode's one comes from Jessica and she's actually joining us today and she has a question about debt recovery. So we're going to be doing a little bit of a debt rehab episode and looking at her budget and also looking at her debt pay down options. Hello, Jessica.

[D]

Hi. Thanks for having me, guys.

[C]

Jessica, welcome to Smart Money. So we like to start often with an icebreaker. Since you live in California where I used to live in the Bay Area, I would love to hear what's maybe your favorite thing about living in California.

[D]

Oh, I am a Bay Area girl through and through. So I would probably have to say all of the diversity that we have, all of the great food. I can eat Burmese one day and eat Mexican the next day and Thai the next day. That's the really cool thing about living up here, I think.

[B]

And are you a native? How long have you been there?

[D]

I am. I'm born and raised Bay Area. My family, everybody's here.

[B]

So tell us a bit about your family structure right now. What's going on? Do you have kids? Tell us a bit about that.

[D]

I have two daughters. They are seven and four and they're really, really fun to play with and they are really, really expensive, but they're fun. My 7 year old's in the first grade and she's really, really smart and she has a lot of friends and I'm really proud of her because she's the best could ever ask for. She's always, my four year old is just coming out of her shell and she's got so many friends and she's, she used to be a little shy. Now she's out singing and making new friends and she's going to TK in August. So I'm really proud of her and that I, I got Divorced two years ago. And now I am with my partner, who I love very much, and we've been friends for. For almost 20 years. So kind of a long time set in stone. It was meant to be. So. And then I have a cat and a dog, and my cat is crazy.

[B]

Sean can relate.

[C]

I can relate.

[A]

Yeah.

[C]

My cat, he has a mind of his own. He really likes to get things his way. And if he doesn't, he'll let you know by biting you.

[B]

Oh, my God. I'm not coming over, Sean. What?

[C]

You will. You will definitely come over when you're in Portland. I will make it happen.

[B]

Oh, my God. Oh, my God. All right, Jessica, let's get into your finances. Thanks for giving us a little bit of background there. You wrote to us because you wanted to talk about strategies for your debt. So let's talk about how much debt that you currently have.

[D]

So I have three credit cards and a car payment. My three credit cards, I think add up to about $25,000, mostly from losing or being laid off from jobs and having to take low paying jobs. Previously. I was a stay at home mom for five years and I didn't have any retirement or anything. So I did leave that divorce with a bit of a settlement, but most of that money went to my living expenses and kind of acclimating myself back into not being in a marriage, not being supported. And then I. I will say, like, I did spend some frivolously, and I'm not very proud of that. So most of it just kind of came from not preparing for, you know, for the future or like preparing for something bad to happen. I think that is why I got into the debt as well. I needed to get a new car after my divorce because the car I had gotten in the divorce wouldn't have lasted me too much longer because I'm a commuter. So I did get a car. I was able to put $12,000 down on that car. So 6,000 from a trade in and then I put $6,000 of my own money. So I got a really good deal at the time. The interest rates were not great, but I had really good credit at the time. So they gave me 6.0%. That's the best that they could do in 2024. Interest rates were just kind of wonky, but I did get a pretty good deal. I only pay $434 a month on

[C]

my car note for a current car payment. That's not horrible because cars are so expensive nowadays.

[D]

I'm proud of that.

[C]

So, Jessica, I'd like to hear when you began that your debt was becoming a problem that was not as easy to get out of as you maybe thought it was going to be.

[D]

I think when I started realizing, like, I wasn't able to pay more than my minimum payment previously when I had my credit cards, like, I would pay the balance off or I would pay way more than the minimum payment just to make sure my payments were going down. But because I had got laid off, the little bit of savings that I did have, I used that for my major expenses like rent, childcare, daycare, and my car note, car insurance. I had about three, three and a half months worth of savings for that. And so the rest of my money that I was getting in unemployment, I was using to pay down some of my credit card debt. And. But I used to also had to use my credit card to buy groceries and gas and such, so. And then I took a job that was paying me $25 an hour. I went from $60 an hour to $40 an hour to $25 an hour. It was really, really stressful. And so my savings went down because I used, you know, most of that to kind of help me pay for things, for my rent and my bigger expenses, like I said, for my childcare and such.

[B]

And then, Jessica, how long would you say, in terms of the timeline, did it take you to accumulate that debt, or when did you notice it start snowballing? Because I know you said you lost your job. Was it three times that you lost your job? So how long did it take?

[D]

I started accumulating the debt where I couldn't pay. Six months or so? Six, six, seven months? Yeah, because when I lost my job, I, I had pretty low credit card debt, so I was able to still pay it. But again, I was trying to save my savings for my big expenses. So at that point I was just kind of paying the minimum payments. And because I was getting unemployment, it's

[C]

a little scary how quickly credit card debt can rack up, in part because the interest rates are so high.

[A]

So we're going to talk through some

[C]

ways we can get out of it, but I'd like to hear, to start how you've been paying off your debt so far. Do you have a payoff strategy or what's been your tactic, Texas, so far?

[D]

My Chase card and my Citibank card, they offer, like, payment plans, but really it's just me paying the interest. I'm not making any kind of dent in the actual principal of, of the credit card debt.

[C]

What are the interest rates on these

[D]

debts, if you can recall, chase is about 18%, I believe Citibank's the highest, 24%. And then my capital one is 11% and they're all maxed out.

[B]

And with these credit card payment plans that you're doing as well, Jessica, have the lenders offered you, for example, lower interest rates or to waive any fees?

[D]

No, they just offered for me to do the payment plan so that it doesn't put a dent in my credit. And then I'm not like, it's not showing that I'm like making late payments.

[C]

Do you know your credit score?

[D]

Last time I checked it was 6:30. But that's probably because I pay my credit. I mean, I pay my car note on time and I am making payments on my credit card. But then, you know, it's just.

[C]

Just your utilization is like almost 100%.

[D]

Exactly.

[B]

All right, Jessica, before we go into debt repayment options, let's look at your budget because that's going to determine what, what the best debt repayment option is for you. So thank you for sending in your numbers and being vulnerable and sharing your finances with us. Correct me if I'm wrong, but with you recently got a new job. That's correct. Congratulations.

[D]

We love to hear that.

[B]

And after tax, you're making around $3,800, is that right?

[D]

Yes. Yes.

[B]

Okay, So I noticed that you are paying almost $2,000 on rent. Does that feel comfortable for you right now?

[D]

No, but unfortunately where we that it's pretty expensive. When I moved in here, it was 1850 and then after a year they raised the rent a hundred dollars. And so I live in a one bedroom apartment. It's getting really, really crowded. We have two kids and two animals. So ideally I would like to get a bigger place, but that's really all that I can find in a decent neighborhood for that price.

[C]

Housing in the Bay Area is so challenging to find at all. And then if you do find something that fits what your family needs, it's going to be expensive.

[D]

Yes, yes, unfortunately.

[B]

Do you pay $0 for medical care? How does that work?

[D]

Because I was going between jobs, I just didn't have any medical care and so I wasn't paying on it. They're taking about $130 out of my paycheck for medical care, so I'm paying that. And then my ex wife, she provides the medical care for our two daughters, which is helpful through her job. So yeah, I wasn't paying anything for a while and I probably won't be paying after I accept a different position that doesn't offer benefits, but offers more

[B]

money that gives you some financial relief. Something else that stood out to me is your transportation costs. It looks like you're paying almost twelve hundred dollars a month on total transportation costs, including your car note, gas, all the things.

[D]

Yeah, car notes and gas. Gas is really, really expensive right now, you know. And insurance. My insurance, about $250 a month for full coverage. My car note is $436 a month. And then I also cross the bridge every day.

[B]

I.

[C]

The bridge tolls in the Bay Area are seriously expensive.

[D]

$8 a day.

[B]

Wow, that's high.

[D]

Yeah, it's crazy. Yeah. So it's pretty high just to travel around every day.

[C]

Okay. I also noticed in your budget that you have about $1,000 a month in legal obligations. What is that?

[D]

I just put that as like, for my kids, child care services. So, like, my daughter's preschool pays $725 a month. That's just my portion. And then we also have a lovely woman that picks our daughters up and they stay with her for a couple hours while we are in between work. And that's about $400, 3 50amonth there. So that's. That's what I meant by legal. I didn't know how to like.

[C]

Yeah, I wasn't sure if you had like a judgment or any sort of alimony or anything. Okay, That's a relief. Yes. Be grateful to not have that.

[D]

Yes.

[C]

But there's still a sort of fundamental tension in your budget, which is that your base needs, expenses are greater than your income.

[D]

Yes.

[C]

And so that's a really challenging place to be. And I assume this is in part because you're paying so much in your debts on an ongoing basis. Is that right?

[D]

Yes. Yes. Okay. But one thing that I will say, I did accept a position that I'll be making more money, so that's a really helpful thing. I'll be making $37 an hour instead of $30 an hour.

[C]

Okay.

[D]

And then I also, my daughter, my youngest daughter will be leaving preschool next month so that, congratulations, you get money back.

[B]

Oh, my God, 750.

[D]

I do have to pay during the summer for summer care. I think that will probably be around 500. So 200 less. And then after August, no more preschool. I'll just pay for their aftercare, which will probably be about 300amonth. So get 400 something dollars back. Plus I'm getting more money in salary, so I think that might give me a little bit more cushion there.

[A]

Yeah.

[C]

That'll give you some breathing room, because I imagine right now that you aren't really able to save anything, are you?

[D]

No, not at all. And, I mean, I barely can save $50 here and there if I can. And it's really stressful for me because I need to have some kind of cushion in. In case I. You know, I just had to borrow money from my parents to get new tires for my car. So. Yeah, so that's. That's. It's been a really, like, stressful time for me and. Yeah.

[B]

Jessica, how much of your budget, if you could estimate right now, is going towards paying down your debt? Do you have, like, a dollar amount?

[D]

You can think of about 550amonth across

[B]

all three credit cards?

[D]

Yeah. And the only one that really kind of knocks the principal down is my capital one. That's more of like a starter credit card. And they don't charge overdraft fees. They don't charge overcharging fees. I took that off because they kept letting charges go through, like, reoccurring charges go through. I took that off because it was like building. But that minimum payment has stayed the same. It hasn't gone any higher. So I've been able to make that payment, but the other two are kind of, like, closed at the moment until I make the actual minimum payment that I owe, which is like 500 for the. For the Citibank, and I think like 385 for the Chase. So I don't know if I should, like, do a debt consolidation program or. I don't know.

[A]

We're back in a minute.

[C]

Stay tuned.

[A]

The following is a paid sponsorship, not an endorsement by Nerdwald's editorial team. Today's episode is sponsored by Bilt.

[B]

You've heard me talk about Bilt as the loyalty program that lets you earn points on rent wherever you live. And they just leveled up even more. As of 2026, renters and homeowners can also earn up to 1.25x points on their housing payments.

[A]

This is thanks to Bilt's three new credit cards, the Palladium card, Obsidian card, and Blue card. All three can turn your housing payments, rent or mortgage into flexible rewards. So you can choose the card that fits your lifestyle without missing out on points and exclusive benefits.

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Built points can be redeemed at top airlines and hotels, Amazon.com purchases, future rent payments, and so much more. Built points have also been ranked by top publications as the industry's most valuable point currency.

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okay, well, so here's where I have a lot of thoughts.

[B]

Jessica. Sean used to write all about debt, so he is definitely an expert in this area.

[C]

Yeah, on top of being a financial planner. Although caveat, I'm not your financial planner, just my legal team wants me to say that. So there's this term debt consolidation that gets thrown around a lot and it can mean different things to different people. There are debt settlement companies where you just stop making payments to your credit card companies and you divert all of your money to them, and then they negotiate directly with your credit card company. And that can be really, really risky and really expensive because you can be sued by your credit card company. So I'm really not a fan of debt settlement. And this is their companies, like National Debt Relief. I strongly recommend not engaging with them at all. On the other side, there's another form of debt consolidation, and this is beyond, you know, loans or credit cards. That's actually called nonprofit credit counseling. And with that, you would get into something that's called a debt management plan. And these nonprofit organizations were actually started by the credit card companies back in the 70s because people couldn't afford their payments. So it's a way for you to have your debt be more affordable while still be in good standing with your credit card companies.

[A]

The reason why I think you might

[C]

be a good candidate for this is because they want you to have a stable income, because you need to make regular payments when you're on this plan, which will last between three and five years or so. And, you know, if you miss a payment, that can derail the plan plan. But why I really like them is that they can often cut your credit card interest rate in half or more. And that makes it so you can actually get some traction and pay off your debt faster instead of only putting money toward the interest, which is where you are right now. One organization that I'm a fan of is called Money Management International. They've been around for a while. They help a lot of clients. They can make it so that again, you are actually making progress on your debt instead of just spinning your wheels and feeling like you're not getting anywhere with your debt payoff.

[D]

And.

[B]

And if you want to choose your own agency, Jessica, you should choose one that's accredited by the national foundation for Credit Counseling or the Financial Counseling association of America. So you can kind of look through the one Sean is recommending and those to see where you land. And also I do want to say something to be, not beware of, because I agree with Sean that credit counseling is very helpful. I used to work for a credit counseling agency, but you want to keep in mind that these agencies will sometimes ask you to discontinue the use of your credit cards. So that's sometimes what puts people off of using them. And you can also may have to close some of your accounts. And obviously that may temporarily impact your credit Score because it can affect your credit history, your credit utilization. It's an option to help you get out of debt in a structured way and as Sean said, help you to pay less in your overall debt because the interest rates are cut.

[C]

Yeah. And you're at a place right now where your debt is just accumulating and you're not able to go forward with anything. So I'd like to maybe hear from you how you might want to get out of this and whether you've explored any other options, including like maybe a balance transfer, credit card, or talking with a bankruptcy attorney.

[D]

I haven't talked to a bankruptcy attorney just because, well, I can't really afford to file for bankruptcy, number one.

[C]

And number two, that's a common challenge.

[D]

Yeah. I was leaning towards some kind of, like, debt management program, but I'm glad that you have strayed me away from the national. That relief. I had reached out to them just to inquire. And then of course, they kept calling me, but I never went with them. And so I'm glad that I know now that would be a bad idea. I was trying to really kind of see if I could just pay it myself, pay it off, but it's just becoming really. It's becoming too hard. And I have this issue where, like, I have these goals. I want to get these things done quickly. But with my situation and being a stay at home mom for five years and not being able to have retirement and not working, I'm really kind of starting from scratch. And I have to be patient with myself in that regard and know, like, okay, I might not really start doing what I want to do till I'm 45. And that kind of is like, oh, man, that sucks. But it's also like, some people don't get their dream job to their 50. Like, it doesn't matter your age. It's about, you know, the hard work that you put in. So for me, I'm just trying to be graceful with myself and, like, instead of putting my head down in the sand and not doing anything about it, I just want to get it done so that I can start doing things that I want to do.

[C]

So two good next steps for you, Jessica, would be to call a debt management nonprofit a credit counseling agency to help you get an evaluation and see if they might be able to help you with your current situation. It's also often recommended before you sign on to one of these programs to get a free consultation from a bankruptcy attorney just so they can talk through what your path might look like if you went with them. Because people can often discharge their debts in just a few months. And yes, getting the filing money up front can be a little challenging, but they often have ways to work with clients to get that done. Because if you are on a debt management plan or doing debt settlement or paying it off on your own, it's going to be a few years before you're fully out of this debt. And just understanding what might be the best, fastest, least expensive, lowest interest way to get out of your debt is probably going to be the smartest thing to do. Just to do your research before you jump into one path or another.

[D]

Okay, good to know. Thank you. My partner just had to file for bankruptcy, so I know that there's information that I can gather from her in that regard. So it's good that I have some. Some options to look into.

[C]

Yeah, the one thing I'll say after you file for bankruptcy is that your credit score can actually rebound pretty quickly. And that's a common concern people. In fact, it's actually quite predatory. A lot of credit card companies will mail people who just filed bankruptcy a bunch of offers for new credit cards because they know that you can't file for another seven to 10 years, depending on what type of bankruptcy you're pursuing. So just be really careful with those credit card offers that are coming in the mail. You're probably receiving them right now if your partner just filed. So just throw them away and just kind of rethink your habits around credit cards, too. It sounds like you were just putting life necessities on your credit cards and you weren't spending frivolously. But they can be a really tempting financial crutch where you, you know, yes, you're buying necessities, but then you can use it for something else that's maybe not so necessary. And then, yeah, the debt racks up. So just reorienting your attitude around what this financial tool is can be helpful, because as you're seeing, they can be pretty dangerous, too.

[D]

Absolutely.

[B]

On a positive note, Jessica, thinking to the future, when you do pay down this debt, as Shawn is saying, it's so important to maybe think about financial habits that you can start putting in place that will help you to stay out debt. You're already on a great path thinking about having an emergency fund. That's one great way to stay out of debt. Making sure that you are, you know, developing your skills when it comes to budgeting, ensuring you're living within your means, and all these other things can just help you to stay out of debt. Because another thing that people don't talk about enough is that you can pay off all the debt and find yourself right back in that same credit card debt if you don't adjust the habits that got you there.

[C]

And so, Jessica, I mean, we've covered a few different ways that you can get out of your debt, but one thing I really want to focus on is what it'll mean to you to be out of this debt, how it'll feel, and what you might be able to do with all the money that you're putting towards your debt on a regular basis. So can you picture what your life will be like once you're out of debt?

[D]

Yes, I can breathe and I can finally, like, put money towards a condo or a single family home for my little family and I, and possibly an engagement ring or something like that, you know, like, like those are big goals of mine. I can picture it. That's why I'm like, I have to get this done.

[C]

Well, having that image in your mind is such a strong motivator. So even though there are going to be ups and downs, no matter which path you take, whether you're doing credit counseling or you are doing bankruptcy, just focusing on why you're doing this hard thing is going to make it worth it.

[B]

So, Jessica, we've talked about so many different options. Which one is pulling you the most? And then also it could be that you say none and you want to diy, but. Yeah. What are your thoughts?

[D]

I'm definitely thinking about the debt program that you mentioned, Sean. Counseling, the credit counseling. The thing I think that's holding me up for bankruptcy is like, I would like to be able to get an apartment that's bigger. And I'm afraid that that will deter me from being able to get a two bedroom apartment like the place that I'm living in now. They don't accept people that have. Have had bankruptcy. So that is something that I'm a little apprehensive about because I just want to make sure that I can do that at least. You know, if that is something that will be better for me, you know, then I might have to, I'm not sure. But for now, I think the counseling one is a better option. At the moment.

[C]

It's worth having a conversation again with both a credit counselor at one of these nonprofit credit counseling agencies and a bankruptcy attorney too. I really want to emphasize that because the credit counselor, at the end of the day, they kind of have an incentive to get you into one of their programs. Right. And it does take a while to fully get through it. Whereas with bankruptcy, you probably saw this with your partner, it can be resolved in just a few months. So thinking about time, you were mentioning that you feel like time is kind of slipping by as a way to reclaim some of that time. This might be a good option for you. But then you do have to weigh the practical reality of yeah, it might make finding an apartment that's a little bigger more of a challenge. So that's just a trade off there.

[D]

Yeah. Well, thank you for those options. I really didn't know where to go, to be honest.

[C]

We're so happy to help you.

[D]

I think I'm gonna do some really hard thinking about what would be best for me and my little family. And I'm really grateful that you guys have given me some tools on what I can do to make this a less stressful time in my life or to just kind of like put my head forward and do something about it.

[B]

If you haven't seen it already, we have an article on different debt pay down strategies for 2026 that you can read through. And it should include the credit counseling option as well. And of course, we'll include that in the episode description.

[D]

Awesome. Thank you guys.

[B]

All right, Jessica, will you please read us out?

[D]

Remember, listener, that we're here to answer your money questions. So turn to the Nerds and call or text us your questions at 901-730-6373. That's 901-730 N E R D. You can also email [e-mail] join us next

[B]

time to hear about what happens after you've reached a perfect credit score. According to a listener, you do not get a toaster. Follow Smart Money on your favorite podcast app that includes Spotify, Apple Podcasts, and iHeartRadio to automatically download new episodes.

[C]

Here's our brief disclaimer. We are not your financial or investment advisors. This nerdy info is just for educational and entertainment purposes and may not apply to your specific circumstances.

[B]

This episode is produced by Tess Viglund, Hilary Georgie help with editing, Eve Crobman, Halmar Audio and our video production. And a big thank you to nerdwallis editors for all of their help.

[C]

And with that said, until next time, turn to the nerds.

[A]

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