Episode 13

October 07, 2022

00:32:21

S1:E13 Howard Dvorkin - Dealing with Debt

Hosted by

Tony Siebers
S1:E13 Howard Dvorkin - Dealing with Debt
Parent Projects
S1:E13 Howard Dvorkin - Dealing with Debt

Oct 07 2022 | 00:32:21

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Show Notes

Dealing with Debt. Howard Dvorkin is Chairman of debt.com, and founder of one of the most highly regarded credit counseling companies; he's a noted debt and credit expert in the United States and has played an instrumental role in drafting both State and Federal Legislation. He is a former consultant to the Board of Directors for the Association of Credit Counseling Professionals (ACCPros) and is the past president of the Association of Independent Consumer Credit Counseling Agencies (AICCCA). Are your parents spending too much? It may be time to sit down with them but not at the dinner table, we discuss this and more to help you on your path of a Parent Project, on this episode of the Parent Projects Podcast. I'm Tony Siebers.
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Episode Transcript

Speaker 1 00:00:06 You're listening to Parent Projects. Speaker 2 00:00:10 Hey, welcome to this week. Show everybody, certified public accountant, author of a couple of books, Credit Hill PowerUp, founder of debt.com. Uh, Howard Devork is with us today, and you're gonna get some awesome opportunities to get some insights in how to not take no for an answer. How do you keep working through it, pacing things along? Uh, it is ultimately debt week for us, and we'll be talking about those issues. For those of you that have a parent project and debt, uh, with your family may be weighing in some way, shape, or form on the project. So stay tuned. Speaker 1 00:01:05 You're listening to Parent Projects, a Family Media and Technology Group Production. Now, here's your host, Tony Sears, Speaker 2 00:01:15 And welcome everybody to this week's show. Uh, we've, we've got Howard Devor and the chairman of debt.com, and I really had a, a blessed opportunity to have some conversations before we get to sneak in with you guys. Uh, and I, I think it's one of the, the top things I really look forward to you being able to understand is how to keep moving, uh, and, and that theme, the tools that you might need, the complexities in here. Uh, Howard, welcome to the show. Thanks for joining us today. Speaker 4 00:01:45 Thanks, Tony for having me. Speaker 2 00:01:47 And, uh, Fort Lauderdale, Florida is, uh, is where you get to hail for, for today. Uh, how long have you been out in Florida? Speaker 4 00:01:55 Uh, came down here for spring break and never left. Uh, so I hailed from New Jersey originally, uh, which I was just there this past weekend and had a great time. And it reminds me of the roots and then kind of what makes my fiber. But certainly living in Florida, uh, uh, allows me to have certain opportunities, which is nice weather year round, and, uh, little heat in the summertime, which is a little rough, but I, I'll take it rather than the bitter cold. But, you know, it's interesting on this topic, and I was really excited to talk to you today about the topic simply because, you know, we, in Florida, when I first moved down, it was known as a retirement capital of the country. And not so much now, but there are still a lot of seniors that have worked up north or in other areas that have moved. You know, they moved down to retire because of the no income taxes down here and also the no estate taxes. Uh, there are no estate taxes in Florida, which is, uh, opposed to some of the other states. So it's a great place to live, it's a great place to, uh, be and certainly, uh, for seniors it's a little bit easier for them. Speaker 2 00:03:15 You know, 1, 1, 1 of the common things, whether Arizona, you and I share that, right, Arizona, although my heat, I would gladly exchange. There's a lot of times I wanna exchange my heat with you with that. There's only so many over one 10 days we can really take in the valley. I'm honestly good to 110, but man over that, it just even gets a army guy like me. Um, you know, but, but even if, if those, if people aren't still in that flocking ward's, just seniors or the difference, uh, or, or, or totally senior centric as more people go into your state, I think one thing we do see around the country is that separation. The fact that that, um, you know, there generally we see older people settle down on the south where it's warmer, it's easier to get along. As I start getting older, I do, that's one thing I probably like to heat for. It's easier for me to move around Speaker 4 00:04:05 And don't say that Tony, don't say that <laugh>, Speaker 2 00:04:09 I've just an honest, but, but that distance causes, uh, causes a lot of, of, um, it causes, uh, sometimes panic, fear, anxiety, You're not sure. You don't get a handle on it. Surprises pop up and debt is, I I, I mean, I, it's already hard enough. It's something that is difficult in marriages and families in the first place, but if you're separated from your parents and they live in a different state, uh, then, then where you're hammering it out, maybe you're still up in Jersey and working through your, your day off of that, man, money can not only get away from you, but if that happens to your parent's situation, um, you know, you get a lot of anxiety about it. I guess I might kick off with a funny question. I mean, we see in here a lot of debt debt's a conversation sometimes, and I won't get too far into public policy, but does debt matter? Why does debt matter? Uh, Speaker 4 00:05:04 Debt does, that certainly matters, and it causes all sorts of stresses. It could cause you stress when you're young and in debt because you don't know how to pay your bills. It causes family problems and family issues, fighting divorces, Uh, it causes physical health issues. It causes mental health issues. Debt is a serious pl uh, problem regardless of what cycle of life you're in. Certainly with seniors, seniors in debt is very scary because when I first started, uh, in the debt relief business, seniors, they, that was still the depression generation. What do you mean? I'm in debt? I have to take care of these bills. I can't retire until I have all my debts paid off. Well, now you're seeing people in their sixties retiring with debt and basically their information, their, their, their income is derived from either retirement benefits or social security. So it is incredibly challenging to retire with debt and get off, uh, the treadmill of debt if you don't have the funding. Speaker 2 00:06:19 That is fascinating. I don't think, I, I don't actually think I've, I've heard anybody ever bring that to light. Um, so clearly that movement and retiring with debt from, from satisfying debt before you go out, but actually making debt a part of our retired lifestyle has kind of feels like you're playing with matches at some point in time, especially if you're gonna be on a fixed income. Uh, Speaker 4 00:06:42 Never before have we seen seniors coming to us in the, in the amounts that they're coming with debt. And it's a very tough thing. I mean, the fact of the matter is debt is the greatest non discriminator of all times. Doesn't care if you're blue, purple, green doesn't care if you're short, fat, doesn't matter, right? It affects everything it attaches on. And if you're paying 20% or more every single month, guess what? It's not going away anytime soon. Speaker 2 00:07:14 So is there generally a solution to most debt situations or are there some that are just not you? You know, is there something out there that you just really need to stay away from that thing in your experiences and seeing all this Speaker 4 00:07:29 Debt? My company's my prior company and certainly debt.com, we have counseled 10 million people over the course of the last 30 years. So we've seen it all. There's not one person that we can't help. We throw up our hands. Not one, never has been, never will be. We will help anybody. And I'm not just saying us. There's a solution for everything. Sometimes people call our offices and they just need some, a friendly voice and, and need some guidance to tell 'em how to get outta debt. Some need education, some need counseling, some need what's called a debt management plan where we basically negotiate with the creditors and try to get them, uh, get them outta debt in a reasonable amount of time. Sometimes it's a little harsher and we ha offer a debt settlement program where you're paying pennies on the dollar. But there are some drawbacks on that. Speaker 4 00:08:24 Sometimes bankruptcy, which we try to avoid at all costs. People come to us with being behind on their houses, and certainly it's our job to keep them in their houses. Uh, certainly people have medical bills. Um, those are a lot easier than you would think because the hospitals don't wanna sit there and sue people. They're a community based, uh, uh, group, and they don't want the reputation that they're suing people for tens of thousands of dollars. So, sure, it's easy to get outta debt. What you have to do is want to get outta debt and realize the first step is getting out, recognizing that there's a tr there's a problem picking up the phone and asking for help. And as humans, and, and certainly we're rough, tough guys, right, Tony? Yeah. We don't wanna ask for help, we'll just do it ourself. Well, this is a completely separate thing. Nobody taught us about finances when we were growing up in school. We kind of learned it on our own, and certainly we need to continue to learn, but sometimes learning entails going to an expert and understanding how, what is my path out of debt? I heard Speaker 2 00:09:42 What, Speaker 4 00:09:43 I heard a great quote today, and it said, you can never beat a guy that never gives up. And you said it, and it's a great quote. I think it was by Babe Ruth, if I'm not mistaken. Mm-hmm. <affirmative> and that quote. So you can't give up, you can't fall down, you can't fall back if you do just keep swinging. And in order to beat debt, you gotta keep swinging at it. Speaker 2 00:10:06 Yeah. I, I I I like that a lot. And I think you, the context that you set of life is hard enough <laugh> when, uh, debt matters because of the complexities that it adds on top of all of that, um, just becomes that weight. And so it's, I think it really is natural to think that the solution's gonna be a structured solution if you're not able to get there, having somebody from the outside be able to just simply restructure, uh, what's gonna happen so that you can start working your way out of that. That's a great way to start transitioning out of that fear and that anxiety and moving to a little bit of logic there. So I, that I do love. What I'd like to do is, we're gonna take our first break here, but when we come back from the break, I'd like to talk about how to approach some of those conversations with the families. What, what are the dynamics that are involved when, um, you have to start talking money with your parents? And, and I know you've got some personal experiences too to all of that. So let's, uh, we'll throw this out to our sponsors. Speaker 5 00:11:04 Hey guys, uh, this is Tony at the Parent Projects podcast, and if you are powered by Coffee the way that I'm powered by coffee, I think you'll appreciate knowing a way that you can help the last lost and least of us that didn't have a great transition. You see, The Refuge Coffee Company is a social enterprise operated by Catholic charities of central and Northern Arizona, where they use this coffee and this business model to help homeless veterans at the Mana House transitional community get back on their feet, help a veteran turn a handout into a hand up by giving them the opportunity to earn your business. Purchase coffee [email protected] That's the refuge az.com. If you order six or more bags, shipping will be free. And if you tell 'em that parent project sent you, I'm gonna send you Speaker 2 00:11:52 A travel coffee mug. Thank you again, and let's get back to the show. Welcome back, everybody with Howard Warkin today of debt.com. And, uh, you, you know, Howard, we have a, uh, a saying in the Army we would kick off a story with, So there we were in the whole room, so there we were, right? Uh, especially if it's gonna be an epic one, having a conversation about money, Uh, man, it stinks. It, it's hard. It's hard at marriage, it's hard with your kids off of that. You gotta have it with somebody who sees you constantly as that perpetual five year old that they had to take care of. So there we were, right? Like, how did the, you you had to face this at some point in time, and you were pretty young when, when you had to start facing, uh, a conversation like this, if I remember right. Um, how, how would you do? Speaker 4 00:12:45 Surely I, my father passed away when I was a kid, and my mom raised me all throughout my years. And, you know, when she got older, frankly, the money ran out and I had to try to take, insert my influence. But unfortunately, when you do that, parents often think of you, They don't see you as an adult, certainly don't see you as an accomplished adult, although they like telling their friends how great you've become <laugh>. But, uh, when it's you and you're, you're talking to mom or dad, they see you as a child. Speaker 2 00:13:23 And, but Howard, you are, you, you were like a cpa, right? You're, you're an accountant at that point in Speaker 4 00:13:29 Time. I am a cpa. I'm also a certified credit counselor. I've written two books. Uh, one, did you know that that did quite well, uh, in the sales area. Um, but I will tell you that it didn't matter. I was still a child and they didn't want to hear it. But everybody, uh, uh, affects it. Whether you're dealing with your children who are 18, who have never gotten a credit card, they think they know everything, and, or you're dealing with your spouse who, Oh, I'm the spouse. I, I know everything about credit cards. And you know what? It's, it's all psychology, Tony. Yeah. I mean, people need to understand that you have to af approach people differently, certainly in the cycle of life and, and never give up and keep pushing it. But you don't have to be overbearing. You maybe mention it, plant the seed, come back a couple weeks later, plant another seed, and then start to slowly talk to your parents about what's going on. I think a great first step is looking at, you know, what are the legal documents? Yeah. Is your will in order? Who's your, who's your beneficiaries? Um, who's, who's gonna take care of you? Who's gonna make major decisions for you if you are incapacitated, start looking there, make sure everything's together. Get the next step is get a list of major contacts, meaning who's your doctor? Who do you, did you buy funeral plots? Who's your pre pre priest? Or, or what church do you belong to? Whatever the case may be. Speaker 2 00:15:16 Yeah. Speaker 4 00:15:17 You know, go through and understand what am I facing if you're not here and who is facing it? Who's your executor? And, and give them a copy of your will so you have that and understand where, where's the money. That's the next step. Let's start to pitch in and look and copy me today. All statements are electronic. So you can copy the, the person that's gonna be handling your, your finances on they're financial statements, and certainly get copies of your bank statements and, and start to look at them as the child to make sure that mom or dad is not spending money recklessly or giving it away to somebody who probably doesn't deserve it. So make sure that you, you eyeball those statements every month, then go through and that way you have a very, very strong, uh, understanding of the finances, But to get to that point takes a lot of time, and it takes a lot of patience. Speaker 2 00:16:26 Well, and I, and I really like the consultive approach that, that you hint at with that, that that gives you an ability to, to help them get organized. You obviously, that that's the instate. They're going to have to reorganize things in order to get out of the problem that they're in. Um, and if you're not an accountant and you're not a cpa, um, you, you might not be able to know exactly what to do when you get there. But what you can do is get that information together the same way that you pull everything together for someone that might help you with your taxes at the end of the year. And, and that can be much less, It could be much less obtrusive. It could be, um, you, you might have to pace out that conversation. It might not be a sit down with them in a bruiser, like five hour session of pulling everything out the pen and paper, but breaking that up, um, you know, no, doesn't mean no, if a conversation stops and they don't want to discuss it or work through it because you know, they're seeing you as, as just, you know, as, as, as little Tony at that point in time, um, then you might have to break contact and come back at that conversation maybe from a, from a slightly different angle. Speaker 2 00:17:30 Like, Hey, mom, if you were, if you, if you went in the hospital today, um, what would you, and you were gonna ask me to bring you stuff, where am I gonna find that stuff to bring to you? Like, where, where do I need to look? Have you put that in one place when I was, Speaker 4 00:17:45 Who's your lawyer? That's, you broke your will? I mean, you know, unfortunately, we just recently had a passing of a, of a family member and my wife is the executor. Well, she never got a copy of the will, uh, you know, not that I knew, and it was just changed like the week before she passed. But, so there was no time, and unfortunately now we're going around trying to find all this, right? So we had no idea. And now we're running around trying to find all this information out, which is very challenging sometimes, especially if on the other side, not only do you have to fight, uh, uh, the the mom, but maybe mom is remarried and dad stepdad doesn't wanna share that information. Speaker 2 00:18:38 <laugh>, Right, Right. Speaker 4 00:18:39 You also have those challenges. It's interesting to see the dynamics that happen in, uh, families. And certainly when you're dealing with this, you need to take a consultative approach and be there. In my wife's case, she didn't even know she was an executor because her sister never told her that she was the executor, and all of a sudden she's, it's thrown in her lap and she has to scramble a little bit. So make sure that those decisions are verbalized beforehand. Speaker 2 00:19:16 Well, and, and that is one in the process and our senior moves techniques. Um, one of the earlier processes is if you're gonna do a relocation, that's an earlier task before you start packing everything up, find, it's a great opportunity to do it. It's a, it's a great icebreaker, if you will, to prepare for the move in the front side because it tends, just, like you said, it tends to open up other conversations like, Hey, who's your attorney? Where's your will? You don't have a will? Oh, that's good. We can put that up. You know, as, as we land, we know that these are additional things we can walk through and start bringing people through to, to come in and help, you Speaker 4 00:19:51 Know, speak scary when people move, say they move from different states, you have to redo your will to make sure it's in conformity with that state's laws. Speaker 2 00:20:01 Completely, completely. The great, really, really, uh, that's, that's a great topic. Okay. So, uh, that is, that is the benefit too, of bringing in those, those experts and those people sometimes that outside perspective to remind you, um, of that kind of stuff. You know, I, I do wanna, I actually wanna make a plug for you here. So as, as we head out into the second into the second break here, I'd like to highlight debt.com and show a little bit of what you guys do. So Speaker 4 00:20:31 I appreciate any plug, so thank you, Speaker 2 00:20:34 <laugh>. Ok, well, let's, I'm gonna Speaker 4 00:20:36 Out there Speaker 2 00:20:37 And let's see up front, and then we'll come back and wrap up our conversation. Speaker 4 00:20:41 Terrific. Speaker 6 00:20:42 If you feel like you're fighting a losing battle with debt, you need an ally, someone who can help you overcome the challenges of minimum payments and high interest rates that can make it impossible to gain ground. The debt.com team is here to give you the support that you need. We'll help you connect with the right person to overcome debt. We'll help you find a program that works for your budget and your goals. You can get outta debt faster with the right support. Visit debt.com/vicki today, Speaker 2 00:21:13 Tonys with parent projects. I've got Howard Dev working with us chairman of debt.com, uh, CPA author, and really, uh, a true servant who has been out there for 30 years, um, working with families to help them understand the impacts of debt, to get through the struggles of debt and ultimately free themselves of the pressures of debt. So, and I appreciate having you. Thanks again for joining us Speaker 4 00:21:37 Today. Thank you for having me. It's my pleasure. Speaker 2 00:21:39 So you, we, we've had this opportunity to understand, you know, the debt does matter. It's got an impact in that conversation. It's a hard conversation in a parent project because I'm still Tony baloney. Uh, and we, we've got these other things that we have to work through, regardless of what you may have accomplished in life or done or what your professional expertise might be. Those are just real hiccups to it. You know, one of the other complexities is often if you have, uh, siblings and, and other family members, lots of hands in the pot that come into to organizing those thoughts and those processes and, and where they go. Um, and, and I know some will utilize, some families can get through this. Sometimes everybody will bend a knee, like you said, you, you're wiping an executor of a will and everybody will bend to work to that. There are other times typically before we goes where families might not be able to do that, and it's just, it can add to the chaos. Um, are there tools, online technology, there's some cool stuff that's out there, things that you can think of that might help a family get on one sheet of the music or get, Well, Speaker 4 00:22:43 Certainly you mentioned, uh, mint.com as a great service, which tracks all your financial finances, uh, using outside tools. There's also on debt.com, there's tremendous products on debt.com, educationally speaking, meaning we have budgets, family budgets, and regardless if it's your parents or it's you, or if it's your kids, whatever the, the case, do a budget go through. And I know it's not the most interesting thing to do, but it's a necessary thing to do. You know, we don't take vitamins every day because we want to, we take 'em to prevent problems. Well think about doing a budget once a month and see how you compare it to the actual expenses. But certainly even your parents who likely are on fixed income, everything needs to to work out. Yeah. What I see constantly now is those people that retire with debt, uh, and, and unfortunately they don't have the income. So what are they using? They're using the credit cards again and keep charging even though they don't have the income to pay them off. Yeah. So it's very challenging when your parents are continually use financial products to, to pay basic expense and subsidize their living expenses with the intention, whether it's a true intention or just it's the reality that they're never gonna be able to pay that bill off Speaker 2 00:24:18 On the road. And therein that this psychology of when that moment drops and it happens differently. But Tim, Speaker 4 00:24:25 A lot of people hit a wall, Tony. Yeah. I mean, sometimes it's like I'm getting collection calls from the credit card company, sometimes I'm behind on my mortgage, sometimes this medical bill, they're telling me they're gonna sue me. Things, all sorts of things can happen. Uh, you know, you just have to convince the parent the target, for lack of a better word, the target to give up some control and let you help. The problem is a lot of people, we've never been, uh, trained Yeah. In, in schools. There's no education for how to handle personal finances unless you go out and seek it. Yeah. And on debt.com, there's certainly information on how to address financial challenges and what you should look for. So it may be the, the child needs to go through and educate themselves so they have an expertise, a base, a basis to explain to the parent, this is what has to happen. So go through, do the work, educate yourself on debt, and then go and make sure that your parents are in great shape or get them in great shape. Speaker 2 00:25:45 Yeah, There are, and there are some great tips, uh, for those of our, our, our members that, that are watching, and for others that come across this on our, our apparent projects.com. We, we've got a whole great series of becoming a financial caretaker together by the Consumer Financial Protection Bureau. Uh, and we, we work at conjunction with them and have a, a phenomenal series, uh, of, um, of what to be thinking about, questions to ask yourself, because it, it is that, that might also be a hard, a hard truth that a family member has to come to, is you might have to take stock in your own situation and say, I'm not in a position yet to advise against this. I, I, I might need to learn a couple of things to understand what I'm walking into. And that's an admirable position to, to begin with. Uh, I think when it comes down, one of the, it, it really will come back to, uh, not taking no for an answer or stopping at that though, that it may mean that you gotta work on you to get into the position to help them. But that consistent theme that I really do see is there's a solution out there for everybody, but knowledge Speaker 4 00:26:48 Is power, Knowledge is power, and if you have the knowledge, you can help make things better. You also have to be careful. And one thing I need to warn people about is we seeing an awful lot of caretakers Yeah. Speaker 4 00:27:04 Uh, abco with the parents, with elders funds, and we gotta be careful not to trust the person that unfortunately you're entrusting your, your parent to. And certainly, yeah, these carers aren't the most well paid people out there. They may be making $10 an hour, but may be spending a lot more than that, and they need to make ends meet, and they may take advantage of, of the people that they're wa they're supposedly watching over. So you gotta be cognizant of that. Certainly going through and getting copies of, uh, bank statements to see what's going on or hook up, uh, uh, hook up your computer to see, get the statements, get financial records, and certainly put the, uh, parents on, uh, automatic payments for utilities and rent and all that stuff. But also, I want to take, spend a few seconds and talk about long term care. What are the plans you need to understand what happens if you're have to go to a nursing home? How do I pay for getting an attendant to come in and help you? Or if you have to go to a, a, a, a long term care rehabilitation center. Yeah. Which one do I go to? Do I have insurance coverage to cover the costs? Because that could be 20,000 a month if Medicaid or Medicare doesn't pay for it. So you gotta be very careful and understand that in addition to all the other stuff I've talked about. Speaker 2 00:28:42 Yeah. Yeah. Tho those are in, in, and where our, this is where we kinda learned from our experiences, right? You, if, if you're in one of these challenges, it would behoove you to not pass the same thing down to your kids. This is one thing you don't wanna give 'em. I mean, you, you, what they want is your money, your name, your titles, right? They want all that. They don't want your dad. Um, and, and at the end when things get difficult, um, planning to be able to handle the finances without relying on a credit card that just kicks it down the road, or relying on debt to kick it down the road, um, that, that it, it really is important. So spending time. Yeah. Speaker 4 00:29:23 The good news is debt doesn't transfer to your beneficiaries. Yeah. So if there is an estate, that debt goes against what's in the estate. So if you owe $10,000 to, uh, Citibank for a credit card, guess what? If the estate has 10,000, great. It gets paid. If it doesn't, that debt unfortunately dies with the, uh, person, so it goes away. So that is a good thing. However, if you're sitting there taking out mortgages against your own or reverse mortgages against your home at this age, uh, that debt is certainly, uh, gonna result in, uh, your, your beneficiaries getting less. Yeah. Uh, of what than what maybe they expected. Speaker 2 00:30:15 Yeah. Well, Howard, I, I, again, I just sincerely appreciate you opening up with us and tackling a debt and, and that impact against it and arm in some, some of our members and, and families out there with what they can do. Not to give up, not take no for an answer, how to keep moving. I appreciate you and everything you do do in your life and your career as well. God bless you, Speaker 4 00:30:34 Tony. You're a good man, and God bless you and your, and your viewership. Thank you so Speaker 2 00:30:39 Much. Speaker 4 00:30:39 Be well. Speaker 2 00:30:40 You too. Speaker 7 00:31:07 Well, that's it for team this week, and thanks for joining us. If you enjoy the content, remember to subscribe and to share this episode on the app that you're using right now. Your reviews and your comments, they really help us expand our reach as well as our perspectives. So if you have time, also drop us a note. Let us know how we're doing for tips and tools to clarify your parent project, simplify communication with your stakeholders, and verify the professionals that you choose. You can find us on YouTube, follow us on Instagram and Facebook. Thanks again for trusting us. Until our next episode, behold and be held. Speaker 1 00:31:40 Thank you for listening to this Parent Project's podcast production. To access our show notes, resources, or forums, join us on your favorite social media platform or go to parent projects.com. This show is for entertainment purposes only. Before making any decisions, consult a professional. This show is copyrighted by Family Media and Technology Group Incorporated and Parent projects, llc. 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