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Friday, December 1, 2023
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How to help loved ones deal with debt

Lauren Schwahn

AP – Juan Pinon, an electrical engineer in McAllen, Texas, struggled with credit card debt for years.

It wasn’t until he confided in his sister that he began to turn things around. “It just so happened that one day I opened up to my sister, and she confessed to me that she had debt issues and was able to get out through professional help,” Pinon said.

Getting a vetted referral to a non-profit credit counseling agency and encouragement from someone he trusted convinced him to take action. Pinon enrolled in the agency’s debt management program and paid off about USD50,000 in less than three years.

It’s difficult to watch people we care about struggle with debt. Debt can disrupt their financial and personal lives, as well as the lives of those around them.

As a close friend or family member, your influence can be powerful enough to spark change. How can you help others avoid falling further into debt, especially as the expensive holiday season inches closer?

Here’s what you can do to help a loved one deal with debt.

Unlike Pinon, people with debt won’t always raise the issue themselves. Bringing up someone else’s personal financial matters can feel like overstepping a boundary.

If you think it’s important to intervene, be strategic about setting the right tone.


The first step should be asking if they’re open to the conversation, said Kathryn Ellywicz, a former counsellor at GreenPath, a nonprofit credit counselling agency.

Giving them a choice may prevent them from feeling ambushed.

If they’re willing to discuss their debt situation, speak kindly and withhold judgment.

“A lot of times, our family members feel shame around financial debt. So it’s a conversation that needs to be entered into very carefully,” said an accredited financial counsellor Brandy Baxter.

“It needs to have a lot of grace, and it needs to be in an environment where the person feels relaxed.”

If you’ve been in a similar position, consider telling your loved one. Drawing on your own experience with debt and acknowledging the emotions involved can help come at it from an empathetic place.

“We can use ourselves as an example to say, ‘Hey, I was there, I understand. I’m not trying to put you on the spot. I myself went through this embarrassment. Please let me help you,'” Pinon said.


Your friend or family member might shut the conversation down.

That’s okay.

“Debt can be addictive, just like any other addiction. The person that’s in the cycle may not see anything wrong, and so they may not be ready for help,” Baxter said.

Ultimately, you have to accept that it’s their life and their decision. Let your friend or relative know you respect their choice and you’ll be ready to help if they change their mind.

Baxter said you can also use this as an opportunity to reset boundaries. If you’ve been providing financial support for them and no longer feel comfortable doing so, explain the circumstances and ask them to respect your decision in return.


If your loved one is ready to dig out of debt, help them take the next step. You can talk to them about the emotions that might be influencing their spending behaviour, explore different debt payoff methods or look over their expenses.

“Maybe you come together and say, ‘OK, here’s how I do my budget. Let’s work on how you do your budget. Or here’s how I’ve set up my spending plan. Let’s work on setting your spending plan,'” Baxter said.

But not everyone feels comfortable letting their friends and family dig into the nitty-gritty details of their financial lives.

Besides, not all of us have the necessary expertise to take a do-it-yourself approach. “Of course, there’s always the professionals available to help,” Ellywicz said.

“Sometimes, even just giving a referral is a lot of help to a family member,” she added.

Come prepared with a list of trustworthy resources, such as online tools, non-profit organisations and financial counsellors. (Non-profits, such as credit counselling agencies, typically offer lower-cost or free services and meet certification requirements for quality and ethical standards.) Then, pass along your recommendations.


As a holiday season approaches, your loved one may feel increased pressure to splurge.

Do your part to not add to their existing debt and discuss keeping plans simple.

Baxter suggested looking for alternatives to gift-giving that will “lessen the financial burden”, such as volunteering to host a special dinner or exchanging gift cards with a set dollar amount.

Keep the momentum going and check in with them throughout the year. Debt payoff is a journey, and the journey may be a little easier with you by their side.


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