While some of those counselors go home happy to be able to leave painful money issues at the office, others live with the memory of their own financial mistakes. A couple of weeks ago, some them shared their own tales of personal finance gone wrong: But there were plenty more stories where those came from.
Today, we bring you five more counselors sharing their personal stories of financial hardship and how they worked through it. For privacy, we're protecting their identities.
Credit Card Balance Mounted for this Credit Counselor
"I can definitely relate to clients who used credit cards to supplement their income when they or their spouse was unemployed, since we did that about 15 years ago. I was working as a credit counselor at the time, but my husband was unemployed and going to college under a displaced workers retraining program. He received unemployment compensation, but our budget was still off about $500 per month. So, like many others, we used credit cards to make up the shortfall for just over one-and-a-half years."
"I was really nervous about the rising debt and how soon he would find a decent paying job. Luckily, he found one about two months after he completed the program, because that's when his unemployment also ran out. A few months after he got the job we took out a second mortgage to pay off $15,000 in total credit card debt, reducing our interest to 9.9%. That loan was paid off about four years ago."
Student Loans + Credit Card Debt = Near Drowning
"I racked up $69,000 in student loans and $9,000 in credit card debt on three cards at 13 percent to 18 percent interest, living the life of credit card spending starting in my sophomore year. I was drowning in debt, so I asked the credit card companies to lower my interest rate and one lowered it by 5 percent. I was able to get a teaser rate of 0 percent on a different card. I stopped using my credit cards, put as much debt as I could on the 0 percent card and paid more than the minimum every month. I put myself on a strict budget, writing down every dollar I spent and subtracting it from my checkbook balance so I could see what I actually spent each month."
"When I was young and stupid, I had over $20,000 in credit card debt and a subprime home loan. I made a plan and stuck to it and it took me a few years to pay the debt off. I also got a home equity line of credit to consolidate the debt and reduce the interest rates, but that was paid off when we sold our first house. Best decision ever."
Debt Crisis Follows Long-term Unemployment
"I was unemployed and underemployed for the better part of three years, and used my credit cards liberally for expenses so I could use the income from unemployment benefits and part-time jobs to pay my mortgage. A month before I became reemployed, the car I owned blew its head gasket and was beyond repair, so I also needed to buy a car. All the payments started to stress my budget."
"I took several of the credit card balances, about $10,000, and restructured them as a home equity loan so I could write off the interest as mortgage interest. I sold some of my stock to pay off the car. Today there is very little credit card debt to pay monthly, and I can increase the home equity loan payment amount to pay it off ahead of schedule. Refinancing my first mortgage into a 3 percent loan gave me extra money in the monthly budget to start remodeling the house -- with cash."
Read the Fine Print
"When I graduated from grad school, I wasn't an enlightened financial counselor who knew to read the fine print. Smaller payments to consolidate my student loan debt, sure! Five years and a couple jobs later, I had enough income to try to get it paid down in less than the standard 10 years. Then I realized I was on a 20-year consolidation plan and there was absolutely no way to pay down the principal without paying the full $30,000 balance. Any extra funds are always applied to the next payment and everything is reamortized rather than completely going to principal. (Believe me, my tenacious and penny-pinching post-enlightened counselor self has tried including various appeals, all to no avail since it's "hardcoded" into the loan documents.) The interest rate is good, so I didn't want to refinance."
"I signed up for automatic withdrawal payments to get a lower interest rate, but I don't wait for the automatic payment, which continues to be paid even though I make extra payments every month. That way, I'm taking advantage of the lower rate but paying more than the minimum and getting it paid down faster. I will have it paid off in just under 15 years total at the current rate. Now, when I do presentations, I use that example as a reason to be careful about your terms for student loans and car loans, and to always do the math and read the fine print!"
If there's one thing that these stories make clear, it's this: Hard financial times can be found on both sides of the credit counselors' desks, but the lessons that they teach are universal: Stick to a spending plan, pay off your debt as fast as you can, and save as much as possible so you don't need to borrow to handle an emergency.
Michele Lerner is a contributing writer for The Motley Fool.