I opened the mail Saturday evening to find a letter from a collections agency. My immediate reaction was anger, then fear, and nausea. What?! How did this happen? What bill didn’t I pay? Is this going to wreck my credit? Would I have a collections listed on my credit report for the next 7 years?
I tore it open to find details of the collections: $39 for unreturned equipment for Spectrum from my move from NC to TX. Wait a minute, I haven’t received any bills from Spectrum and when I checked my online account, it showed a $0 balance. I was confused.
To my surprise, the collections company isn’t open on Sundays so I had to patiently wait until Monday morning to call and get details. Of course, all sorts of awful things are running through my head and genuinely felt sick all day.
When I called the collections company Monday morning, they were very polite and explained to me that my balance at Spectrum shows $0 because the debt moved to the collections agency. She couldn’t explain why they never sent me a bill though. She also clarified that nothing had been reported to the credit bureaus yet and if I could return the modem the whole thing would go away. Turns out we left the modem because we couldn’t disconnect it without ripping out the wall. I thought I told Spectrum about it but turns out I completely forgot about it in the turmoil of moving. I paid the $39, made note of the confirmation number and hung up, quite relieved.
I was amazed at my reaction to the letter. It was emotional and physical and it stayed with me until the situation was resolved. I felt bad that I had missed something, I felt angry that I hadn’t received a bill, I felt anxious about the possible long term effect on my credit, and I felt genuinely nauseated about the entire situation and had a headache for about 16 hours. This is financial stress. The physical and emotional reaction to a bad financial situation that takes a toll on your health.
After dealing with my mini crisis, what struck me most is how minor my incident was and how major my reaction was. There are many people who deal with collections every day, and for much larger amounts than $39. I tried to honestly imagine the stress level of dealing with daily phone calls from collectors or the dread of seeing those collection letters in the mail. It must be absolutely crushing.
What should you do if you’re in this situation so you can deal with it better than I did?
Know your rights. You do have protection under the Fair Debt Collection Practices Act (FDCPA) which protects from abusive, harassing, or unfair debt collection practices. Collectors can’t call you before 8am or after 9pm, they can’t lie about how much you owe, they can’t threaten you with arrest and they can’t tell anyone that you owe money. You can read more about consumer rights and best ways to deal with debt collection at THIS LINK.
Get help. Make a plan to deal with the debt. You’ll need to take an honest look at your finances, get on a budget, stop unnecessary spending, and create a debt reduction plan. Let Your Money Line help you with this. It’s what we do!
Take care of yourself. Knowing your rights and having a plan will minimize a great deal of stress but you need to make sure you take care of your emotional, physical, and mental health too. Creating positive habits of exercise and eating healthy will help get you through this stressful time. Your good habits can be as easy as going for walks, meditating, cooking healthy food at home instead of eating and avoiding unhealthy coping behaviors like overeating or alcohol misuse.
I hope you never receive a collections letter, but if you do, breathe, get the details, know your rights, get help and have a plan.
Damian is the lead Financial Concierge on Your Money Line, the financial help line serving all Pete the Planner® Financial Wellness clients. Damian is a CERTIFIED FINANCIAL PLANNER™ professional and loves answering your money questions. Despite sharing a last name and sense of humor, Damian and Pete are not related.