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Ask Dave

How Do We Handle Bill Collectors?

Stephanie says some of her and her husband's bills went into collection, and she refused to give them her checking account information. Dave says Stephanie is doing the right thing.

QUESTION: Stephanie in Indiana and her husband just had their first child. Some of their bills went into collection, and she refused to give them her checking account information. She’s being told she isn’t following their terms and conditions and will be penalized for that. Dave says Stephanie is doing the right thing.

ANSWER: If you’re not nice to me, you’ll get penalized by me not giving you money. You don’t get to tell me how I’m going to live my life and how I’m going to pay the bill. I’ll pay the bill, and we’ll do it as agreed, but you don’t get to set the terms.

You didn’t sign any agreement that said you had to give a draft to your checking account, so there are no terms and conditions. It would be like me walking up to you and saying, “Hey, here are some new terms and conditions. Give me the keys to your car.” I don’t get to set those kinds of terms and conditions. That’s called a unilateral agreement. In other words, it’s not an agreement.

That’s just collector talk. They’re just full of crap.

Here’s the thing: Ten thousand dollars makes your life a dream compared to where it is because you’d have no debt. That would be pretty dreamy. If I were your husband, I would deliver pizzas and make an extra $1,000 a month for the next 10 months and be debt-free. Instead of working 40 hours, I would work 60 or 80 hours, and you can make $1,000 a month delivering pizzas in tips alone. If you work four or five nights a week, you can probably make $1,500 a month.

That’s your issue here. Most of your problem is you’re living on income that is about half the national average. You’re struggling on the income side of the equation. For the short term, I would pick up part-time jobs to get my income up. Then the two of you both need to look at your career track and say, “Hey, what are we going to be doing five years from now that pays me not $15,000 a year but $50,000 a year? And what have I got to do to get there?” And start aiming at that. You’re not making much above minimum wage. I really want to see you guys have a long-term game plan to increase your income and a short-term game plan to increase your income, and that’ll get rid of these collectors faster than anything else because they’re really the symptom. The problem is your low income. That’s where you’re struggling.