Credit counseling helping millennial pay off $100,000 in debt: Here's how

HOUSTON - Houston ranks number one in the country for residents having the highest debt and being in financial distress, according to a new report from WalletHub.

Across the country, Millennials and young adults are struggling with debt the most.

How a Millennial is paying off $100,000 in debt

The backstory:

We caught up with a Millennial who is halfway through paying off $100,000 in debt and how credit counseling is helping him do it.  

Joshua Brechter, 29, is facing what 88% of Millennials are facing: debt.

"I don’t know. The debt just got so overwhelming, the late fees, trying to prioritize which one to pay $50 here, $50 next week," said Brechter.

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Brechter says it started after losing his job in the pandemic, and he had to rely on his credit cards.

"Then I did a consolidation loan. An amazing fresh start. Then the debt kept going because the pandemic kept going," he said.

It finally snowballed.

"Probably $100,000, $110,000, but now we’re down to like $45,000. Doing great!" he said.  

Brechter turned to Money Management International, a non-profit credit counseling agency, which negotiated with his credit card companies to give him much lower interest rates.

"It’s been fantastic. One of my credit card APRs was at 27%. Now it’s .001%," he said.

What we know:

MMI reports a 35% increase in people seeking credit counseling, as they wrestle with an 11% increase in housing costs, an 8% rise in unsecured debt, and a 7% increase in monthly expenses.

Texas residents seeking debt relief had an average of $30,000 in debt, according to MMI.

"Because of the economy, most people fall back on credit cards to pay for simple things like gas, groceries and food," said Sheri Williams with Money Management International.

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MMI helps its clients to set budgets and pay off their debt in under five years.

"What we do is discuss options to get out of debt, because there’s more than one option to get out of debt. We look at the income, budget, and credit report, then discuss the best option," Williams explained.

"It took all of my credit card payments and brought them down. So it allowed for more liquid income in my life," said Brechter.

What you can do:

Reputable credit counselors can be found through the National Foundation for Credit Counseling.