Mississippi Resident Debt Relief

The most recent ranking of states by U.S. News and World Report was not kind to Mississippi.

Again.

The state ranks 49^th in the nation in terms of best places to live, and ranks 50^th in health care, 43^rd in education, 49^th in economy, and 44^th in opportunity.

This seems like an ongoing struggle for the Magnolia State, which two years ago ranked 50^th and last in state wealth and had almost 20% of the population living in poverty. At the same time student loan debt was increasing by the ninth fastest rate in the country.

The combination of debt and low income makes for a tough start for young people recently graduated, and coming off a year of COVID-19.

State legislators, though, were proud when they sat down to debate the state’s $6 billion budget in March of 2021.

“We’re in great financial shape,” House Speaker Philip Gunn said. His reason: The state had about $173 million more to spend for fiscal year 2022 than it expected.

The state, though, is one of the most dependent on the federal government in the country, receiving $2.88 for every tax dollar paid, the fourth highest in the country. From 2015 through 2019 44.38% of Mississippi’s budget came from the federal government.

Debt Relief Options for Mississippi

Mississippi residents carry an average of $5,134 in credit card debt, 17% below the average national average of $6,194, but significant given U.S.News’ annual report on states puts the state’s median income is $24,519.

One way to deal with credit card debt is to find a nonprofit credit counseling agency that offers debt management plans. InCharge Debt Solutions could help Mississippi residents by heling them develop a debt management program.

This program lowers interest rates on credit cards, which reduces monthly payments to affordable levels. By opting into the plan, you can cut interest on your credit cards to as low as 8%, sometimes even lower.

There is no minimum credit score needed to apply, so credit history should not obstruct your opportunity at debt relief. If that program isn’t the appropriate solution, a certified credit counselor can offer other options. There is more than one solution to getting rid of credit card debt.

Among the options:

Debt Consolidation Loan – An option for those with good credit scores. Debt consolidation is a personal loan that borrowers can use to pay off debt. Ideally, the new loan has a much lower interest rate than what you pay on your credit cards. Consolidating unsecured debts can simplify the bill paying process and minimize the likelihood of suffering late fees.

Debt Settlement – A process that lets borrowers pay back less than they owe and is usually restricted to unsecured debts. Many debt settlement companies offer to reduce a borrower’s debt by up to 50%. However, the settlement process and negotiations can drag on for 2-3 years. In that time, late fees accrue and cut into savings. The debt settlement company will charge a fee for its services as well. Debt settlement is considered a severe negative on your credit report and stays there for seven years.

Bankruptcy – A last-resort option, but one that in that last-resort scenario should be considered because it could wipe out the debt. Bankruptcy will significantly drop the credit score for 7-to-10 years, which might make getting a home or car loan in that timeframe extremely difficult.

Mississippi Debt Resources

Mississippi is not a strong participant in federal aid programs.

In January of 2021, only 3,000 Mississippi families received help from the Temporary Assistance for Needy Families (TANF, or welfare) program – despite the fact the state received a grant from the government of $86.5 million. Mississippi Today reported that the state spent just $5 million of that money in 2019 on cash assistance; $27 million went to Child Protections Services and the remaining $47 million was spent on a variety expenditures.

In March, Mississippi raised the amount of money given to TANF recipients by $90 a month, to $236 for a family of two and $284 for a family of four.

That assistance leaves needs unmet. The state offers other programs that can help, but Mississippi requires self-sufficiency – which could mean holding a job, completing work search requirements, taking part in credit counseling, and budgeting or support counseling. Case managers work with those in need.

Among the programs the state offers:

Mortgage and foreclosure assistance through the federal government – Help as well as counseling is available from the state or local non-profit agency of Health and Urban Development (HUD).

Mississippi Certificate Program – A state program that, using mainly federal funds, can help low income families with day-care costs. Demand for this program is high, and could entail a waiting list.

The Emergency Food Assistance Program (TEFAP) – The state partners with the U.S. Department of  Agriculture to provide money for food and necessary purchases. Commodities are stored at the Twelve Baskets Food Bank in Biloxi and the Mississippi Food Network in Jackson.

State Health Insurance Assistance Program (SHIP) – Basically information and medical counseling for seniors about insurance and medical issues.

Higher Ed Legislative Plan (HELP) – This program helps cover the cost of college tuition for qualified students in need.

Mississippi Lifeline – Provides $15 per month on cell or home phone bills, and the waiving of service charges.

Private organizations – The Salvation Army and Legal Aid are two non-profits active in the state.

Mississippi free community clinics – Provides health care for those who qualify, and low cost medical and dental care to those who do not.

Mississippi Agency on Aging – Offers a variety of help, including health care and medical bill assistance.

Private help – Community agencies offer counseling and referral help with self-sufficiency programs and government help. Federal help is available through Section 8 via HUD. Food banks are available in several areas of the state.

Mississippi rental assistance – Local and non-profit agencies have resources that include money to pay for housing and rent in an emergency, help with security deposits, federal rent vouchers and homeless prevention services.

Utility bill assistance programs – Programs offered directly through utility companies that provide help during difficult financial times, or when facing a disconnection.

Mississippi Debt Statistics

Some of the most recent financial numbers for Mississippi include:

• In 2019, 19.6% of the population in Mississippi was living in poverty.
• In 2018, Mississippi’s GDP was 1/25^th that of California’s while being 1/13^th the size in population.
• Poverty is not a function of population, though. New Hampshire had the lowest poverty level in the nation at 4.9% with just less than half Mississippi’s population.
• Mississippi has the lowest life expectancy in the nation at 74.5 years.
• Federal and private student loan borrowers in the state owe an average of $33,182. That’s less than the national average, but had been increasing for the ten-year period from 2009-2019.
• About 400,000 individuals in the state have student loan debt, with an average monthly payment of $225.