An increasing number of people within our community are struggling to manage their financial affairs. The causes for the problem are numerous. But the daunting combination of an unending pandemic, changing job market, volatile economy, rising inflation, social uncertainty and the challenging cost of Jewish life make it difficult for many to cope. In addition, very few of us receive proper training or guidance in the management of our financial affairs.
For those with good jobs and sufficient incomes, more modest financial mistakes get lost in the shuffle. And when more serious issues arise, those who can afford it turn to professionals for assistance. But what about people with lower-paying jobs, no job at all, retirees on fixed incomes or others who can’t afford to pay for the assistance they need to navigate credit problems, debt collection efforts or other financial issues?
We are fortunate to have within our community very generous organizations that offer loans, grants or other direct financial assistance to those in need. There is no underestimating the value of such assistance, and the providers of it are doing impressive work. Oftentimes, the added boost of a cash infusion helps solve the problem. But not always. In fact, sometimes the cash infusion only helps solve an immediate need, but does nothing to address the more complex financial issues that underlie it.
According to Upsolve, a financial education and civil rights nonprofit, one of the biggest challenges to those struggling financially develops when they are sued by debt collection agencies and others and don’t know what to do in response. They cannot afford counsel and don’t understand the court process. When they fail to respond to the lawsuit and lose their case by default, their financial problems snowball as their credit is destroyed and they are plunged further into debt. Similar difficulties develop for those who struggle with banks, credit card companies and “easy money” lenders, and find themselves victims of “terms and conditions” they never read or understood, but signed and agreed to (as we all do) in order to access the opportunity.
Upsolve wants to deputize its non-lawyer volunteers to help debt collection defendant clients navigate the court process and otherwise help them work through their issues. But in many jurisdictions, the provision of guidance for the response to a lawsuit is considered the practice of law and it is forbidden to practice law without a license. So Upsolve recently sued the New York State attorney general, seeking an order allowing non-lawyers to provide such guidance. The issues presented are interesting, and we await the court ruling.
The Upsolve case helps focus on the need for credit guidance, financial management education and a whole host of financial training and instruction that is needed in order to help avoid the lawsuits, the debilitating judgments and years-long damage to credit rating that could result from recurring financial mistakes. Some of that is provided by our existing social service agencies — although mostly focused on financial relief. We encourage a more robust and farther-reaching effort.