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How to Recognize a Financially Abusive Relationship — And How to Get Out of It

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Domestic violence shatters a victim’s sense of physical and emotional safety, and financial abuse makes it even harder for victims to break free from the grip of their abuser.

Financial abuse is “using money and financial tools to exert control,” according to the National Network to End Domestic Violence. Abusers may give victims an allowance, harass them at work or ruin their credit by opening credit cards or borrowing money and refusing to pay it off.

An abusive partner limiting a victim’s ability to save money, find housing or develop financial independence makes financial abuse one of the main reasons victims decide to stay in or go back to abusive relationships, said Kimberlina Kavern, senior director of the Crime Victim Assistance Program at Safe Horizon, a New York-based nonprofit victim assistance organization.

And it is frighteningly common. According to the Centers for Disease Control and Prevention, one in four women and one in nine men have been the victim of intimate partner violence, which includes sexual and physical violence and stalking. In a 2008 study published in the journal Violence Against Women that included accounts from 103 survivors of domestic violence, 99% reported they had experienced financial abuse.

Here’s how to identify financial abuse in a relationship, and the steps to take to find safety.

How to recognize financial abuse

Financial abuse can happen alongside physical and other types of emotional abuse, including intimidation, isolation and coercion. “What’s backing that behavior up is the constant threat of actual physical or sexual violence,” said Kim Pentico, director of economic justice at the National Network to End Domestic Violence.

An abusive partner may engage in financial abuse in the following ways, according to Kavern, Pentico and Rosemary Estrada-Rade, director of digital services at the National Domestic Violence Hotline:

  • Stealing credit cards or cash
  • Taking out debt in the victim’s name, or forcing the victim to cosign on a loan
  • Hiding money
  • Forcing the victim to file fraudulent tax returns
  • Giving the victim an allowance
  • Demanding the victim hand over receipts for purchases
  • Limiting how much a victim can work or preventing them from working
  • Requiring the victim’s paycheck be deposited into the abuser’s account
  • Using the victim’s credit cards without permission
  • Harassing a victim at work or forcing them to be late, putting their job at risk
  • Refusing to work and forcing the victim to be the sole breadwinner
  • Withholding food, clothing, medication or other necessities
  • Buying items for themselves but not providing for the victim or children

“Financial abuse, like other abusive tactics, starts very subtly,” said Kavern. For instance, an abuser may offer to take care of the family’s finances to reduce the victim’s duties at home. “Over time, you see that the abuser is giving them less control, and it’s serving as a way to isolate the victim,” she said.

How to get out of a financially abusive relationship

Safely ending an abusive relationship requires making careful preparations that will protect you from the abuser.

“When you are leaving an abusive relationship, that’s when victims are in the most danger,” Kavern said. “You should have a good safety plan in place.”

That can include identifying where the abuser will be when you leave and how he or she might respond, as well as whether you’ll pursue an order of protection against them. You may also consider saving money in ways the abuser is unlikely to discover.

For instance, Pentico says survivors have brought coupons with them to the store, but instead of using them at the register, they asked the customer service desk for a refund on the difference between the regular and sale prices. It appeared on the receipt that all items were purchased at full price, but the victims put the cash refund in their own savings accounts. Here are other actions to take:

  • Pull your credit report for free from and note whether the abuser has opened any accounts in your name. If he or she has, you may have been a victim of identity theft. You can report it and receive a free, personalized recovery plan through the Federal Trade Commission’s website.
  • Also, if the abuser ran up unpaid debt on these accounts, which affected your credit score, you can consider disputing any negative marks on your credit report. Do so at each of the three major credit bureaus — Equifax, Experian and TransUnion — or contact the FTC for personalized advice on your situation.
  • Consider opening your own checking account, if you can do so safely, and getting a credit card in your name only. That will help you build your own credit history and develop financial independence.
  • If leaving your relationship results in financial hardship, resources like the Moving Ahead Curriculum, a five-part online program developed for survivors of domestic violence by the National Network to End Domestic Violence and the Allstate Foundation, can help you explore how to rebuild your finances.

The bottom line

You’re not alone as a victim of financial abuse. In a 2018 survey administered to domestic violence survivors who contacted the National Domestic Violence Hotline, 67% said they stayed in or returned to abusive relationships due to financial concerns.

If you’re struggling to free yourself from your abuser, there is a community of support available to assist you at any point. To get help:

  • Call 911 if you’re in immediate danger.
  • Contact the National Domestic Violence Hotline to talk to an advocate who can connect you with resources in your area and help form a plan to get out of the relationship safely. Experts are available 24/7 at 1-800-799-SAFE or via online chat.

A National Domestic Violence Hotline advocate can put you in touch with local agencies that provide support finding housing and getting public benefits. Each state also has its own organizations that offer resources to victims. There is hope and happiness on the other side of financial abuse; the first step is to ask for help.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Brianna McGurran
Brianna McGurran |

Brianna McGurran is a writer at MagnifyMoney. You can email Brianna here

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7 Debt Consolidation Myths

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

debt consolidation

Debt consolidation is a way to pay off existing debt with a new loan or line of credit. It could provide relief by turning multiple payments into one, streamlining what you owe and saving you money thanks to a lower interest rate or more time to repay.

Dispelling these 7 debt consolidation myths

In the right circumstances, debt consolidation can help get debt under control. But there are entities that offer the promise of debt consolidation yet don’t deliver — and even charge illegal fees in the process. Understand the following debt consolidation myths, and the pros and cons of the process, before pursuing it.

1. You can consolidate all types of debt together

There are many types of debt consolidation. A debt consolidation loan, for instance, is a personal loan that can be used to pay off multiple kinds of high-interest debt, such as credit cards and payday loans.

But it can’t be used to pay off federal student loans. There’s a separate process for that, called federal student loan consolidation. This option won’t reduce your interest rate, but it can give you more time to pay off your loans or qualify you for additional reduced-payment programs.

You can also consolidate credit card debt on its own using a balance transfer credit card, which moves high-interest debt across multiple cards to a single one. You’ll have as long as 21 months, depending on the card for which you qualify, to pay off the debt interest-free.

2. You need excellent credit to consolidate debt

Like other types of financial products, the higher your credit score, the more favorable terms you’ll get on debt consolidation loans and balance transfer credit cards.

But you can qualify for a debt consolidation loan with good, fair or even poor credit. Visit your local bank or credit union to check the options available there first. You may qualify for a lower interest rate if you have a long-standing relationship with the institution.

You can compare rates on debt consolidation loans through MagnifyMoney’s marketplace.

3. You have to pay to consolidate debt

If you qualify, you could get a balance transfer credit card with no transfer fees and no interest charges during the introductory period. Paying off your debt during that time means consolidating your debt fee-free.

But some cards do come with a balance transfer fee; consolidation loans may also have origination fees. Take these into account when considering whether to consolidate your debt or choose a different option, such as negotiating with your creditors yourself to lower interest rates.

Use caution if you interact with a company that charges to consolidate debt for you. Some companies charge fees to consolidate student loans, for instance, which is free to do directly through the government at The Federal Trade Commission (FTC) maintains a list of companies that it has banned from offering debt relief services.

It is illegal to charge a fee by phone before issuing a loan, according to the FTC. Familiarize yourself with the signs of an advance-fee loan scam.

4. Debt consolidation is always a scam

On the other hand, there are legitimate types of debt relief that may cost money.

Though not specifically a type of debt consolidation, debt management plans require working with a nonprofit credit counseling agency to simplify payments and potentially pay less on interest. You’ll make one payment to the credit counseling agency each month, which will then pay your creditors on your behalf. You’ll be charged a monthly fee and potentially an enrollment fee.

But you may find these fees are worthwhile to address your debt with the help of a reputable professional. A debt management plan requires making payments regularly and on time for the full length of the plan, which could take up to five years.

5. Debt consolidation will hurt your credit

Opening new accounts, such as a credit card or loan, may lead to a small drop in your credit score. An inquiry for a new credit card generally takes fewer than five points off a FICO Score, according to FICO. But opening multiple new accounts over a period will more dramatically affect your score.

Research your options in advance so that you apply for a balance transfer card or debt consolidation loan for which you’re likely to qualify. Once you get it, make payments on time, every time. Payment history accounts for the largest share of your credit score — 35%, according to FICO.

6. Consolidating debt is the only way to find relief

You may not have to apply for a new credit card or loan to get out from under your debt. Alternatives to debt consolidation include working directly with your creditors, who may be willing to lower your interest rate, waive late fees or give you a new monthly payment. You could also choose a debt management plan, which doesn’t require you to open a new line of credit.

If you can pay extra toward the debt, you can opt to pay off the smallest loan balance first, then put the equivalent of that monthly payment toward the next-smallest balance. This is the debt snowball method, and can help you gather wins on your way to debt freedom. Or you can pay the highest-interest loan first, called debt avalanche, which will save more money in the long run.

7. Pursuing debt consolidation is a cure-all

While debt consolidation can help you feel less overwhelmed in the short term, ending a reliance on credit cards — and preventing future debt — is a separate, and necessary, process.

Once you’ve chosen a debt consolidation method, audit your expenses and make a spending plan. Cancel subscriptions you no longer use and identify areas that need a closer look, such as how much you spend on meals out. You don’t need a complete overhaul of your budget, but a few key changes — such as cutting back on food delivery or reducing subscription services — can help you avoid creating more debt.

When debt consolidation works

Debt consolidation is a smart move when you qualify for a balance transfer credit card or loan that will lead to interest savings, as well as when you make payments on time for the duration.

Pause making purchases on the accounts you’re paying down. If you get a balance transfer credit card, make sure you fully pay off the debt during the card’s interest-free period. Divide your total debt by the number of months with the 0% interest rate and commit to sending that amount to the card each month.

Choose the right debt consolidation method for you

While debt consolidation myths abound, researching your options and relying on reputable sources of professional guidance will help you land on a strong strategy. Deciding to pay off debt is half the battle. The next step is to choose a debt consolidation method that will give you the best chance of success.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Brianna McGurran
Brianna McGurran |

Brianna McGurran is a writer at MagnifyMoney. You can email Brianna here

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How Does Credit Counseling Work?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

credit counseling

Credit counseling is a smart first stop for anyone interested in getting a better handle on their money. It can help you build a budget and improve your credit score, but it’s especially helpful for those struggling with debt.

Credit counseling 101: What you should know

Read on for an overview of credit counseling and when to pursue it.

9 Questions and Answers About Credit Counseling

A certified credit counselor works with you to understand the full picture of your finances and develop a plan. Credit counselors also offer debt management plans.

There are various costs:

  • Initial 1-hour consultation: Should be free

  • Enrollment fee: About $34

  • Monthly fee: About $24

Credit counseling is a good idea when you are:

  • Overwhelmed by debt and unsure how to address it

  • Interested in building a budget but don’t know where to start

  • Considering or have already filed for bankruptcy, at which point it may be required


It depends on the type of help you receive from a credit counselor

1 hour to 5 years


Eventually, yes


What is credit counseling?

Credit counselors provide financial education, such as budgeting advice and housing counseling, and they also help clients implement debt management plans to pay off debt. Debt management plans let those in debt make a single monthly payment to the counselor, who then pays creditors on the client’s behalf.

Credit counselors generally work for nonprofits, and are trained and certified by organizations, such as the National Association of Certified Credit Counselors and the National Foundation for Credit Counseling.

You can receive credit counseling over the phone, online or in person. Depending on your needs, you may speak to a credit counselor just once or twice, or sign up for an ongoing debt management plan. Before working with a credit counselor, ensure they are certified and receive confirmation of any fees in writing.

How much does it cost?

An initial consultation at a reputable credit counseling agency is free and generally lasts for one hour, said Thomas Nitzsche, a credit educator and spokesman at Money Management International, a nonprofit credit counseling organization in the Houston area. During that time, a counselor will review your finances and answer questions about how to manage debt, budget or meet financial goals.

Clients who feel overwhelmed by debt may choose to sign up for a debt management plan, during which you’ll pay the credit counseling agency a fixed amount every month. The agency will then pay your creditors, generally after negotiating lower interest rates or fees on your behalf.

A debt management plan can take up to five years, and you must make payments regularly until the plan is complete. At Money Management International, a debt management plan costs $34 to enroll and $24 a month on average, Nitzsche said. You can expect to pay around that much at other nonprofit credit counseling agencies.

When is it useful?

Most consumers access credit counseling when they’re seeking help to answer questions or overcome financial difficulties. It can be useful in the following situations:

  • When you need help addressing debt. During credit counseling, you can assess the situation, explore debt relief options and start a debt management plan if that’s best for you. About 10% of credit counseling clients at Money Management International choose to enter a debt management plan, Nitzsche said.
  • When you want to budget but don’t know how. It may be overwhelming to create a budget on your own or evaluate which expenses you can cut or negotiate. A credit counselor can examine your finances and offer solutions.
  • When you’re exploring bankruptcy. Whether to file for bankruptcy is a significant decision to make, and a credit counselor can help you compare it with other options. If you do file, you’re required to attend pre-bankruptcy counseling within six months.
  • When you have specific financial questions. Credit counseling agencies may also offer specific types of counseling, for those with questions about homeownership or student loan debt, for instance. If you’re ready to take the next step in these areas but are feeling stuck, credit counselors can steer you in the right direction.

Are there credit requirements?

You do not need a specific credit score to participate in credit counseling. Anyone can get help, whether your credit score is lower than you’d like or your score is strong and you’re exploring the best financial next steps to pursue.

Before agreeing to a debt management plan, some credit card companies or lenders may require proof that you can’t pay the debt unless you participate in the plan, Nitzsche said. They may also want to see that you earn enough money to make payments on the plan as agreed.

Can you continue using your accounts?

If you seek general advice from a credit counselor and follow their suggestions on your own, it’s up to you whether to continue using your accounts.

You’d be wise to discontinue using credit cards when you’re working on eliminating credit card debt, but you do not have to close your accounts. That could result in a lower credit score: You’ll have less available credit, thereby increasing the amount of debt you have relative to your credit limit.

When you sign up for a debt management plan, though, your credit counselor may require you to close credit accounts so that you do not add to your debt. You may decide that’s worth the effect on your credit in exchange for relief from debt. Also, making payments on time during and after the plan will have a positive impact on your score.

How long does it take?

The amount of time you spend working with a credit counselor depends on your needs. You may decide that a one-hour counseling session is enough to come up with a debt payoff plan.

Or, if you feel deeply overwhelmed by debt and opt for debt management, the plan could last up to five years. It could take less time if you can pay extra toward your debt, though, as a result of a pay raise or bonus, for instance. Clients at Money Management International complete their debt management plans in an average of four years, Nitzsche said.

Are there tax implications?

No. Debt settlement, a separate process that involves negotiating with creditors to pay less than you owe, may result in savings that are taxable as income. But when you work with a credit counselor on a debt management plan, you pay the full amount you owe, Nitzsche said — just at more favorable terms, such as at a lower interest rate or over a longer period. That means you do not have to pay tax on settled debt.

Will it affect your credit?

Merely signing up for credit counseling won’t negatively or positively affect your credit. But the outcomes of credit counseling can. Designing a budget that lets you pay bills on time can help protect your credit from the effects of missed payments.

A debt management plan may result in a dip to your score if you close credit accounts, but positive payment history from then on will improve it. On the flip side, a single missed payment to the credit counseling agency while on a debt management plan could put your good standing at risk with multiple creditors.

Is it guaranteed to work?

There is no guarantee that credit counseling will improve your finances. Once you’ve chosen a reputable counselor you trust, the success of the experience largely depends on your commitment to following their guidance. Taking their advice to keep to a budget, or making payments as agreed on a debt management plan, requires diligence and organization. But you’ll likely have a better shot at reaching your goals with a credit counselor in your corner than on your own.

Credit counseling isn’t your only option

You may decide to choose a more do-it-yourself version of debt relief. You can look into debt consolidation, which generally comes in two forms: interest-free balance transfer credit cards to get credit card debt under control, and personal loans.

Or you may try to bring the debt down on your own: You can call your creditors and ask if they’ll offer you a lower interest rate, for example, or waive late fees.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Brianna McGurran
Brianna McGurran |

Brianna McGurran is a writer at MagnifyMoney. You can email Brianna here

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