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Veterans facing financial challenges, particularly credit card debt, often wonder what resources the Department of Veterans Affairs (VA) offers to help them regain financial stability. While the VA doesn’t directly pay off veterans’ credit card debts, it does provide a range of services and programs that can help veterans address financial issues and improve their overall financial well-being.
If you’re a veteran struggling with credit card debt, first: thank you for your service. Secondly, here are some resources at your disposal that may be able to help…
Financial counseling services
The VA partners with accredited financial counselors who can provide personalized guidance to veterans struggling with debt. These services include:
- One-on-one financial counseling sessions.
- Budget creation and management strategies.
- Debt reduction planning.
- Credit score improvement advice.
Veterans can access these services through their local VA facility or through partner organizations like the Association for Financial Counseling & Planning Education (AFCPE), which offers free financial counseling to veterans and their families.
VA disability compensation and protected income
For veterans with service-connected disabilities, VA disability compensation provides tax-free monthly payments that cannot be garnished by most creditors. This creates a protected income stream that can help veterans maintain basic living expenses while working to resolve their debt issues.
Similarly, VA pension benefits for wartime veterans with limited incomes are generally protected from creditors, providing a financial safety net.
Medical debt relief
While not directly related to credit card debt, the VA can help veterans reduce their overall debt burden by addressing medical expenses:
- VA health care benefits can reduce or eliminate out-of-pocket medical expenses.
- The VA provides assistance with service-connected medical debt.
- The VA’s Medical Care Hardship Program can help veterans struggling to pay VA medical copayments.
By reducing medical expenses, veterans may have more resources available to address credit card debt.
Housing assistance programs
Housing costs often consume a significant portion of veterans’ budgets. The VA offers several programs that can help veterans reduce housing expenses:
- VA home loans with competitive interest rates.
- Housing grants for disabled veterans.
- Homelessness prevention programs.
Lower housing costs can free up more funds for debt repayment.
Education and employment support
The GI Bill and other VA education benefits can help veterans gain qualifications for higher-paying jobs. Additionally, the VA’s Veteran Readiness and Employment (VR&E) program provides job training and employment services for veterans with service-connected disabilities.
Increasing income through better employment is a sustainable approach to addressing debt in the long term.
Debt management resources
The VA’s benefits website provides educational resources about debt management, and VA staff can refer veterans to reputable non-profit credit counseling agencies such as:
- National Foundation for Credit Counseling.
- American Consumer Credit Counseling.
- Military OneSource financial counseling.
These organizations can help veterans negotiate with creditors, potentially securing lower interest rates or reduced payment plans.
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Special circumstances: the VA Fiduciary Program
For veterans who are unable to manage their financial affairs due to injury, disease, or advanced age, the VA’s Fiduciary Program can appoint a fiduciary to help manage VA benefits. While this doesn’t directly address credit card debt, it can help prevent further financial difficulties.What the VA cannot do
It’s important to understand the limitations of VA assistance:- The VA does not provide direct grants or loans specifically for credit card debt repayment.
- The VA cannot negotiate directly with credit card companies on behalf of veterans.
- VA benefits cannot be used as collateral for debt consolidation loans.
Alternative resources for veterans
Beyond VA-specific programs, veterans should consider other resources:- Servicemembers Civil Relief Act (SCRA) – Active duty servicemembers may qualify for interest rate reductions on debts incurred before service.
- Military relief societies – Organizations like Army Emergency Relief, Navy-Marine Corps Relief Society, and Air Force Aid Society sometimes provide financial assistance to veterans.
- Bankruptcy protection – As a last resort, veterans may consider bankruptcy, which has special provisions for veterans in some circumstances.
Steps for veterans seeking help with credit card debt
- Start with a VA benefits review – Contact your local VA office to ensure you’re receiving all benefits you’re entitled to.
- Seek financial counseling – Use the VA’s referral services to connect with a qualified financial counselor.
- Create a budget and debt management plan – Work with your counselor to develop a realistic plan for addressing your debt.
- Consider debt consolidation or negotiation – Explore options for consolidating debt or negotiating with creditors.
The bottom line
While the VA doesn’t offer a direct solution for veterans’ credit card debt, it provides a comprehensive network of services that can help veterans improve their financial situation. By combining VA benefits with financial counseling, debt management strategies, and access to other resources, veterans can develop a plan to address credit card debt and work toward long-term financial stability. For personalized assistance, veterans should contact their local VA office or call the VA’s general information line at 1-800-827-1000.There’s always JG Wentworth…
If you have $10,000 or more in unsecured debt there’s a good chance you’ll qualify for the JG Wentworth Debt Relief Program.* Some of our program perks include:- One monthly program payment
- We negotiate on your behalf
- Average debt resolution in as little as 48-60 months
- We only get paid when we settle your debt
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* Program length varies depending on individual situation. Programs are between 24 and 60 months in length. Clients who are able to stay with the program and get all their debt settled realize approximate savings of 43% before our 25% program fee. This is a Debt resolution program provided by JGW Debt Settlement, LLC (“JGW” of “Us”)). JGW offers this program in the following states: AL, AK, AZ, AR, CA, CO, FL, ID, IN, IA, KY, LA, MD, MA, MI, MS, MO, MT, NE, NM, NV, NY, NC, OK, PA, SD, TN, TX, UT, VA, DC, and WI. If a consumer residing in CT, GA, HI, IL, KS, ME, NH, NJ, OH, RI, SC and VT contacts Us we may connect them with a law firm that provides debt resolution services in their state. JGW is licensed/registered to provide debt resolution services in states where licensing/registration is required.
Debt resolution program results will vary by individual situation. As such, debt resolution services are not appropriate for everyone. Not all debts are eligible for enrollment. Not all individuals who enroll complete our program for various reasons, including their ability to save sufficient funds. Savings resulting from successful negotiations may result in tax consequences, please consult with a tax professional regarding these consequences. The use of the debt settlement services and the failure to make payments to creditors: (1) Will likely adversely affect your creditworthiness (credit rating/credit score) and make it harder to obtain credit; (2) May result in your being subject to collections or being sued by creditors or debt collectors; and (3) May increase the amount of money you owe due to the accrual of fees and interest by creditors or debt collectors. Failure to pay your monthly bills in a timely manner will result in increased balances and will harm your credit rating. Not all creditors will agree to reduce principal balance, and they may pursue collection, including lawsuits. JGW’s fees are calculated based on a percentage of the debt enrolled in the program. Read and understand the program agreement prior to enrollment.
This information is provided for educational and informational purposes only. Such information or materials do not constitute and are not intended to provide legal, accounting, or tax advice and should not be relied on in that respect. We suggest that you consult an attorney, accountant, and/or financial advisor to answer any financial or legal questions.