In addition to the social and emotional devastation of gambling addiction, which may include loss of relationships, residence, physical health and career opportunities, the damage exacted to one’s finances is significant. While therapists and groups such as Gambler’s Anonymous can help address the mental and psychological challenges from a gambling disorder, other experts can help gamblers rebuild their financial house.
Financial counselors can provide a variety of services to both the gambler and their family. By taking appropriate measures, counselors can help gamblers rebuild their credit and safeguard the assets of “affected others,” whose money the gambler may have accessed during their addiction.
Many compulsive gamblers have accumulated a seemingly insurmountable level of debt by the time they seek help. Financial counselors can work on their behalf to obtain special, lower interest rates from creditors to satisfy existing debt. Financial counselors can also consolidate debt so that the recovering gambler pays a single monthly payment, an option known as a debt management plan. While debt consolidation is a tool that’s available for anyone — gamblers and non-gamblers alike — it can be especially helpful for someone who has incurred debt from gambling addiction and requires structure to start on a new path.
Recovering gamblers seeking financial relief should be wary of debt settlements, which are fundamentally different than debt management plans and which have been the subject of scrutiny from the Minnesota Attorney General. Debt settlement is a form of debt relief that is considered to be extremely dangerous by financial experts. The process, which involves the paying off of debt to a creditor after mutually agreeing to a sum less than what is owed, often leaves consumers with damaged credit scores and can sometimes lead to even deeper debt.
In addition to credit card assistance, financial counselors can also help with management of student loans and mortgages. HUD-certified financial counselors specialize in foreclosure prevention and can potentially help those who have lost much of their money from gambling by working with mortgage companies to make mortgage modifications. According to Cate Rysavy, senior director of Financial Services at Lutheran Social Service of Minnesota, people are able to avoid foreclosure 64 percent of the time when working with a housing counselor.
Financial counseling can also come to the aid of family members whose monies may have been stolen by the gambler or who may have unknowingly enabled the gambler by providing financial support. Counselors can provide protection to spouses by offering separate accounts for spouses and others to prevent access by the gambler.
A recovering gambler might also wish to engage a Power of Attorney (POA) to help control the disbursement of funds. By setting up a POA, a gambler can ensure there’s controlled access to monies and specify exactly how the funds are to be used. A POA is a formal contract that must be given great consideration. It can be cancelled by revocation by the individual or a resignation by the POA.
In addition to helping those in financial distress, financial counselors may also be the first to identify someone’s gambling problem. They may note frequent cash withdrawals from a casino or determine that something’s amiss with a client’s expenditures given their budget and income.
Ideally, financial counseling, when necessary, takes place at the same time as treatment for gambling addiction. “If someone’s not acknowledging their addiction and seeking treatment, financial counselors are not in a good position to help,” says Cate, who says the biggest concern when working with gamblers is the possibility of relapse. At Lutheran Social Service, counselors are encouraged to make the call for treatment or to GA while they’re still meeting with the problem gambler.
Gamblers seeking a debt management plan should work through a nonprofit member agency of the National Foundation for Credit Counseling. There are three such credit counseling centers in Minnesota: LSS Financial Counseling (1-888-577-2227), The Village Financial Resource Center (1-800-627-8220) and Family Means (1-800-780-2890).