Debt support groups give help, not stigma

After years of free spending – $200 jeans, a silver BMW and other grown-up toys – Michael Wagner had racked up $25,000 in credit-card debt and was behind on his mortgage and car payments. Creditors called night and day. It was a “hopeless downward spiral,” he says.

Then, last November, the 34-year-old sales manager for the St. Louis Post-Dispatch joined the “Sunday morning breakfast club,” a group of debtors who meet weekly over coffee and eggs to share money woes. Wagner says he is now on the road to financial recovery, helped by his discovery that “I wasn’t alone.”

Far from it. In the debt-soaked economic slump of 2008, growing numbers of Americans are finding solace – and solutions – in support groups for the overextended. Gatherings like Wagner’s are springing up at churches, colleges and coffee shops.

Meetup.com, a Web site that organizes physical and virtual meetings, says it now serves 138 groups who gather in person to talk about debt management, up from 24 a year ago. Debtors Anonymous – a cousin of Alcoholics Anonymous – reports greater demand particularly in Southern California and Arizona, areas hit hard by the downturn. Activity is rising online: Postings are up 81 percent this year on the debt-related message boards of iVillage, a women-oriented site owned by NBC Universal.

And since the beginning of this year, the Southern Baptist Convention has been sending representatives around the country who are urging churches to start debtor support groups.

Group therapy for folks who owe a lot isn’t a new idea. Debtors Anonymous has been bringing borrowers together to battle what it calls “compulsive debting” for decades. But for years the group’s growth was hampered by the social stigma surrounding money problems, says a spokesman. “It used to be that you had to live in shame about debt,” said Ashley Clayton, who helps organize the Southern Baptist campaign. “Now, there’s been an awakening.”

Growing pressure – 11.8 million bank credit-card accounts are delinquent, and foreclosure filings topped two million last year – is making more people ready to share debt problems with strangers. And many of the more outspoken debtors hail from a younger generation, who grew up with credit cards and without Depression-era memories.