How to get a debt collector to stop calling about a bogus bill
Dear Liz: I’m getting daily robocalls from a debt collection agency, even though a check of our current credit reports shows that we owe no one anything. (My husband and I both have stellar credit.) Google tells me that this collection agency is known for shadiness and that the Consumer Financial Protection Bureau has fined it for illegal debt collection practices and repeated violations of consumer reporting rules. I want to make these annoying daily calls stop (I never answer) but I worry that engaging with this company at all, for instance with a letter telling them to go away, will just cause more problems. What’s the best way to handle this kind of situation?
Answer: Debt experts sometimes advise against contacting collection agencies if you owe money, can’t afford to pay it back and are worried about being sued. The concern is that any response from you will trigger increased efforts to collect the money.
Since you don’t owe anything, though, there’s nothing to stop you from trying to end these annoying calls.
The CFPB recommends sending a letter to the collection agency demanding to know more about the alleged debt, including why the collector thinks you owe it, how old the debt is, how much is owed and details establishing the collector’s right to collect. The CFPB has a sample letter on its site you can use. Ideally, this letter would be sent within 30 days of the first phone call to preserve your rights under federal law, but there’s nothing stopping you from sending it at any point.
Once you have information about the supposed debt — or if the calls continue and the agency hasn’t responded — you can send a second letter telling the agency you don’t owe the money and to stop contacting you.
Credit bureau problems regularly top the CFPB’s complaint list. Fixing your credit report requires some effort on your part.
Finding a fiduciary
Dear Liz: I am 55 and a single mom of three teenagers. My money has been sitting at a discount brokerage firm unmanaged ... ugh!! I need help, but I am afraid to hire someone who will lose my money. Plus, two of my kids are old enough now to open a retirement account. We need help!
Answer: There’s actually no age minimum on contributing to a retirement fund; your kids just need to be earning at least as much money as they’re putting into the account. If they want to contribute the maximum $6,500 to an IRA, for example — or you want to contribute that much on their behalf — they have to earn at least $6,500.
The word you’ll want to keep in mind when seeking help with your money is “fiduciary.” Your advisor should be willing to put in writing that they will put your interests ahead of their own.
Many advisors are held to a lower “suitability” standard, which means they can recommend investments that are more expensive or perform worse than available alternatives, simply because the recommended investment pays the advisor more.
You don’t actually need a human being for investment management, though. Your investing firm probably offers target date mutual funds, which adjust the mix of investments to be more conservative as your retirement date nears. Another option is a robo-advisor, which handles the investing according to a computer algorithm.
Where a human can come in handy is if you have broader financial questions, such as whether you’re saving enough, when you can safely retire and whether your family is adequately insured, among other issues. Your discount brokerage may offer access to fiduciary advisors for a fee or in exchange for investing a certain amount of money.
You can also find fiduciary advisors through the Assn. for Financial Counseling and Planning Education, the XY Planning Network, the Garrett Planning Network, the National Assn. of Personal Financial Advisors and the Alliance of Comprehensive Planners, among others.
Liz Weston, Certified Financial Planner, is a personal finance columnist for NerdWallet. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.
