It’s a Friday night in November. Some fifty people are sitting in molded plastic chairs in a one–room brick building that is part of a church complex in Greenwich Village. It’s a comfortable, sparsely furnished room, used by various community groups. Two ceiling–fans turn slowly. The group is listening to a woman talk about her life, and about her money.
She’s in her fifties, a commercial artist. She wears a tailored skirt and a long–sleeved beige blouse. Her name is Ruth B. and she is participating in a meeting of Debtors Anonymous.
“My family was extremely money oriented,” she says. “I grew up thinking it was the paramount value. I was in awe of wealth. I always tried to give the impression that I had money and to live up to the level of my affluent friends.”
Her audience is about evenly divided between men and women, mid–20′s through mid–60′s and dressed in everything from jeans and sneakers to expensive ensembles and business suits. Most pay close attention to her. Some are distracted by matters they want to bring up later.
Ruth describes a way of life in which there was never enough. “I lusted after money,” she says. “I was arrogant and overbearing when I had it. I was totally miserable when I didn’t. I always needed more. And I used bank loans and charge cards to get it. I was constantly in debt.”
She was adroit at juggling her finances and managed to keep the system going for years, she tells them. But she was living on the edge, feeling ever more pressured, ever more desperate. Finally, it all collapsed.
“I was wiped out,” she says. “Everything I had was gone. When I came into the program, I was hysterical. I was stunned. I was suicidal. I couldn’t function.”
Discussion of personal money, particularly indebtedness, may be the last American taboo. Yet roughly one out of every 12 Americans is overwhelmed by debt. In June 1985, the Federal Reserve Board reported that consumer debt for the first quarter of last year had soared to 72% of consumer income – and was continuing to rise.
“The number of people who are severely overextended is huge,” says Marla Kaplan, the former associate director of Bankcard Holders of America, a consumer group in Washington, “and it’s getting worse every month.” Luther Gatling, president of the nonprofit Budget and Credit Counseling Service in New York, says, “Twenty million Americans are only one paycheck ahead of catastrophe. Their debts are destroying them.”
Like Ruth, they often feel helpless, angry and confused. They become fearful, depressed, even suicidal. They live with a daily sense of impending disaster.
Debtors Anonymous is a 10–year–old self–help program [in 2011 35–years–old], modeled on Alcoholics Anonymous, that provides moral support for those in debt. Though precise figures are not available, Debtors Anonymous estimates that its membership has tripled in the last year – to about 4,000, with chapters in New York, Los Angeles, San Francisco, Washington, Boston, Chicago, Miami, Paris, London, and other cities.
At each meeting, one member serves as principal speaker. At this one, it is Ruth, who has been attending for three years. Tonight, she’s relaxed as she tells her story, breaking into laughter several times. She is no longer in debt. Her business is thriving.
Ruth concludes, then opens the remaining hour to general discussion. A public relations man says he understands her earlier despair. He was $45,000 in debt two and a half years ago, when he first came to D.A., and felt crushed and hopeless. “I never understood money, or what I did with it,” he says. Now he has paid off $15,000 of his debts, and his marriage, which had been in trouble because of his financial difficulties, is much stronger.
A physical therapist in her early thirties expresses her pleasure in having watched Ruth change. It was months, she says, before she first saw her smile.
A young man in a sweat shirt with the sleeves cut off talks about his fear over asking his employer for a raise. “I know better. I’m learning. But deep down inside I still don’t believe I’m worth more money.”
A woman in her late twenties is clearly uncomfortable. She finds it nearly incomprehensible, she says, that Ruth and others can cite specific amounts of income and debt so casually. She’s been in the program eight months, but still hasn’t been able to speak in anything but generalities. She wants to tell them now exactly what she does and how much debt she’s carrying. She has to force the words out. She works in computer art, she says. She owes $25,000. She is shaken, but also appears relieved. Another woman gives her hand a squeeze.
A man with his temples going to gray recounts a meeting with an officer of the bank that is his major creditor. Acting on suggestions given him here, he successfully negotiated a six–month moratorium on payments.
A woman in her late twenties suddenly explodes. She’s a secretary and this is only her fourth meeting. “I’m furious,” she tells them in a taut, quivering voice. “I hate being in debt! I hate not having enough! I hate everything about this!”
“That’s odd,” someone else says, deadpan. “The rest of us really loved it.”
Several people break into laughter. The secretary glares at them. Then suddenly, she laughs too.
At the meeting’s end, people help put the chairs away and straighten the room. They leave slowly, milling about, breaking into smaller groups to talk or to head out for coffee or food.
Some people walk in to their first meeting of Debtors Anonymous earning more than $100,000 a year. Others are on welfare or unemployment. Some owe amounts substantially over six figures, others no more than $500 or a $1000. “The numbers don’t matter,” says John H., a communications executive who has been in the program since its earliest days. “It’s what debt has done to your life, the toll in human misery it’s taking.”
There are doctors and lawyers in D.A., housepainters, university professors, carpenters, psychologists, nurses, secretaries, executives, artists, writers, actors, stock clerks and stockbrokers.
Debtors Anonymous has absorbed the principles of Alcoholics Anonymous, which are concerned with the spiritual well-being of members, but the program – again, like A.A. – is in no way religious. Its membership includes Christians and atheists, Jews and agnostics. The organization’s preamble, which is read aloud at the beginning of each meeting, states, “D.A. is not allied with any sect, denomination, politics, organization or institution . . . neither endorses nor opposes any causes.”
It also states that Debtors Anonymous “is a fellowship of men and women who share their experience, strength and hope with each other that they may solve their common problem and help others to recover from compulsive debt.”
“Compulsive” and “debt” are key words here. Compulsive, in D.A. terms, means that the individual has a history of repeatedly incurring debt despite negative emotional and financial consequences. He or she somehow justifies each new loan or late payment, or borrows to obtain relief from pressures often perceived as intolerable.
“Compulsive debting is very real,” says Nancy Dombrowski, a New York psychotherapist who specializes in addiction. “People know that it’s self-destructive, but they continue to borrow and buy anyway. It’s an addiction, just as serious as cocaine, pills or alcohol.”
Dr. Marilyn Jacovsky, former head of research for customer affairs at Citibank, a psychotherapist who specializes in dependency, says: “The compulsion to use debt and credit is just like any other compulsion – the compulsion to overeat, for example. It is progressive, and it finally goes out of the individual’s control.”
By debt, Debtors Anonymous means non-collateralized or unsecured debt – anything from a personal loan to falling a month or two behind in the rent. A secured loan, in the form of a mortgage or a car purchased on time, on the other hand, is acceptable. “If things go wrong,” says one member, “your creditor takes your security, but you walk clean, you don’t owe anyone money.
The subject is debt, but the deeper issue at Debtors Anonymous is the quality of life. “Getting out of debt and mastering your money leads to profound changes,” says John H. “You get back control of your life, you own it. You gain self-esteem. The fear leaves you. Prosperity enters, not just financially, but in everything from your response to a sunny day to the quality of your relationships.
“All that flashy outside stuff – paying everyone off, big jumps in income – does happen,” says John H., who is as likely to quote St. Ignatius Loyola as he is The One–Minute Manager. “But,” he adds, “the foundation, the internal mechanism of the change, is spiritual.”
Most members of DA seem to agree.
“I was miserable while I was in the throes of debting,” says Gail C., a social worker. “My emotions were chaotic. I was fearful, sleepless. I couldn’t think about anything but my debts. All that has changed. I’m calm now. I’m no longer consumed by personal worries. I have a sense of serenity.”
The similarity between Debtors Anonymous and Alcoholics Anonymous is not coincidental. D.A. was founded in 1976 by a man who had been sober in Alcoholics Anonymous twenty-seven years. Despite a high income, his debts had mounted progressively to the point at which he felt crippled by them and almost unable to bear the pressure. He found another person in similar straits. They sat down to talk seriously about their debts, and that was D.A.’s first meeting. He eschews any further detail about himself. People who know him well say his reticence stems from a deep spirituality and genuine humility. A sly and often humorously cantankerous man, he himself says its because he doesn’t want to be set apart, as was to some degree the co-founder of A.A. – Bill Wilson – and thus be prevented from participating in the program as freely or easily as any other member.
How does Debtors Anonymous work? It offers techniques, strategies and “tools,” but it is basically a process, a gradual change in perceptions and attitudes about money and self. Admitting the problem is essential, and that’s not easy, members say. Denial is nearly universal. It’s the divorce, people tell themselves, it’s the job market, late paying accounts, taxes, the economy, interest rates, the new roof, high rents. Often an individual has to be driven right up against the wall, and through it, before being willing to face facts.
An incoming member is encouraged to avoid taking on any new debt for that day. That concept is vital. Next week and next month are too much to think about, the program says, but anyone can abstain from incurring a new debt for one day – this day.
Income is the second area of consideration, and it is usually dealt with in two stages: first, stabilizing it to match monthly expenses; second, increasing it. Stabilization may involve seeking a moratorium from a creditor, taking in a roommate temporarily, and similar options. Although the major concern is to avoid new debt, an increase in earnings is a logical extension – by taking on a part-time job, requesting a promotion, changing jobs, or aggressively seeking new business.
Members are committed to repaying each of their debts in full, but only on a schedule consistent with a tolerable life. Living for one’s creditors, the program says, results in feelings of deprivation, impoverishment and futility. “This isn’t about working harder and eating cat food,” says Jim S. “It’s about improving your life.”
Regular attendance at meetings is important. As in Alcoholics Anonymous, each chapter functions autonomously, but is linked together through the general organization. Members are welcome to attend the meetings of any chapter. Most move back and forth between several different ones and often stop in at meetings in other cities when they travel. At each chapter, a new member is elected every three months or so to chair meetings, generally held once a week.
There are no dues or fees for members. Voluntary contributions dropped into a basket at each meeting are D.A.’s sole source of income. It is wholly self-supported and neither seeks nor accepts any funds from outside sources.
Several issues might surface on any given night: compulsive spending, use of money as a mood-changer, fear of success. There are a surprising number of people who unconsciously hold themselves back or sabotage their own efforts because of low self-esteem, fear that they can’t handle responsibility, that they’ll be revealed as somehow fraudulent, or because of a desire to be taken care of, and even a reluctance to surpass parents.
The “Spending Record” is cited as the single most valuable tool in the program. This is a daily record of all expenses, to the penny, broken down into as many precise categories as possible, and totaled, usually week by week, and again at the end of the month. “It tells you exactly where your money is going,” says John H.,” and that knowledge is power. Once you know what’s going on, you can begin to change it.” This device might seem simplistic, but it is highly effective, according to members. Not only does it provide a revealing portrait of one’s life, they say, but the basic act of keeping the record can reduce cash outflow by 5 to 10 percent.
“Pressure Meetings” [now called Pressure Relief Meetings] – another tool – are actually designed to take the pressure off, not put it on. A member selects two solvent and experienced members whom he respects. (“Solvent” is defined as not having incurred unsecured debt for a given length of time.) They meet privately with the troubled member and discuss in detail the problems – a faltering business deal, an angry creditor, or simply vague fear.
Many members of Debtors Anonymous are reticent and even embarrassed about describing, only in dollar amounts, what has happened to them. But that in itself is often dramatic.
Alex I., a real estate salesman, was $36,000 in debt and on the verge of bankruptcy when he entered the program. He has since repaid more than $30,000 and increased his income from $40,000 to $70,000.
Alex has remained in real estate but, with the support of his “Pressure Group,” began to change his working habits and attitudes – pursuing clients more aggressively, keeping clearer records, following up inquiries, and taking a more philosophical approach to the vagaries of the business.
Not everyone who looks at Debtors Anonymous stays. Glenn B., a welder, attended four meetings. “I didn’t understand what they were talking about. I felt lost. Also, I’m going back to school and I need a loan. I picked up that wasn’t the thing to do. I know in my gut I’ll be back.”
Some remain a while and then leave. Often they return later. “My situation had improved,” says Ken L., a salesman. “My life was more manageable and I was making a lot more money.” He was gone two years, reappeared three months ago. “Things began slipping. I was reverting to old habits. I came back before it got bad.”
The largest concentration of chapters is in New York and California, but new ones are being formed in other areas at a rate of about five a month. Inquiries can be made by letter or telephone [and now by email too]. Calls are taken by a service. Response time may be slow because of limited budget and because volunteer members do all the work, but each inquiry will be answered. The address is:
Debtors Anonymous General Service Office
PO Box 920888
Needham, MA 02492–0009
Members of the organization’s general service board – D.A.’s elected officers – say that there are issues yet to be resolved – how best to work with a married member whose spouse does not have the same problem; what, precisely, constitutes debt in business among business owners [there are no special-focus meetings for business owners]. Its organizational and administrative arms are still being shaped and aren’t always able to deal with the program’s growth quickly or effectively. Some members point out that the challenges are similar to those faced by Alcoholics Anonymous in its first years.
“What the program is and what it isn’t may make for interesting discussion,” says John H., “but only one thing really matters here – pragmatic results. This works. It’s that simple.”
Currently, Debtors Anonymous has more than 400 groups functioning in the United States and groups in Australia, Canada, France, England, Israel, and Japan as well [there are also telephone meetings and online meeting lists now.] D.A. remains the best and most effective self-help organization there is for helping people deal with debt. But some of its groups tend to wander off topic and spend much of their time dealing with material that would be more appropriate for other programs, such as Al-Anon or ACoA. And within many groups there are often a few people who want to talk mostly about their childhood or to excuse or justify their continued debting, to convince others that they simply had to debt.
The following commentary, which addresses that phenomenon, has been excerpted/adapted from my book Earn What You Deserve: How to Stop Underearning & Start Thriving:
‘Debt Is about Money
– Not about Love, Art, Fame, Glory,
Or Personal Relationships.’
Debt has to do with money, not with abstractions, emotions, or anything else. With money – with repeatedly spending money that is not yours: Visa’s, your brothers, Sears’, your dentist’s when you don’t pay him immediately for work he’s done, Mobil Oil Company’s, your landlord’s when you fall behind in your rent, the IRS’s if you’re self–employed and don’t make your quarterly tax payment, Bloomingdale’s . . .
Debt does not involve bringing in less love than you need. Or getting less recreation than you need. Or not spending enough time on your art. Or anything else. Those may all be valid issues related to debt, be part of a syndrome around debt, but they are not debt itself.
There is a danger, in the first flush of discovery, or early stages of healing, of trying to extend the concept of debt so that it becomes all-embracing. This only confuses the issue and makes remedying the problem much more difficult, if not impossible. In some groups of Debtors Anonymous, some people began to call themselves self-debtors, emotional debtors, and the like. At its extreme, people were speaking of time debting, play debting, art debting, and even space debting (not having enough room.) This hopelessly confused the real problem for them. Even worse, it confused the people who were coming into those groups for the first time, under terrible pressure from their debts and trying to find help. The practice led to such irrational statements as, “I’m not going to debt to myself anymore, so I borrowed $300 from my brother to buy a new winter coat.” In that statement the entire concept of not incurring any new unsecured debt one day at a time, ofrecovering from debt, is lost.
There are many issues related to the problem of debt, but they are not the problem itself. The beginning of wisdom, goes an old Chinese epigram, is to call things by their right name. Other issues, which either contribute to debt or result from it, are part of the syndrome of debt.
If you choose to avail yourself of the help that can be had from Debtors Anonymous, you will get the greatest benefit by participating only in groups whose members are utterly clear that their primary purpose is to abstain from incurring unsecured debt one day at a time and to help debtors who are still suffering, groups with a high percentage of solvent (non-debting) members, groups where, although some people might and probably will be in pain on any given night and might be expressing that pain, the focus is on solutions rather than problems.