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Massachusetts Debt Relief Guide

Massachusetts residents face a tale of two economies. The tech sector is growing far faster than the rate of the U.S economy as a whole, and wages are rising. But that’s just one side of the story.

“Low-wage sectors such as leisure and hospitality and personal services were hit the hardest in the shutdown and remain the sectors experiencing the slowest employment recovery,” MassBenchmarks senior contributing editor Clayton-Matthews explains in a University of Massachusetts report. As a result, many people are experiencing long-term unemployment, meaning they are not counted in unemployment statistics.

The average debt-to-income ratio in the state stands at 116 percent. That means that the average Massachusetts resident owes $1.16 in debt for every dollar they earn.

“While the story for Massachusetts technology workers is great, others are still suffering in a pandemic economy,” says Gary Herman, President of Consolidated Credit, and unfortunately, the recovery is moving at a slow pace. That makes it more crucial than ever that people focus on paying down debt and shoring up their savings to better deal with the down economy and the ongoing potential for unemployment.”

Consolidated Credit Helps Massachusetts Residents Reduce Their Total Credit Card Payments by Up to 50%

Consumer debt in Massachusetts

This chart shows a breakdown of average consumer debt in Massachusetts, based on the latest report of Household Debt report from the Federal Reserve.

In 2020, 4,287 Massachusetts residents filed for bankruptcy.

Income and employment in Massachusetts

The per capita (average per person) income in Massachusetts is $79,721. That’s a good deal higher than the national average of $59,729 and is a slight compensation for the higher cost of living in Massachusetts. The high cost of living in Massachusetts has led to many residents owing more than they make.

Massachusetts is not a right-to-work state, so workers can choose to join a union or not. The state has a very competitive job market. Unemployment currently sits at 4.9 percent. There currently are no federal unemployment benefits or programs. However, unemployment benefits in Massachusetts are very generous and can reach up to $855 per week for a single person. The rate is generally half of your earnings until you reach the maximum benefit.

That means if you are unemployed and living in Massachusetts, even with a higher unemployment benefit, the chances are that you are struggling financially. If you’re in this situation, take steps to prioritize your bills and keep debt minimized.

Apply for unemployment benefits in Massachusetts»

To file a claim by telephone number: (877) 626-6800

For help finding a job, visit a Massachusetts Job Centers

Banking and taxes in Massachusetts

Massachusetts residents pay a flat income tax of 5%, although certain capital gains have a tax rate of 12%. Everyone who earns more than $8,000 annually must file taxes. There is also a sales tax of 6.25%. There is one sales tax holiday weekend each year in Massachusetts. On that weekend, there is no sales tax for select items up to $2,500, except for clothing which has a limit of $175. In 2021, the tax-free holiday was on August 14th and 15th.

Massachusetts residents are also more likely to bank than the average American. The percentage of unbanked residents—those without a checking or savings account stands at just 3.7%.

Massachusetts housing market

Massachusetts has always had a highly competitive housing market, particularly in highly populated areas like Boston. However, this year has seen a rapid increase in both average home prices and rent. Additionally, the statewide inventory of single-family homes is down over 50%, and condos are down 38%.

Because of this tight market, there are frequently bidding wars for the remaining homes left on the market. Not only are prices rising, but investors are driving up prices and competing against regular buyers. Many investors pay in cash, allow them to buy quickly and buy over market value. In contrast, potential buyers typically have to wait for mortgage financing. That’s edging out first-time homebuyers and leaving them with few options.

Massachusetts does have an exceptional homestead exemption, with an automatic $125,000 exemption even if you don’t file. That exemption goes up to $500,000 when you file. If you are over age 62 or are legally disabled, your exemption goes up to $1,000,000. You can even homestead properties that are in a trust. (People typically put a home in a trust to avoid the probate process after they die.) These large homestead exemption amounts make homeownership a highly attractive option for residents who can afford to buy.

  • 4% of Massachusetts residents are homeowners
  • Average mortgage payment: $2,165
  • Median rent payment: $1,282

Massachusetts does have an emergency assistance program if you are facing difficulties making rental payments or mortgage payments. There are also programs for first-time homebuyers sponsored by the State of Massachusetts.

Talk to a HUD-certified housing counselor to get help with the housing challenges you’re facing

Retirement in Massachusetts

Massachusetts can be a fantastic place to retire. Healthcare facilities in the state are top-rated, and access to high-ranked higher education can keep your mind going. If you are a fan of history, you might just be in paradise. Picturesque cities and towns with a history dating back to the 1600s make for great day trips. You can also choose between small towns and big cities, beachfront living, or mountain views. The greater Boston area is one of the most walkable cities in the United States, and you may not even need a car. If you’re a sports fan, the Red Socks and New England Patriots are popular teams, and the Fenway Park baseball stadium is a national treasure. Public transportation is excellent, and travel to outside locations is effortless.

However, retiring in Massachusetts is not cheap. A 2018 study found that retirees need roughly $1,200,000 in assets to retire comfortably in the state. Unfortunately, approximately one in five (19%) of elderly households rely on Social Security for at least 90% of their income.

Working Massachusetts residents also have a long way to go to achieve a comfortable retirement if they plan to stay in the state. The average retirement savings stand at just $457,681. The average resident retires at age 66.

Average Massachusetts insurance premiums

Massachusetts residents face some high rates when it comes to protecting their homes, vehicles, and health with insurance. Massachusetts is a no-fault state for auto insurance. The average driver has an auto insurance premium of $1,314 per year.

Homeowner’s insurance rates are lower than the national average of $1,631. The average Massachusetts homeowner’s insurance premium is $1,203 per year.

Health insurance premiums are very high compared to the national average of $5,936. The annual health insurance premium in Massachusetts is $7,184. Massachusetts has an excellent health care system with near-universal coverage and an uninsured rate – the lowest in the nation – of just 3%.

Helpful resources for Massachusetts residents facing hardship

Food insecurity

City/RegionFood BankPhone NumberAddress
Central MassachusettsThe Greater Boston Food Bank(617) 427-520070 South Bay Ave, Boston, MA 02118
Central MassachusettsWorcester County Food Bank, Inc.(508) 842-3663474 Boston Turnpike, Shrewsbury, MA 01545
New HampshireNew Hampshire Food Bank(251) 653-1617700 East Industrial Park Drive, Manchester, NH 03109
Western MassachusettsThe Food Bank of Western Massachusetts(413) 247-973897 North Hatfield Road, Hatfield, MA 01038


As of 2019, Massachusetts was home to 1,440,338 Veterans. These resources are available to help Veterans that are facing unemployment, homelessness, and other hardships.

Massachusetts Department of Veterans’ Affairs

National crisis hotline: (800) 273-8255

Massachusetts Veterans Support Line: (844) 693-5838


600 Washington Street, 7th Floor

Boston, MA 02111

(617) 210-5480

Find a Veteran service office in your area »

Helpful employment resources for Veterans:

How Consolidated Credit helps Massachusetts residents find debt relief

In 2021, Consolidated Credit provided free credit counseling to 3,329 Massachusetts residents. Of those, 204 went on to consolidate their debt with our help through a debt management program (the average amount of debt enrolled was $9,622). The others received a free debt analysis and complementary budget evaluation, and they were directed to the right solution for their situation to get out of debt as quickly as possible.

We’d also like to congratulate the 252 Massachusetts residents that got debt-free last year with the help of Consolidated Credit!

A debt consolidation loan is an unsecured personal loan that you get to pay off credit cards and other existing debts. You need good credit to qualify for the lowest interest rate possible. That low rate helps lower your total payments so you can get out of debt faster, even though you may pay less each month. So, this is a good solution for Massachusetts residents with a high credit score.

A home equity loan or home equity loan of credit (HELOC) is a debt solution that’s only available to Massachusetts homeowners. If you have equity available in your home, you can borrow against that equity and use the funds to pay off your debt. However, this can be a risky option for paying off credit card debt if you are living paycheck-to-paycheck. Home equity lending products put consumers at risk of foreclosure if they can’t make the payments. If you are considering borrowing against your home, call 1-800-435-2261 to speak with a HUD-certified housing counselor to make sure this is a safe option for you.

Nonprofit credit counseling services like those provided by Consolidated Credit help consumers identify the best solution for getting out of debt. This is a free service. Massachusetts residents can get a confidential debt and budget evaluation from a certified credit counselor. Then the counselor will explain options that are available to each person and recommend the best course of action based on an individual’s needs and goals.

If a Massachusetts consumer cannot get out of debt effectively on their own but has the ability to repay everything they owe to avoid bankruptcy, a debt management program is often the best solution. You enroll in the program through a credit counseling organization. They help you find a monthly payment you can afford and then work with your creditors to reduce or eliminate interest. Qualifying residents can get out of debt in 36-60 payments.

Debt settlement allows Massachusetts residents to get out of debt for a percentage of what they owe. You can settle debt on your own and negotiate with individual creditors and collectors or enroll in a debt settlement program to get professional help. This does cause credit damage. Each debt settled will be noted on your credit report for seven years from the date the account first became delinquent. However, it can be a viable debt relief option for avoiding bankruptcy when you are completely overwhelmed with debt.

If you’re curious how we can help you, below you will find a few case studies from clients that we’ve helped in Massachusetts residents. If you’re facing challenges with debt, call us at (844) 276-1544 to receive a free debt and budget evaluation from a certified credit counselor.

Massachusetts residents trust us with their debt. Contact us today and we can help you find the right solution for your debt!

Case Study

Anthony from Charlton, MA

“Any issue that has come up has been taken care of ASAP. It’s amazing that we’ve paid of $70,000 of our debt in 4 years! Thanks for the help! ”

Where he started:
  • Total unsecured debt: $99,753.00
  • Estimated interest charges: $58,713.66
  • Time to payoff: 15 years, 9 months
  • Total monthly payments: $3,990.12
After DMP enrollment:
  • Average negotiated interest rate: 7.20%
  • Total interest charges: $14,997.58
  • Time to payoff: 4 years, 7 months
  • Total monthly payment: $2,089.00
Time Saved

11 years, 2 months

Monthly Savings


Interest Saved


Case Study

Kelly from Worcester, MA

“Consolidated Credit has turned my life around!!! With one last payment left, I will finally be debt free!! ”

Where she started:
  • Total unsecured debt: $21,094.00
  • Estimated interest charges: $11,897.64
  • Time to payoff: 12 years
  • Total monthly payments: $843.76
After DMP enrollment:
  • Average negotiated interest rate: 3.32%
  • Total interest charges: $1,347.91
  • Time to payoff: 4 years, 7 months
  • Total monthly payment: $408.00
Time Saved

7 years, 5 months

Monthly Savings


Interest Saved


Case Study

Lyle from Wilbraham, MA

“Consolidated Credit has been very helpful to us. It’s a great feeling paying down our debt. ”

Where he started:
  • Total unsecured debt: $30,053.00
  • Estimated interest charges: $17,297.09
  • Time to payoff: 15 years, 1 month
  • Total monthly payments: $1,208.24
After DMP enrollment:
  • Average negotiated interest rate: 10.56%
  • Total interest charges: $8,366.05
  • Time to payoff: 4 years, 5 months
  • Total monthly payment: $746.00
Time Saved

10 years, 8 months

Monthly Savings


Interest Saved


Ready to see if Consolidated Credit’s debt relief program is right for you? Talk to a certified credit counselor now for a free debt evaluation.