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Missouri Debt Relief Guide

When it comes to credit card debt, Missourians seemed to fare better than most following the pandemic. In fact, the state ranks 31st for highest credit card balances in 2020, with consumers carrying an average balance of $4,950. But things aren’t all roses for Missouri consumers.

Missouri made a multi-million-dollar mistake by overpaying on Federal Pandemic Unemployment Compensation. Nearly 46,000 Missourians were mistakenly paid $150 million worth of aid. That means some Missourians could get hit with liens on their homes, have their wages garnished, or even have money taken from their state and federal income taxes.[1]

“This issue with unemployment just goes to show how unexpected life events can come at any time and make a challenging financial situation even tougher,” says Gary Herman, President of Consolidated Credit. “In times like these, you can see the importance of keeping your finances in the best possible shape. And that starts with paying down credit card debt.”

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

Consumer Debt in Missouri

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

In 2020, 12,313 Missourians filed for bankruptcy compared to the previous year’s filing total of 17,054.

Income and employment in Missouri

The per capita (average per person) income in Missouri is $51,177, which is lower than the national average of $59,729. They have a median household income of $55,461. And Missouri’s minimum wage of $10.30 is fairly higher than the federal minimum wage of $7.25.

Missouri is not a right-to-work state, which means employees can choose whether they want to join a union. Union members can also resign their union membership whenever they wish. And when it comes to non-members, they are only required to proportionately pay for their part of a union’s proven bargaining costs.

On top of this, non-members cannot be forced to pay any fees until the costs have been stated. But an individual can still challenge the costs provided by the union.

Missouri also operates as an employment-at-will state. This means that an employer can terminate employment at any time and for any reason. Consequently, neither the employer nor the employee guarantee they will uphold their end of the employment agreement. Therefore, an employee may similarly terminate their employment relationship.

These two things together mean that Missourians enjoy flexibility and freedom of choice when it comes to employment. But it can also mean less job security and less bargaining power for benefits. As a result, job seekers need to negotiate benefits on their own. It’s also a good idea to have a more robust emergency savings fund in case you face unemployment.

In 2020, Missouri maintained fairly high unemployment rates of 6.1 percent. By September 2021, that percentage dropped to 3.7, which was 1.1 points below the national average. This puts Missouri in 16th place when it comes to unemployment rates.

Unemployment Benefits: 

  • Minimum per week: $35
  • Maximum per week: $320
  • Maximum availability of benefits: 20 weeks

General Information about the Unemployment Insurance Program:

https://laboranswers.mo.gov/hc/en-us/sections/4403616873751-For-Workers

To file a UI claim online:

https://uinteract.labor.mo.gov/benefits/home.do

To file a claim by telephone number:

https://labor.mo.gov/contact-labor

Coronavirus update: Missouri is providing updates on Unemployment Insurance changes related to COVID-19 here:

https://labor.mo.gov/coronavirus

Banking and taxes in Missouri

Missouri has an income tax rate range of 1.5%-5.4% and a state sales tax of 4.225%, with local tax rates ranging between 4.225% and 10.35%. For example, Columbia has a 7.975% sales tax rate, Kansas City has an 8.6% sales tax rate, and St. Louis has a 9.679% sales tax rate.

Banking is also less common compared to most states. Residents without a checking or savings account represented 6.2% of the population.

Missouri housing market

For many Missourians, it can be frustrating trying to buy a home because they are currently in a seller’s market. Though home prices are generally below or equal to the national average ($230,000), in the more cosmopolitan cities, like Columbia, they can get a little pricier. The median listing home price for houses in Columbia is $239,000.

Comparatively, statewide home prices were up 7% year-over-year in November 2021. And the number of homes sold rose by 2.2%. However, the number of homes for sale fell by 27.9%.

It’s no surprise to see that areas like St. Louis and Kansas City are hot markets with low inventory. St. Louis has a median home listing price of $200,000 with an average of 20 days on the market. Kansas City has an average home listing price of $236,000 and homes spend an average of 19 days on the market. Rents have also increased by 14.3% making Kansas City the second-fastest growing city in the metro area.

  • 66.8% of Missourians are homeowners
  • Median mortgage payment: $1,254
  • Median rent payment: $830

If you file for bankruptcy in Missouri, the state offers a homestead exemption of $15,000. This means that residents can exempt up to $15,000 of equity from their homes.

If you have challenges making rental payments, you can seek assistance through Missouri’s rental programs. For those seeking mortgage relief, Missouri offers a lending hand through the State Assistance for Housing Relief (SAFHR) program.

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

Retirement in Missouri

Retirement can be tricky in Missouri as the average retiree has $390, 863 saved up for retirement. Though this may seem like a hefty sum of money, it is almost half the amount needed to retire comfortably in the state. The average retiree needs $771,000 in savings to retire comfortably in Missouri.

But what draws retirees to Missouri is the fact that home prices are generally some of the lowest in the country. It also helps that the cost of living is 16.3% lower than the national average. And for the 23% of retirees relying on Social Security for at least 90% of their income, the fact that Missouri has a low income tax is seen as a bonus.

Plus, Missouri only partially taxes Social Security income. So, this works out in retirees’ favor. However, when it comes to withdrawing from retirement accounts, Missouri fully taxes them. Public pensions are also fully taxed.

Average Missouri insurance premiums

High insurance premiums are one thing that may make retirees think twice about retiring in Missouri.

Missouri operates under a variant of the fault-based system, known as the pure comparative fault system, when it comes to car accidents. This rule is used by insurance companies and in lawsuits to determine the level or percentage of fault, or negligence, each party has in an accident. As a result, auto insurance premiums in the state are fairly high at $1,895.

When it comes to average annual home insurance premiums, Missouri has some of the highest rates in the country at $2,377. Similarly, average health insurance premiums are high, at $6,572. That lands Missouri 11th on the list of highest health insurance premiums in the country.

Helpful resources for Missourians facing hardship

Food Insecurity

City/RegionFood BankPhone NumberAddress
ColumbiaThe Food Bank for Central & Northeast Missouri573-474-10202101 Vandiver Drive, Suite B, Columbia, MO 65202
Kansas CityHarvesters – The Community Food Network816-929-30003801 Topping Avenue, Kansas City, MO 64129
SikestonSoutheast Missouri Food Bank573-471-1818600 State Highway H P.O. Box 190 Sikeston, MO 63801
SpringfieldOzarks Food Harvest417-865-34112810 N. Cedarbrook Ave, Springfield, MO 65803
St. JosephSecond Harvest Community Food Bank816-364-3663915 Douglas, St. Joseph, MO 64505
St. LouisSt. Louis Area Foodbank314-292-626270 Corporate Woods Drive
Bridgeton, MO 63044

Veterans

As of 2019, Missouri was home to 401,779 Veterans. These resources are available to help Veterans that are facing unemployment, homelessness, and other hardships.

Veteran Resources:

https://mvc.dps.mo.gov/

https://www.va.gov/directory/guide/fac_list_by_state.cfm?State=MO&dnum=All

Helpful employment resources for Veterans:

How Consolidated Credit helps Missouri residents find debt relief

In 2021, Consolidated Credit provided free credit counseling to 3,040 Missouri residents. Of those, 129 went on to consolidate their debt with our help through a debt management program (the average amount of debt enrolled was $10,373). 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 117 Missouri residents that got debt-free last year with the help of Consolidated Credit!

Relief options to consider if you’re in debt in Missouri

If you have good credit and need to pay off credit card debt and other non-secured debts, a debt consolidation loan is an excellent option for you. By having good credit, you’ll get a low-interest rate for a loan that refinances all your debt with one monthly payment. This will help you get out of debt faster, and you may wind up paying less each month. This is an excellent solution for Missouri residents with high debt and a good credit score.

Missourian homeowners may qualify for a home equity loan or a home equity loan of credit, sometimes called a (HELOC). These types of loans use the equity in your home. Due to rapid home value increases, many residents have equity in their homes. The loan allows you to borrow against the equity in your home and pay off credit cards and other debt. This is not a step to take lightly because you could lose your home in foreclosure if you 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.

Consolidated Credit helps Missouri residents with counseling programs that identify the best way to get out of debt after considering their situations. Missouri residents can get a confidential debt and budget evaluation from a certified credit counselor. Afterward, the counselor will go over the available options and which course of action best meets a person’s needs and goals.

In Missouri, as in other states, it’s best to avoid bankruptcy. If you can afford to repay all that you owe to avoid credit damage but can’t do it on your own, a debt management program can help. You enroll through a credit counseling agency. The agency will work with your creditors to reduce or eliminate interest and work out a payment schedule. Qualifying Missourians can get out of debt in 36-60 payments, on average.

Another option for Missouri residents is debt settlement. With debt settlement, you settle your debt independently or with the help of a debt settlement company. In this program, you agree to pay your creditors a portion of what is owed. This will damage your credit rating because you are not paying on the terms you first agreed to. Late payments, which are often part of this program, will hurt your credit rating for seven years. Even with those negatives, this can be an excellent program for Missourian residents with overwhelming debt. It can help you avoid bankruptcy.

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

If minimum payments are getting you nowhere, it’s time to find a better way to get out of debt. Talk to a certified credit counselor for a free debt and budget evaluation.

Case Study

Cheryl from Fallon, MO

“Consolidated Credit has helped me get rid of all the bills that have accumulated over the years. I can’t thank you enough! ”

Where she started:
  • Total unsecured debt: $99,162.00
  • Estimated interest charges: $58,738.00
  • Time to payoff: 17 years
  • Total monthly payments: $3,966.48
After DMP enrollment:
  • Average negotiated interest rate: 5.18%
  • Total interest charges: $16,348.07
  • Time to payoff: 4 years, 5 months
  • Total monthly payment: $2,084.00
Time Saved

12 years, 7 months

Monthly Savings

$1,882.48

Interest Saved

$42,390.17

Case Study

Gerald from Fallon, MO

“This program has reduced my interest rate and I can already see my payments making an impact. ”

Where he started:
  • Total unsecured debt: $29,318.00
  • Estimated interest charges: $17,211.27
  • Time to payoff: 15 years, 1 month
  • Total monthly payments: $1,172.72
After DMP enrollment:
  • Average negotiated interest rate: 7.33%
  • Total interest charges: $4,970.42
  • Time to payoff: 4 years, 2 months
  • Total monthly payment: $645.00
Time Saved

10 years, 11 months

Monthly Savings

$527.72

Interest Saved

$12,240.85

Case Study

Linda from Kansas City, MO

“Consolidated Credit has been awesome! No worries, no fret. Thank you so much for being there for my family! ”

Where she started:
  • Total unsecured debt: $41,689.00
  • Estimated interest charges: $24,381.00
  • Time to payoff: 14 years, 7 months
  • Total monthly payments: $1,667.56
After DMP enrollment:
  • Average negotiated interest rate: 5.46%
  • Total interest charges: $3,258.75
  • Time to payoff: 4 years
  • Total monthly payment: $892.00
Time Saved

10 years, 7 months

Monthly Savings

$775.56

Interest Saved

$21,122.25

Don’t wait to get relief from credit card debt. Talk to a certified credit counselor today to find the best way to pay off your balances for your situation.