Ability to eliminate debt contributes to financial and emotional well being, according to ASU research study
SAN MATEO, Calif., April 10, 2019 /PRNewswire/ — Consumers who have successfully completed the Freedom Debt Relief® program report that they are significantly more financially capable, have significantly less stress about their finances, and feel significantly better about their personal lives than consumers in similar debt hardship who did not enroll in the program.
In a study conducted for Freedom Debt Relief (FDR) by the L. William Seidman Research Institute, the consultancy arm of the W. P. Carey School of Business at Arizona State University, graduates of the FDR debt settlement program scored 24 percent higher than their counterparts on the Financial Capability Scale (FCS). The survey tool, developed by the University of Wisconsin-Madison’s Center for Financial Security, measures financial capability of individuals. Higher scores indicate more financial capability.
Consumers who completed the FDR program also scored 21 percent lower on the Perceived Stress Scale (PSS). Developed by Sheldon Cohen, Ph.D., professor of psychology at Carnegie Mellon University, the PSS is the most widely used psychological instrument for measuring the perception of stress. Lower scores indicate less stress.
“The study provides comprehensive data on the financial and emotional health of individuals who use our debt settlement program, and the findings establish quantitatively what we’ve observed and understood for quite some time,” says Andrew Housser, co-CEO and co-founder of FDR. “The benefits of getting out of debt go well beyond the financial impact to our clients’ lives. Feeling less stressed about finances, and more in control of one’s financial future, contributes to healthier individuals, families and communities.”
The Seidman Institute surveyed 3,452 people struggling with debt in October 2018. Additional findings include:
- 87% of FDR graduates are confident they could handle an unexpected emergency expense – significantly higher than those who never enrolled.
- 20% of FDR graduates say they have incurred a late fee in the last two months – significantly lower than those who never enrolled.
- 71% of FDR graduates say they have a personal budget or financial plan – significantly higher than those who never enrolled.
- 79% of FDR graduates are confident in being able to make financial decisions – significantly higher than those who never enrolled.
Graduates of the FDR program also reported that they feel less upset by unexpected events, less nervous or stressed, and less unable to control the important things in their lives. The study found that they feel more empowered to make changes to their lives and are actively pursuing their goals. Finally, significantly more program graduates say their personal relationships are strong and healthy, and that they sleep well at night.
“Consumers who successfully complete the debt settlement program offered by Freedom Debt Relief are significantly more financially capable, and have significantly less stress about their finances,” says Timothy James, Ph.D., director of research and consulting at the Seidman Institute. “With the economic difficulties many families in the United States are currently facing, it is important to give consumers a variety of financial tools to improve their financial and emotional well-being.”