According to a study from the Urban Institute, an estimated 1 in 3 adults, or around 77 million people, are so far behind on their debt that their account has been placed in collections.
“Being indebted is like being in shackles, or like wearing one of those cartoon ball and chains. And that can be not just a financial obligation, but an emotional or intellectual obligation as well, because it’s hanging over you," consumer columnist David Lazarus say. "It’s coloring virtually every decision you’re making in life.”
And it also takes a toll on your credit score, too. That could make an impact down the line. “If your credit score takes a hammering. Any future borrowing you’re doing is going to be at a much higher interest, if you can get the loan. More over, if you get a black mark on your credit score, it can take about 7 years to get that off.”
But, as David Lazarus notes, the worst thing you can do is ignore the calls. Instead, be aggressive, and "a key thing to remember for consumers is you have rights," Lazarus says. Debt collectors can't harass or abuse you, they can't call you early in the morning or late at night, and they can't threaten to imprison you.
You should also keep in mind that past due debt carries a statute of limitations, depending on your state. “It doesn't mean the debt goes away," Lazarus says, "they can still keep trying to collect, but they can’t take you to court. They can’t sue you”