Kentucky Resident Debt Relief

InCharge provides free, nonprofit credit counseling and debt management programs to Kentucky residents. If you live in Kentucky and need help paying off your credit card debt, InCharge can help you.

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The past few years have been “slow growing” for businesses and the economy in the state of Kentucky.

The number of businesses in the state grew by just 0.2% in a five-year stretch ending in 2019, which ranks 47th in the country. The gross state product hit $189.4 billion over that same period, a growth rate of just 1%, which ranked 42nd in the country.

The slow-moving economy really tumbled when the COVID-19 virus hit the U.S. in 2020, driving statewide unemployment numbers to a staggering 16.6% in April. The state recovered nicely, dropping unemployment to 5.6% by the end of the year, but that still left 112,098 Kentuckians out of work.

It also caused an enormous strain on the state’s unemployment insurance fund, pushing it from a $618 million surplus to zero dollars by the end of the year. In fact, the state had to borrow money from the federal government to fund unemployment insurance.

The uneven economy is partly to blame for Kentuckians owing an average of $7,428 in credit card, 27th highest in the country.

Like the rest of the country, Kentuckians are hoping for an economic turnaround in 2021. In the meantime, there are private and government agencies willing to help those struggling with debt.

Debt Relief Options for Kentucky Residents

There are several options in Kentucky for debt relief. The one that is right for you depends on your financial situation. If you’re having a hard time coming to a decision, a free credit counseling session will help you review your options. Here are your options for debt relief in Kentucky:

Debt Management

InCharge Debt Solutions debt management program is one of the best debt-relief solutions for consumers overwhelmed by credit card debt. InCharge counselors work closely with creditors to consolidate credit card debt, lower interest rates and come up with an affordable monthly payment.

InCharge’s goal is to reduce the interest rate you pay on credit card debt. The average credit card interest rates in 2020 are 16%, but InCharge will work with those companies to get those interest rates lowered to around 8%.

InCharge’s debt management program is designed to help consumers pay off credit card debt in 3-to-5 years. However, people in debt will need to commit to a monthly spending budget — and diligently stick to it — in order to eliminate credit card debt in that timeframe.

InCharge will handle the plan, take your monthly payment and spread it out to the creditors in an agreed upon amount. Applicants can apply online or over the phone.

Credit score is not a factor in applying for a debt management program, so even consumers with low credit scores are eligible to join. Applicants must have enough income to be able to pay for basic needs such as housing, food, transportation and medical bills and still have enough money left to put toward their credit card debt.

Here are some other assistance programs available to Kentuckians.

Debt Settlement

Using a debt settlement plan, credit card companies agree to accept a lump-sum payment that is less than what is currently owed. This is an option that can help Kentuckians who are barely meeting the monthly minimum-payment requirements on their credit card bills. This plan can be very beneficial, but it is a risky option because of the negative impact it has on your credit score for seven years.

Debt Consolidation Loans

If your credit score is high enough,  you could receive a low-interest debt consolidation loan. You would use the loan to pay off your high-interest credit card debt. You will still be responsible for paying off the consolidation loan, but you won’t be penalized by the high interest rates that credit card companies charge customers.

Credit Card Debt Forgiveness

Credit Card Debt Forgiveness is a new program offered by a small group of nonprofit credit counseling agencies, including InCharge Debt Solutions. Choosing this option allows consumers to pay 50% to 60% of what is owed over a three-year period.

The difference between this option and traditional debt settlement is that no negotiating is needed. Creditors agree in advance to lower the amount owed. Consumers can be free of credit card debt in 36 months.


Declaring bankruptcy is an option that will wipe out all of your credit card debt, but there are negative effects that come with choosing this route. A bankruptcy settlement will have a bad impact on your credit score for the next 7-10 years and that will certainly make the prospects of buying a home or getting a car loan more difficult in the years come.

DIY Debt Relief

If you like taking on challenges yourself, you can always consider a DIY debt management program. InCharge has set up a debt management template to assist you.

Kentucky Debt Resources

Low-income or working Kentucky residents who are struggling to pay all of their bills can get help through a variety of state assistance programs. Here are some of the services offered to those most in need:

  • Kentucky Transitional Assistance Program: The federally funded program, known as KTAP, provides monetary and medical help to needy families with dependent children. With this program, the children must live with the parents to receive the aid. A family can receive the funding for 60 months in a lifetime.
  • Food Benefits (EBT): This food assistance plan is being offered to families who no longer have access to free or reduced-cost school meals during the COVID-19 pandemic. The plan has been made possible by the Kentucky Cabinet for Health and Family Services Department, the Kentucky Department of Education and the Department for Community Based Services. The funding for the food will be provided through EBT cards.
  • Rent and Housing Assistance for Kentuckians: The Kentucky Housing Corporation can help clients apply for housing assistance throughout Kentucky’s 87 counties. This program has made homeownership possible for 98,000 Kentucky families.
  • Free Legal Aid: The Legal Aid Network of Kentucky offers free legal assistance to military veterans. Legal Aid’s army of lawyers — many of which do pro bono work — help to ensure that “justice for all’’ is more than just a slogan.
  • Unemployment Assistance for Kentuckians: The Kentucky Career Center offers a variety of assistance programs to help Kentucky citizens who have found themselves out of work because of the COVID-19 pandemic or for other reasons. The KY Unemployment One-Time Payment Program was signed into order on Jan. 12. It is offering a one-time payment of $400 to claimants.
  • Assistance with Homelessness and Eviction Notices: Organizations such as the Homeless and Housing Coalition of Kentucky are working to find answers to try and end homelessness across the Commonwealth and create earning opportunities for low-income families. Also, the CDC has declared a state of emergency that prevents families from being evicted from their homes during the pandemic.
  • Help Paying Energy Bills and Utilities: Your local Community Action Agency can offer financial support for utility bills, rent, food assistance, senior support and transportation.
  • Disability Assistance Programs: The Kentucky Government and Medicaid Assistance provides health care for disabled people who meet the financial requirements of the program. Supplemental Security Income offers financial and medical benefits to blind adults and children who have met the income requirements needed.

Kentucky Debt Statistics

While Kentucky continues to rank as one of the nation’s poorest states, the good news is that the Commonwealth’s poverty levels actually have fallen quite a bit in recent years.

Among the state’s 4.4 million residents, some 16.3% of Kentuckians live at or below the poverty line. That’s actually down from 19.4% living in poverty in 2011. Those numbers make Kentucky the nation’s fourth-poorest state, ahead of only Mississippi, Louisiana and New Mexico.

Here is a look at some of the other statistics that play major roles in a large chunk of Kentuckians living with massive amounts of debt.

  • Household debt: The average Kentuckian is $34,910 in debt in 2021. According to the Department of Numbers, Kentucky’s median household income is just $52,295 — $13,475 lower than the national median household income.
  • Mortgage Debt: Kentucky has the fifth-lowest amount of mortgage debt in the nation at $126,310 on average. Only West Virginia, Indiana, Mississippi and Ohio have less mortgage debt per resident.
  • Student Loan debt: The average Kentucky resident owed $32,500 in student debt in 2020, according to org. That same report also shows that 12.9% of the citizens in the Bluegrass State still owe money on their student loans.
  • Credit scores: The average credit score among Kentuckians rose from 692 in 2019 to 698 in 2020. At 698, Kentucky has the nation’s 12th lowest credit score.
  • Identity theft: Kentuckians did a relatively good job of avoiding identity theft in 2020, ranking sixth in the nation in terms of the fewest cases per capita (1 in 32). Just 1,423 Kentuckians were victims of identity theft in 2020.
  • Auto loan debt: With an average auto loan debt of $4,120, Kentucky has one of the lowest automobile debt ratios in the nation.
  • Credit card debt: Kentuckians have the seventh-lowest amount of credit card debt in the nation at $7,154. However, according to a recent study by The Urban Institute, Kentucky is second in the nation in percentage of residents with delinquent debt payments. Some 41.9% of Kentuckians have debts in collections — second nationally only to Nevada’s 47%.
  • Bankruptcy and foreclosures: According to the American Bankruptcy Institute, Kentucky had 10,953 cumulative bankruptcy filings in 2020. That ranked as the 19th most of any state, but it was the ninth-highest total of bankruptcies based on the per capita population of Kentucky. The Bluegrass State was also hit hard with house foreclosures in February (360 filings) and March (410 filings) before the numbers ultimately leveled out for several months and sat at 105 statewide by December.

About The Author

George Morris

In his 40-plus-year newspaper career, George Morris has written about just about everything -- Super Bowls, evangelists, World War II veterans and ordinary people with extraordinary tales. His work has received multiple honors from the Society of Professional Journalists, the Louisiana-Mississippi Associated Press and the Louisiana Press Association. He avoids debt when he can and pays it off quickly when he can't, and he's only too happy to suggest how you might do the same.


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  6. N.A. (ND) 2020 Identity Theft Statistics by State. Retrieved from