July 2012
Nation’s Top Ten Consumer Complaints: Credit/Debt Issues Rank High
July 31, 2012
By Katie Bryan, America Saves Communications Manager
Cars, credit, and home repair and construction once again topped the list of complaints made to state and local consumer protection agencies, according to a survey by the Consumer Federation of America (CFA) and the North American Consumer Protection Investigators (NACPI). Thirty-eight agencies from across the United States provided information about the most common, fastest-growing, and worst complaints they received in 2011.
“The information compiled in the survey helps us as consumer protection agencies follow trends in consumer fraud, educate the public, and share information with each other, which will ultimately assist us in our investigations against fraud,” said Tonya Hetzler, Interim President of NACPI.
Read more: Nation’s Top Ten Consumer Complaints: Credit/Debt Issues Rank High
6 Reasons Why Too Much Debt is Costly
July 30, 2012
By Dylan Tansy, America Saves Intern
If you rely on credit card, you most likely have debt. When talking about debt, many Americans immediately think of mortgages, student loans, and car payments. While these are certainly costly debts, credit card debt is the most common form of debt Americans have today. Americans spend well over $75 billion a year just on credit card interest and fees alone. While many people experience firsthand the stress of constant bills and payments, it is important to understand how else debt can affect you, your life, and your future.
- Compounding interest increases the amount you owe and keeps you in debt longer – Every loan and credit card has an interest rate. The amount you owe will constantly be increasing, and can make you pay thousands more than your original loan. If you have a $3,000 credit card balance at 19.8%, and you pay the required minimum balance of 2% of the balance or $15, whichever is greater, it will take 39 years to pay off the loan. With accumulating interest, you will pay more than $10,000 in interest charges. Check out this website to see the power of compounding interest.
New Survey Finds Many Families Struggle to Make Ends Meet
July 27, 2012
By Katie Bryan, America Saves Communications Manager
The recent recession has left many American families struggling to make ends meet and to save for the future, according to a 60-page report released this week by Consumer Federation of America (CFA) and Certified Financial Planner Board of Standards, Inc. (CFP Board). At the same time, the survey shows that those who have prepared a personal financial plan feel more confident and report more success managing money, savings, and investments than those who have not.
- Nearly two-fifths (38%) of the 1,508 household financial decision-makers surveyed said they live paycheck to paycheck.
- Less than one-third (30%) indicated they felt comfortable financially.
- Only about one-third (34%) think they can afford to retire by age 65.
- Only 31 percent of respondents said they had a comprehensive financial plan, while about two-thirds (65%) indicated they follow a plan for at least one of their savings goals.
Read more: New Survey Finds Many Families Struggle to Make Ends Meet
Jumpstart Your Emergency Savings
The following post comes from the Military Saves Blog. Follow them on Facebook and Twitter.
July 25, 2012
by Lila Quintiliani, AFC, Military Saves Assistant Coordinator
New research published by Bankrate.com last week showed that 58% of Americans don’t have three months of emergency savings while a full 28% of Americans have no savings whatsoever. When times are tough and it’s hard to make ends meet, it’s difficult to see the benefits of saving, but the truth is, an emergency fund can be your lifeline, and the only thing between you and financial ruin. I have seen people go in to perpetual credit card debt because they suddenly had to buy a set of tires.
At Military Saves, our mantra is to Start Small, Think Big, and that’s exactly the way you can approach building up your emergency fund, even if you’re living paycheck to paycheck.
Here are some ways to jumpstart your savings:
Find some extra cash. You may think that your bills take up your entire paycheck, but you probably have *something* you can cut back on to put some extra cash in your pocket. Brew coffee at home instead of buying it on the way to work, pack your lunch instead of eating at the food court. Check out a DVD at the library instead of buying it or renting it. Get creative and find ways to cut back. This past week, I changed our cable package to a lower tier of programming and saved us $20 per month.
Painless Ways to Pay off High Interest Debt
7/24/2012
By Erik Carter, JD, CFP® is a resident financial planner at Financial Finesse, the leading provider of unbiased financial education for employers nationwide, delivered by on-staff CERTIFIED FINANCIAL PLANNER™ professionals. For additional financial tips and insights, follow Financial Finesse on Twitter and become a fan on Facebook.
Are you struggling with credit card debt? If so, you’re not alone. Paying off credit cards and other higher interest debt is one of the most common goals that people try to save for. Unfortunately, having to pay off a large amount of debt with ridiculously high interest rates can make you feel hopeless, especially if your budget is already stretched. But it turns out that you don’t necessarily need to make huge sacrifices to become debt free much sooner than you may have thought was possible.
Let’s take a look at an example. Suppose you have 4 credit cards. One has a balance of $1,800 at 19.8%. The second has a balance of 1,500 at 16.99%. The third has a $1,100 balance at 16.7%. The last has a balance of $1,000 at 5.9%. If you just make the minimum payments, it would take over 30 years to pay all that off! Sounds pretty discouraging for someone on a tight budget, huh?
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