More Than 1 In 10 Believe They Will Die In Debt


We all incur debt during our lives, but will we ever become debt-free? A significant number of people say no. According to a new survey by Northwestern Mutual, 13% of Americans expect to be in debt until they die.

The Depths of Debt section of Northwestern Mutual’s Planning and Progress Study 2018 contains many other sobering debt statistics. The average debt among debt holders rose to $38,000 in 2018 – even though over half of respondents called debt reduction their top financial priority and approximately 20% of respondents allocate 50% to 100% of their income toward reducing debt.

It’s surprising that more people don’t expect to die with debt. Only 23% of survey respondents had no debt at all, down from 27% in the previous year.

Compare that with the 13% who expect to die in debt. Those figures imply that well over half of Americans expect to climb out of their existing debt and become debt-free before they die.

A 2017 survey by …

3 Of 4 Know Their Credit Score… Do You?


What’s your credit score? If you don’t know, you’re in the minority – according to the Chase Slate 2018 Credit Outlook.

The 2018 survey found that 77% of Americans know their credit score, an increase of ten percentage points in just one year. With that knowledge comes the desire to improve. Four out of five respondents are taking steps to improve their credit score in 2018, up from 72% in 2017. Are you?

Americans overwhelmingly understand the importance of good credit. Approximately 90% of respondents believe that access to credit is important. Similar percentages of respondents understand the importance of credit when it comes to purchasing a home or a car, applying for a loan or a credit card, or even starting a small business.

A poorer credit score can cost many thousands of dollars over a lifetime due to higher interest rates. You can negate this effect on a credit card by…

Video: Seniors, Don’t Worry About Timeshares You Can’t Afford


By Eric Olsen, Executive Director, HELPS
Nonprofit Law Firm

I just got off the phone with a senior couple who have a timeshare they can’t afford and don’t use any longer. They had called a company who advertised that they help people get out of timeshares. (I hear such advertisements on the radio and television regularly.) The senior couple had paid this company nearly $3,000. The next payment of $1,000 was scheduled to come out of their account in a few days. I took a deep breath and explained that they didn’t actually need to keep paying for their timeshare, let alone pay someone to help get out of it. The timeshare company couldn’t take anything from them if they simply stopped paying. The law protects their retirement income from collection – including wage garnishments and bank levies from the timeshare company. That includes Social Security, pensions, VA benefits …

Could Rent Payments Build Your Credit Score?


Not All On-Time Payments Build Credit

You’re fiscally responsible. You pay your credit card bills and your rent on time, every month.

Paying your credit card bill on time is a major factor in raising your credit score. On-time mortgage payments also raise your credit score – but paying rent on time generally has no effect on your credit score.

Why is fiscal responsibility rewarded in one case and not the other?

While all credit card payments are reported to the three major credit bureaus (Experian, Equifax, and TransUnion), most rental payments aren’t. Your credit score is calculated based on the information in your credit report. Payments that aren’t reported can’t be considered – and not all credit-scoring systems take rental payments into account even when they are reported.

Lower-income Americans are hurt the most by this policy, since they’re more likely to be renters and to pay…

Credit Through History


It may seem like you have been paying credit card interest since 3500 BC – but you might be surprised to learn that credit actually dates back to those ancient times.

Historians believe that the Sumerians of ancient Mesopotamia (in modern-day Iraq) extended credit to farmers in the rough equivalent of a consumer loan. The time lag between buying seed and harvesting grains to sell required up-front resources – just as it does today.

The first laws regarding credit were established in Babylon in 1800 BC. The Code of Hammurabi established formal contract rules for loans and caps on interest rates – perhaps an early form of consumer protection. To be enforceable, loans required recording and witnessing by a public official. Interest rate ceilings were high – 33.3% annually on grains and 20% on silver.

The concept of credit and interest continued through the ages, with occasional detours. For example, during Charlemagne’s rule in 768-814 AD, the charging of …

Payday Loans Popular Among Millennials


You need cash to pay an important bill, and you haven’t got it. What do you do?

Many Americans turn to payday loans to fill this gap, even though the interest rates are staggering – an average of nearly 400% APR.

A recent survey by CNBC Make It and Morning Consult found that all generations use payday loans. While 11% of all Americans have taken out a payday loan over the last two years, millennials (22 to 37 years old) and Generation Xers (38 to 53 years old) rely on payday loans the most. Thirteen percent of both generations have taken out payday loans over the past two years, compared to 8% of Generation Z (18 to 21 years old) and 7% of baby boomers (54 to 72 years old).

A disturbing percentage of young Americans have at least considered the idea. Over half of millennials (51%) have considered a payday loan – not…

We Prefer Using Cash Over Credit For Small Purchases


Do you use your credit card for most purchases? Are there times you prefer paying with your debit card? Perhaps you still use those funny green paper rectangles with numbers on them?

Cash hasn’t been forgotten, especially for smaller payments. A new study by shows that 45% of consumers who have rewards credit cards still prefer to use cash for payments below $10. Even debit cards are more popular than credit cards on small payments, by a 30% to 23% margin.

This finding is consistent with previous data from the Federal Reserve’s Diary of Consumer Payment Choice (DCPC). In 2016, the DCPC found that 55% of all payments of $9.99 or less used cash, while cash prevailed for 35% of purchases between $10 and $24.99 but only 19% of purchases from $25 to $49.99. The study agrees, showing that $25 is the median tipping point for using credit for purchases.

Why wouldn’t you use a credit card for all purchases when you get rewards fro…

Your Low Credit Score Could Cost You Thousand$ On Your Car Loan


Your credit score is one of the most important variables that lenders use to assess your risk. A low credit score can disqualify you for an auto loan, or force you to pay higher interest rates – but how much will higher interest rates cost you in the long run? New data from Experian shows just how much a poor credit score can cost you over time.

As of the second quarter of 2018, Experian shows a 5.76% average interest rate for new car loans – not far above the 4.45% average rate for prime borrowers with credit scores between 661 and 780, or the 3.47% average rate of super-prime borrowers with credit scores above 781. Non-prime borrowers with credit scores between 601 and 660 are charged an average 7.55% interest rate for new car loans.

However, the penalty for lower credit scores is significant. Subprime borrowers (501-600 credit score) pay 12.14% interest on average, and deep subprime borrowers (300-500 credit score) pay a whopping 14.93% on average for their au…

1 Of 3 Americans Wants To Buy A Home By 2020


Is a home purchase on your to-do list over the next two years? You’ll have plenty of competition finding your new home, according to the latest PenFed Credit Union National Mortgage Survey.

The survey found that 37% of American adults are planning to purchase a home within the next two years. Over half (52%) of the millennial generation plan to buy within that timeframe, with many looking forward to their first home purchase.

Millennials will need all the resources they can muster to get that starter home. Demand continues to outpace supply, pushing home prices upward and out of reach for an increasing number of Americans. The current home supply increased to 6.2 months, near the 6-month level considered a healthy balance – but affordable starter homes are still in short supply in many markets.

According to the National Association of Realtors (NAR), first-time buyers need nearly 23% of their income to afford the average entry-level home. That’s the hig…