Tips for Successful Personal Finances
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I’m a big fan of Leslie Marshall She’s been on radio and TV as a host, a guest, a political pundit and even as an actress! Leslie Marshall is multi-talented and kind enough to give me the opportunity to be on nationally syndicated radio Please join us by tuning in!
Last week, I told you how to identify a true credit score. Today, I will be telling you what is on your credit report.
Your credit report is a reflection of your financial life Which credit accounts you have, how much credit you have available to use, how you have used, how you make your payments, and any other information that is relevant.
If you have a credit card (notice, I didn’t say debit card) with a bank, this is what it might say:
(Your name) has a credit card with ABC Bank with the account number xxxxxxx-xx and owes $1,248 with available credit of $5,000 The minimum payment is $45 The account was opened 11/02 and the payments are C, C, C, C, -, C
What does that mean? The letter C means that the account was made “current” each month, which means your payment was made on time The dash means no payment was due that month This is a great entry for anyone’s credit report.
Here is another example of an entry on a credit report:
John Doe has a credit card with ABC Bank with the account number xxxxxxx-xx and owes $4,559 with available credit of $5,000 The minimum payment is $65 The account was opened 11/09 and the payments are 2, 3, 3, 3
What does that mean? It means that John Doe is not paying his account on time A 2 means he was 60 days past due and a 3 means he was 90 days past due (A 1 would be 30 days past due.) Do you see the pattern?
John Doe will have a harder time getting another loan or credit card with good terms Credit reports weren’t created to help you and I, they were created to help creditors decide whether to lend someone money Yes, you can look at your credit report, but almost anyone you do business with can run a credit check on you as well That includes landlords, employers, banks, loan companies and insurance companies.
A great credit report entry can help you, but a late payment account can hurt you A history of late payments will tell businesses that you don’t pay your obligations in a timely manner This is definitely something that you want to avoid.
Next week, learn what’s not on your credit report.
BY Jean Chatzky
Monday, August 23, 2010, 4:00 AM
Original Article Link in the New York Daily news
PDF Version
Back to school season in my house, and likely in yours, means a long to-do list. Stock up on school supplies and clothes. Organize binders. Send everyone to bed a little bit earlier. I know: You’re busy.
But this year I want you to add one more thing to your list: I want you to talk to your kids about money. Many parents are intimidated, yet what you need to teach them is not something they’re likely to learn in school.
“Parents tend to feel that they’re not comfortable with the information, that they don’t have enough expertise or that they themselves have made mistakes,” said Laura Levine, executive director of the Jump$tart Coalition for Personal Financial Literacy in Washington. “But it’s important to understand that kids really do see them as a primary source of information about money.”
When it comes to teaching your kids about money — just like when you’re helping them study for a test — you can’t expect to know it all. I don’t, nor do I pretend to. When one of my kids asks me a question that I don’t have the answer to, we look it up together and discuss what we find. It’s so much better than putting the discussion off altogether because the earlier we start teaching our kids financial basics, the less likely they are to fall into traps.
To encourage people to talk, I’ve joined with American Express to create resources for the first National Money Night Talk, set for Sept. 16.
To take part, parents pledge to talk to their kids about saving, budgeting, credit cards and credit scores. Visit moneynighttalk.com for free tool kits I created to give you the talking points, questions, answers and exercises you and your kids can do together. There’s one for middle school-aged kids, another for high schoolers and another for college students.
Here are a few key concepts to keep in mind when you have your talk.
HOW MUCH TO SHARE
A reason many parents shy away from a big money discussion is that they don’t want to share their own financial information — salaries, debts — with their kids. That’s okay, you don’t have to, but you also don’t want to send the message that money shouldn’t be discussed, said Jill Russo Foster, author of “Cash, Credit and Your Finances: The Teen Years.”
“I’ve taught classes and asked how many kids know if their parents own or rent their home. If they don’t know, I send the question home and I’ve had parents who wouldn’t answer. I’m not asking you to tell them how much you make each week, but this is a basic question,” Foster said.
I like real-life examples, but it’s okay to pick ones that aren’t so personal. Kids want to know how much it will cost to live on their own. Pick ones you feel comfortable discussing: How much you spend on groceries each week, the phone bill, the cost of a MetroCard and the percentage of your salary you try to save.
THE GREAT RECESSION
Today’s teens know they’re experiencing tough times. Maybe a parent or a friend’s mom or dad lost their job, or there were foreclosures in the neighborhood. They may be wondering about the impact on you and your family but have been reluctant to ask.
This is a good way to work in lessons about living within your means, saving money and creating an emergency fund in case of a layoff, unexpected expense or emergency.
SET AN EXAMPLE
This year, try a different approach to your back-to-school spending: Tell your kids you’ll be spending a set amount of money. (Decide how much you can afford before the talk.)
Together, make a list of what you need to buy. Then pick a day to go shopping and let them budget their money.
If they pick out a pair of $100 sneakers, help them figure out what they still need to purchase — and whether they can afford the pricey kicks.
Your Money columnist Jean Chatzky is financial editor of NBC‘s “Today” show, a contributor to “The Oprah Winfrey Show” and the author of seven books, including, “Money 911: Your Most Pressing Money Questions Answered, Your Money Emergencies Solved.” Check out her blog and learn about her Debt Diet Online at jeanchatzky.com.
How do you know if you are getting your correct credit score? This is a dilemma for many people.
Fair Isaac and Company, known as FICO, is what the lenders and creditor use when you apply for credit This is one of the factors that you are judged as creditworthy or not A while back, people tried to introduce a new credit scoring system That wasn’t successful in over taking FICO as far as lenders where concerned.
But when you as a consumer want to know your credit score, you may be getting something totally different Many companies, including the credit bureaus may be selling you a score calculated differently and on a different scale than FICO FICO uses a scale that tops out at 850 If you have a score of 760 or higher, you have an A+ FICO score With others use scales that go well into the 900’s, that 760 or above score isn’t A+ like you are thinking You would be considered a B You see how this is confusing.
To top it off, when you order your FREE credit report form www.AnnualCreditReport.com, you don’t get your credit score To get your FICO credit score, you will need to go to www.MyFICO.com and pay a fee to see your credit score Remember that each of the three credit bureaus, have a score and they are not necessarily the same number at each.
With all of us using social media (Facebook, Twitter) etc, what should you post and not post? Like many, I use many different social media outlets, but I am careful as to what I post If you are an active user, you probably have friends that you know well and others you have never met You have no idea who they are or what their purpose is.
You have to be the one that thinks about what you post or when you post it for everyone to see I am not a fan of the instant location options in social media You don’t need everyone to know exactly where you are and what you’re doing ahead of time.
Never post that your whereabouts before you go out That lets everyone know that you are away In addition, your empty home might be the perfect opportunity to be robbed or someone may be stalking you How about posting your information and vacation pictures after the fact? Not everyone using social media is there for honest purposes.
Bottom line, think about what you are saying and who might be reading it and the possible repercussions before you post your next message.
I have been double checking my personal information and making sure that I have opted out with the companies I am dealing with That got me thinking about what happens to my information when a company closes.
So I started to do some research and don’t seem to find any answers I wanted When a company is open and they have your personal non-public information on file (name, address, account number, checking account number etc) most companies are required to comply with the Gramm Leach Bliley Act to protect your personal information They are required to disclose to you what they do with your personal non-public information Then you have the right to opt out so that they don’t share your information with non-affiliated third parties.
With that said, what happens when that company closes? Not much Recently a company that had your personal non-public information on file to expedite you clearing airport security closed There don’t appear to be any requirements of what to do with all the information they have on file.
At this point, the only thing you can do is to check your credit report and accounts on a regular basis to give yourself piece of mind.
In these challenging economic times and with technology being readily available, counterfeit money is in circulation In 2008, $64.4 million was in the US economy.
How to check if your bills are real? According to the US Secret Service, you should be looking for the differences between the same denominations of bills Check the portrait, the Federal Reserve and Treasury seals, border, serial number and the paper If you think the money is not real, refuse to accept it Ask for another bill If the bill is real, the person who has possession can easily exchange it at their bank.
Older bills, before 1996 are still in circulation and do NOT have these new security features and therefore may seem counterfeit to you Older bills are harder to detect Again, you simply refuse to accept them when receiving money.
Counterfeit bills are out there everywhere The person who possesses the counterfeit money is the person who loses So if you accept counterfeit bills and attempt to use them, it’s your loss (regardless of where you got them from) Check your change before you accept it to be safe.
Just like the changes to the credit card rules back in February, July 1 started one big change to your checking account If you overdraw your checking account with a debit card transaction, your charge will be declined That’s the change If you are someone who keeps detailed records and knows what you have in your checking account this won’t affect you If you cut it close and it happens to you, you are in for a change Your transaction will be declined and you may be embarrassed at the register.
In the past, the banks were more than happy to let you overdraw your account They would receive the overdraft charge of $30 plus dollars This was a big revenue source for banks With this change, banks are offering you another option of overdraft protection This is associated with your checking account If you spend more than you have, you will be using the bank’s money as a loan to cover the additional amount needed You will have to repay the loan amount plus additional interest charges as incurred.
Know how much you have available in your checking account before you make a purchase and you will be fine.
Now that summer is here and school is just about out, people start to think fun and sun and for many of us, vacations Summer is prime vacation season, and while you’re anticipating the excitement of getting away from it all, you should also anticipate a little extra upfront work to help make your vacation worry-free.
To help prepare for your family’s vacation, I wanted to share with you a few tips to offer you some peace of mind while you’re away:
Hope these tips will help you have a great vacation!
This is the second part of streamlining the interruptions in your life.
As of January 1, 2005, the Do Not Call list went in to effect Adding your phone number(s) to the list prohibits companies with who you do NOT have a direct relationship (non-profits and political organizations are exempt) from contacting you for solicitation purposes You can register your telephone number(s) (cell phones too) so that unwanted calls are substantially reduced To register your phone numbers go to www.DoNotCall.gov or call 800-382-1222 Registration takes 31 days to take effect and numbers remain on the list for 5 years, at which time you should re-register So if you registered when the law started, it’s time to re-register.
Also in 2005, the Junk Fax Protection Act was enacted Each fax should include the option for you to remove yourself from that companies fax list, by providing you with a toll free number to call to get your number removed from their list.
Sometimes after all your efforts, you continue to receive unwanted communications, and you have made it clear to the company that you do not wish to be contacted and you have no relationship with them or a sister company and you continue to get contacted, you have the option of reporting the company to their regulatory agency For example, for calls and faxes contact the FTC to file a complaint.
The system is not perfect, but I personally have eliminated most unwanted mail, calls and faxes.