Archive for May, 2012

BLUE VS. RED: Which States Have Better Credit Scores?

Posted on May 31, 2012 by Saldutti

In a credit score race, blue states win.  Credit Karma, which offers free credit scores and scoring information, reports that residents in red states on average have lower credit scores than their blue-state cousins.  The average score among Republican-leaning red states is 651, compared with 667 among Democrat friendly blue states, according to Credit Karma.  Overall: Blue states ahead by 16 points. “It’s significant,” says John Ulzheimer of SmartCredit.com. In credit scores ranging between 600 and 700 points, the difference of 5 or more points can have a big impact on the terms a creditor offers to a consumer.  A…

Money Mistakes Everyone Makes

Posted on May 30, 2012 by Saldutti

Jack Otter, author of Worth It…Not Worth It?, explains half a dozen screwups we all fall for—and strategies to avoid them.    #1: You Used Your Debit Card to Pay for Gas, an Appliance, a Rental Car, Reserve a Hotel Room or Anything Online – Buy a coffee at Starbucks with a debit card and $2.01 will be deducted from your checking account–end of story. But fill up your car for $30 and the gas station might put an $80 “hold” on your checking account for a couple of days until the station reconciles its accounts and transmits your purchase to…

What's Keeping You Poor?

Posted on May 24, 2012 by Saldutti

Blowing money on one-time, unplanned expenses is the real reason we can’t stick to a budget and spiral deeper in debt, according to a new paper, “The Exception Is The Rule: Underestimating and Overspending on Exceptional Expenses.”  Think about it: How often do you plan for unexpected events?  Most Americans don’t have $2,000 shored up for financial emergencies, so when they go overboard on date night dresses and root canals, clearly they’re setting themselves up to live check to check. No planning = no budget = no savings.  “Chronically underaccounting for these expenses can cause consequential errors in financial planning, resulting…

Student Loans for Kindergarteners on the Rise

Posted on May 22, 2012 by Saldutti

It used to be that families first signed up for education loans when their child enrolled in college, but a growing number of parents are seeking tuition assistance as soon as kindergarten. Though data is scarce, private school experts and the small number of lenders who provide loans for kindergarten through 12th grade say pre-college loans are becoming more popular.  Demand for the upcoming year is already up: This month, the total dollar amount of loans families requested rose 10% compared to a year ago.  Much of this demand is coming from high-income families. Roughly 20% of families that applied…

Sizing up Student Loan Debt

Posted on May 17, 2012 by Saldutti

There is a lot of student loan debt out there, we’re constantly told. Many graduates can’t keep up with their student loan payments, even if they are lucky enough to have a job. And this, of course, leads to default.  So we know there is a lot of student loan debt out there and a lot of it goes into default. But just how much is there?  According to the Federal Reserve Bank of New York (FRBNY), at the end of the third quarter 2011, there was about $870 billion in outstanding student loan debt. That’s more than credit cards…

Weird Ways to Hurt Your Credit Score

Posted on May 15, 2012 by Saldutti

The FICO credit score equation might be a black box, but there have been thousands of articles written about what you should and shouldn’t do when it comes to your credit score. Most of them are pretty obvious–pay your credit card bills on time, don’t apply for a lot of credit, and keep your nose clean. There are, however, a lot of weird ways you can hurt your score without you even realizing it.  U.S. News & World Report outlines them here: Closing Credit Cards – This has become less “strange” in recent years, but closing your credit cards can…

More Young Adults Living With Mom and Dad

Posted on May 10, 2012 by Saldutti

Shame, misery, and your mother’s incessant nagging used to be associated with moving back in with your parents after college or being out on your own for awhile. Nowadays, thanks to a weak job market that forced many young Americans to return to the nest, that stigma is fading. According to a new Pew Research Center study, more than 75% of young adults who moved back home during the Great Recession and its aftermath (the boomerang generation) say they’re OK living at home with their folks and are optimistic about their future financial prospects.  One reason young adults might feel…

What's the Value of a College Degree?

Posted on May 06, 2012 by Saldutti

How much is that college degree really worth? That depends on your major. It turns out that some undergraduate and graduate diplomas are worth a lot more during a lifetime of work.  In fact, the difference in earnings between one major and another can be more than 300 percent, according to recent research from Georgetown University’s Center on Education and the Workforce. Researchers there crunched U.S. Census data looking at 171 majors in 15 categories.  Anthony Carnevale, the center’s director, explains why students need to pay attention to their earnings potential when picking a major. Why is it important to…