DoughMain Financial Literacy Foundation is worried that students will take on more loans, only to re-enter a compromised labor market as a result of the economic damage caused by COVID19 and emerging possibilities of higher taxes and less employment opportunities. Among our concerns is how the 2020 recession might exacerbate the wealth gap since 2008, which diminished homeownership rates for African Americans and led to significant income decline in low-income communities.
We are concerned that the next generation of young adults – especially those without family wealth – will struggle to reach financial independence and materialist milestones, compared to their parents and grandparents. But this delay in independent adulthood could motivate them to re-envision not just their careers, but social and personal priorities differently. The need for quality Personal Finance Education for every kid in every school across America is now more important the ever!
FitKit explores Income and Career goals important to young adults.
Photo by Avery Evans on Unsplash
Did you log into your online banking account to find that you have a negative balance on your credit card? Your heart might have dropped for a moment — how could you have accrued this much debt? What does having a negative credit card balance even mean?
You can relax: having a negative credit card balance is not a bad thing. It does not mean that you owe the bank lots of money — the opposite, in fact.
That said, if you searched the internet for answers thinking that having a negative credit card balance is the same thing as having a negative bank account balance, we’ll discuss both situations and provide you with five pieces of advice to get out of debt.
Why is My Balance Negative?
If you have a legitimate negative credit card balance, that means your credit issuer owes you money. If you had a $100 balance on your statement but received a refund for $300, then your balance would read -$200. You didn’t do anything wrong, and you don’t have to pay up.
Refunds are a common reason why people’s credit card balances become negative (if they’ve paid off their previous statement balances, of course), but it may also happen due to canceled fees, removing fraudulent charges, or another reason. Your balance will return to zero if you contact your issuer and ask for your money back or choose to think of it as a kind of credit card prepayment. Remember, it’s not extra money; it was yours to begin with.
Negative credit card balances don’t affect your credit score. You aren’t earning money, either, but neither will your creditworthiness take a hit.
What if I Owe Money Instead?
If you’ve confused “negative credit card balance” with owing money, here are a few ways to get your bank account positive again: Use a Financial AppDo you have trouble budgeting, or is your financial situation a bit of a mystery? Use a financial app like Mint, PocketGuard, or Peak to create a budget, stick to it, and achieve your financial goals. Some apps allow you to view all of your accounts from one place and keep track of your expenses and spending habits.
If you are good at budgeting, but delays in payroll make you short on cash anyway, you can use Earnin to improve your overall financial health. With Earnin, you can take advantage of the “Tip Yourself” feature, so you remember to save, and you can access up to $500 per pay period before payday (you pay the app back when your paycheck comes in), so you can pay your expenses on time without over-relying on credit.
Apply for a Balance Transfer Consider applying for a balance transfer card with a 0% introductory rate. This measure allows you to transition your debt from one line of credit to another card with a different issuer (though there may be transfer fees, so do the math to make sure your current interest rate isn’t actually less expensive).
Negotiate with Credit IssuersIt never hurts to pick up the phone and just ask. Ask your credit issuer if they are willing to lower your interest rate, or if they are willing to let you switch cards. You might have a chance if you have a history of making your payments on time.
Do this for your bills, too. Many kinds of debt are more negotiable than you think, so call your healthcare provider to reduce medical bills, your insurance company, your internet service, your landlord, and other people if you want to pay less. It never hurts to try because the worst thing they can do is say no.
Pay More than the Minimum Payment Yes, the minimum payment is all you are legally obligated to pay each month — but that doesn’t mean you shouldn’t pay more. Paying the minimum only ensures that you are stuck with your debt longer and thus owe more money over time thanks to interest. Pay whatever you have the budget for so that you can climb out of debt faster.
Prioritize Debts Pay off your loans or debts with the highest interest rates first. Say you have two credit cards, one with 17% APR and another with 15%. Pay off the 17% debt first with as many funds as you have available and make the minimum payment on the other. The former credit card will cost you more money in the long-run due to accruing interest, so prioritize that one and keep up the pace with the second card once your other debt is gone.
Having a negative credit card balance is not bad, but a negative bank account balance definitely is. Either way, don’t panic — you don’t owe money in the first scenario, and there are ways to pay off debt in the latter.
Please note, the material collected in this blog is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or Services.
This article originally appeared on Earnin.
New Jersey Manufacturers Insurance Group sponsored #FitKit Personal Finance course materials for New Hope Solebury High School, Pennsylvania in 2020 supporting their belief in making financial literacy a priority for students.
Thank you NJM Insurance Group for your efforts to empower youth and to be there with them along the way!
The federal income tax almost didn’t make it into law because the Supreme Court initially objected to the fact that it was a direct tax, rather than being apportioned among the states based on population. The 16th amendment to the constitution overrode the Supreme Court’s ruling in 1913 and the direct income tax was born.
You can’t avoid paying taxes. But understanding how taxes work can empower you to make smart choices about managing your finances and getting the highest net income.
A good tax plan can set up your personal finances strategically to take advantage of different tax breaks and tax credits. And this could help reduce how much you owe in taxes.
DoughMain Financial Literacy Foundation is dedicated to helping young adults acquire the skills and understandings necessary to build for a lifetime of financial responsibility and a secure financial future. Understanding personal finances is not easy, nor can it be one of the most engaging areas of study, but having the ability to understand and plan for the future financially can have an incredible impact on a young person’s life. Though the US has focused on financial literacy education, and to date 45 states have adopted standards for Financial Literacy Education, only 24 states require that a personal finance course be offered. We are becoming less financially literate. Based upon our experiences, we believe the following are compelling reasons as to why it is important for schools to teach about personal finance.
1) The lack of “friction” related to the way we purchase and spend. Technology has made it increasingly easy to purchase items and spend money. Without handling it, we seldom think about the consequences related to purchases. In-fact most households overspend their income monthly, creating situations where individuals and families are continually trying to catch up.
2) Student loan debt increasing. Student loan debt has soared from $260 billion in 2004 to over 1.7 trillion last year. The average student takes on more than $35,397 in student loans and maintains student debt well into their 60s. Students who understand the decisions that they are making are more likely to avoid costly debt.
3) Understanding personal finances encourages good savings, investing and financial practices. From youth to adulthood the ability to learn, understand and practice sound financial decision-making skills encourages youth to ask questions, make better decisions and carry those practices on later in life. They are also more apt to share their financial decision-making processes and discuss personal finances with their children.
4) Young adults are filing for bankruptcy. Students start spending sooner, have more debt options, have more debt in general, student loans are costlier, and people are going bankrupt younger. In 2020 more than 1,253,444 million Americans declared bankruptcy according to the American Bankruptcy Institute. This is the fastest growing demographic in bankruptcy cases.
5) Common misunderstandings can lead to serious financial issues later in life. There are many myths when it comes to managing your personal finances. It’s important not to listen to outdated advice or blindly follow rules of thumb. In fact, many experts suggest that the commonly held rule of holding 6 months of income in emergency reserve is incorrect and now encourage holding 9 months in reserve.
6) Understanding of basic skills in personal finance helps to ensure individuals do not become victims. Often during times of financial stress individuals are faced with having to make decisions financially that they lack confidence in, or because they are pressured by creditors. Understanding basic skills helps to avoid these situations and challenges and helps individuals overcome financial inequity.
7) Give yourself options. Understanding personal finances can help to plan and provide for options when faced with making financial decisions, especially during time of financial stress.
8) Planning for today and tomorrow. Understanding basic skills and practices in personal finance helps you to plan for the future and provides you with an understanding of how the financial decisions that you are making today affects you tomorrow.
9) Stabilizing parents and families. Understanding personal finance is an integral part of managing a household, planning for families, and securing futures. Most Americans would not give themselves better than a C in their own personal financial understandings. As husbands, wives and parents it is important to plan responsibly for the day to day, for family growth and for retirement.
10) Financially literate youth become good members of their communities. Financial literacy lays the foundation for the future. Understanding skills in personal finance helps individuals to recognize their dreams, to establish businesses and organizations and to help themselves, their families and others succeed.
By Robert M. Church
While money doesn’t buy happiness, understanding finances is key to owning a home, starting a business, raising happy children, and being independent. When people struggle to understand their personal finance, they struggle to achieve, to live and be successful. By providing personal financial education in high schools and in underserved communities, people can be empowered to be financially fit and achieve a better future. The impact of implementing an engaging, comprehensive personal financial literacy course in high schools is both life-changing and inspiring.
Many schools approach meeting the broad standards covered under financial literacy education with offerings that fail to provide a comprehensive focus on the basic skills needed to manage personal finances. Additionally, support for financial literacy education programs offered by the business and financial services sector as solutions often focus on marketing opportunities and products offered by those entities, not on the needs of the students. Statistics suggest that even with all of the attention given to financial literacy education over the last 9 years, there continues to be a systemic lack of education and understanding of personal finances and a financial illiteracy epidemic that is currently plaguing our country.
#FitKit Programs are inspired curricula created by DoughMain Financial Literacy Foundation (DMFLF), a non-profit dedicated to building a better tomorrow by educating people today, in order to forge a “Financially FIT America”. These comprehensive turn-key personal finance courses are available to schools and empower young adults with the knowledge they need for a lifetime of financial responsibility, growth and prosperity. They teach students the entire spectrum of fiscal topics necessary for success. The #FitKit engages students with the use of video, animation, humor, and social collaboration. Unit topics include: Income and Careers, Pay, Benefits and Deductions, Taxes, Budgeting, Banking, Savings and Investments, Credit, Insurance and more.
Young adults want to learn about money and appreciate the tools #FitKit gives them. Recently a student in Pennsylvania, named Andrew, felt so empowered by the FitKit materials, he spoke to his local Board of Education about it. He credits the FitKit course that was available to him in high school for preparing him for adulthood. “The course material is well rounded and easy to comprehend. In just five months, I was able to build a foundation in investing, budgeting, debt and taxes.” He continues to be a vocal promoter of FitKit in his local community.
Teachers see the ripple effects of financial literacy in families and communities too. While teaching the FitKit to his high school class, Chris gave his students an assignment that involved speaking to their parents about the family budget. When he got a call from one of the parents the next day, he braced himself for a complaint, but instead received a call of gratitude. “The parents said it was the first time their son ever asked about budgeting and has a new appreciation for how hard his parents struggle to provide for him. With financial literacy, Chris’s student can finally understand his parent’s reasons for denying luxuries such as expensive sneakers and video games.” What used to be a constant source of conflict is now an informed conversation.
Teaching people early in life to understand basic financial concepts helps them take personal responsibility for their futures, it follows that successful stable citizens make for a successful and stable economy, so it’s important for us as parents to ask what efforts are schools are making to teach students about personal finance?
DoughMain Financial Literacy Foundation is a non-profit organization that relies on generous donors and volunteers who share the vision of giving a new generation the tools they need to be financially responsible and prosperous. If you want to offer your support with a tax-deductible gift, find out how you can sponsor a #FitKit in your school or community.
DoughMain Financial Literacy Foundation believes its important for students to choose the right bank when considering checking and savings accounts. The FitKit Personal Finance 60 hour program for schools covers Banks and Banking in Unit 5. Peer-to-Peer video contributor Damali shares some important factors to consider when choosing a student checking account. #getfinlit
Comprehensive #PersonalFinance education for #youth is more important now than ever. The FitKit™ Personal Finance eLearning course platform is preparing to launch this spring. With introductory costs as little as $6.00 per user per month. Our online interactive classroom includes such key features as:
- Curricula designed by educators for real-world application
- Background information for students and teachers
- Teaching tools
- Peer-to-peer videos
- PowerPoint presentations
To explore subscriptions, co-branding or #FitKit™ sponsorship opportunities for schools, or to custom craft a FitKit™ Express community program please contact us at email@example.com
Let's work together to prepare today's students for a lifetime of financial responsibility!
Avoiding Delayed Maintenance: Home Maintenance and Repair Tips
Failing to maintain your home could create a money pit that you may never be able to fill once the situation spirals out of control. While delayed maintenance could solve your short-term money and time constraints, it could also reduce the value of your property when you attempt to sell it in the future.
Delayed maintenance, the practice of postponing small and large repairs, can be avoided. This article identifies home maintenance and repair tips that will ensure that your home will always be in a good state of repair. It answers some common questions about home maintenance, such as the cost of some common home repairs and how you can best track maintenance and repairs in your home.
We end the article by looking at how a home warranty can be the solution for homeowners who find themselves having to defer maintenance because of a shortage of funds.
How Do I Handle the Most Common Home Repairs?
Most of the maintenance problems that end up becoming colossal problems start as small issues. Also, most maintenance issues can be avoided if you follow some easy tips to ensure that they do not happen in the first place. Let’s look at some of the common problems and how you can handle them.
What's In This Guide?
Suppose you have ever had the water heater stop working on a cold January morning. In that case, you will understand the importance of ensuring that the water heater is well maintained.
Some small signs can show that something is not right with your water heater. These include leaks or strange noises. When you feel that the heater is no longer working as it did before, there is probably something wrong with it.
The best way to deal with a water heater is to start by reading the manufacturer’s maintenance instructions. Get the heater looked at by a professional at the intervals stipulated by the manufacturer. As soon as you see a leak, or hear unusual noises from the heater, call a professional to look at it.
Peeling Paint and Dry Wall Cracks
You start by ignoring that part of the peeling wall, which you hope nobody is noticing until you end up with a house that looks like it is falling apart from the ceilings to the walls. Once walls start to peel and show signs of disintegrating, you should know that you may not have been attending to maintenance as well as you should have.
It’s essential to have a schedule regarding when your home needs a fresh coat of paint. Most paint manufactures will tell you how long the paint will last before you need to re-paint. Painting is one of the easy jobs that you could do for yourself.
Cracks on walls need to be appropriately filled before painting over them. This may take more time and money initially, but it will save you much work and money later on.
Leaky Roofs or Walls
You look at your ceiling and see a part that looks like it was once wet, and you know there may be a leak on your roof. If you ignore this, you do at your own peril. Most of the time, the hardest part is to find the place in the roof that is leaking. Repairing the leak is usually straightforward.
Finding the leak is something you are better off leaving to the professionals. This is because a leak can either be on the roof or in other parts of the building. Attempting to deal with this issue using stopgap measures would usually leave you more frustrated because it doesn’t usually deal with the underlying problem.
Leaking or Burst Pipes
Pipes that carry water are under much pressure most of the time. This is why burst water pipes are some of the most common maintenance issues in the home. This is especially the issue in areas that get so cold that the water in the pipes freezes.
One of the most common repairs in the home is fixing a faucet washer. Even though some people will ignore water slowly dripping off the tap in one room, the Environmental Protection Agency (EPA) estimates that about 11,000 gallons of water are lost every year in the U.S. due to drips and leaks. For a homeowner, leaks and drips can result in a massive bill while also damaging other parts of the house.
Once a pipe has burst, the first thing you should do is close the main water supply into the property; therefore, it’s always important to know where this is. Also, keep the contact details of plumbers in your area where you can easily access them so that you can get assistance as soon as possible.
How Much Do Common Home Repairs Cost?
One of the reasons you need to attend to home repairs when they are still minor is that significant home repairs are expensive and require labor, professional expertise, and permits (in some cases). In contrast, minor home repairs can be done with the minimum and basic knowledge of the homeowner.
The cost of the most common home repairs will depend on several factors. These include the area where you live, materials needed, the availability of people with skills, the extent of the damage, and whether the repair is an emergency or not. Of course, it’s never possible to get an exact cost because situations differ.
Here are a few estimates:
Roof repair: Will cost an average of $550. You will pay between $5,372 and $10,968 depending on where you are and the material you use if the repair involves installing a new roof.
Water heater repair: Will set you back between $218 and $936 on average per job.
Peeling paint repair: Can cost a homeowner between $0.90 and $2.20 per square foot.
Drywall cracks: Can cost a homeowner back between $150 and $325 for the smaller repairs, while water damage could cost between $220 and $380 to repair.
Leaking or burst pipes repairs: Smaller jobs can cost between $125 and $350, while bigger jobs will cost between $500 and $800.
How Do I Minimize the Need for Repairs?
By now, it should be clear that when a home is left to disintegrate, more things will need to be repaired at the same time. There are a few actions you can take to minimize the need for repairs, including the following.
The AARP, an organization that helps Americans aged 50 and above to improve their quality of life, has a helpful page on avoiding costly home repairs and how much you could save.
How Do I Track Home Maintenance and Repairs?
It could be a daunting task keeping track of maintenance schedules and repairs as they all have different recommended inspection periods. We look at different ways homeowners can keep track of these repairs and maintenance:
Apps: Various mobile apps help homeowners keep track of different maintenance schedules, vendors that offer these services, and stores where maintenance tools and materials can be ordered. Examples include Angie’s List, Maintenance Reminder, Builder trend, and TaskRabbit.
Maintenance manual/home report: Is a file for home system and appliance instructions, maintenance records, and all home warranty information.
Maintenance checklist: This checklist will list the required maintenance tasks for each system on a monthly, yearly, or biennial basis. It also includes the required materials to carry out the maintenance or repairs, their cost, and the cost of professional labor. See the annual home maintenance checklist provided by The New York Times here.
How Do I Improve My DIY Maintenance Skills?
To ensure that you can deal with home maintenance issues as they emerge and before they become huge issues, you will need to gain some simple DIY skills. Here are a few tips on how you can do that:
Start small: Tasks like the clearing of drainages or checking the rollers of your sliding doors when they come off the hinges are the first steps in your DIY journey.
Research: For more complicated tasks, you can find instructions, books, and videos, search the internet, or ask friends and neighbors to show you how they attend to these repairs. Homeowners can take DIY home repair classes at the local hardware stores.
Observe: Whenever you call a professional for a routine maintenance check or repair, you can observe while they work so that you can learn and carry out home maintenance tasks.
Volunteer: By volunteering in home improvement projects in the community, you can learn advanced maintenance skills like landscaping, plumbing, and electrical repairs.
DIY vs. Professional Home Maintenance
Even though the thought of doing DIY home maintenance can be enticing for the homeowner that wants to save money, not all home maintenance jobs are DIY. But how do you determine
Whether to call a professional or to do the job yourself?
If you don’t have the skill, then you’re not qualified to do the job. If you do the job yourself, you could get injured, harm others, or make the problem worse.
Ask yourself a few questions before you decide to do DIY maintenance. Am I physically up to the task? Will the job look like it was done by a professional? Will I be able to correct things if the repair becomes a disaster? Is it legal for me to do the repair? Do I have the right tools and protective equipment? If the answer is no to any of the questions above, you need to find a professional.
Home Warranty Cost vs. DIY Repairs
One of the main factors that make homeowners either delay maintenance or choose DIY is to save money and time. But do you know that a home warranty can ensure that you can maintain some systems and appliances in your home, find the best professionals, and never have to worry about costly repairs that need to be done when finances are tight?
What is a Home Warranty?
A home warranty is a contract that covers the maintenance of household systems and appliances for a certain period. A home warranty is not home insurance (that covers the loss of a home and the contents in it). It usually covers specified costs, with the homeowner paying a specified amount whenever an item is serviced.
Costs covered by a home warranty can include replacing major kitchen appliances and repairs to plumbing, heating, air-conditioning, and electrical systems. Usually, the warranty will not cover home structural features like doors and windows.
How Much Does a Home Warranty Cost?
A home warranty can cost between $400 and $800 a year, while service fees can be between $75 and $125 every time a technician is dispatched to your home. Home warranty premiums can be paid monthly or annually, and some companies require a one-time enrollment fee.
Can Home Warranties Save Me Money?
Suppose one considers that repairing a water heater could cost over $900, while a home warranty covering more than 35 items could cost up to $800 a year. In that case, you will notice that a home warranty can save you money. For argument’s sake, let’s say that you need to repair or replace three appliances in a year. These appliances are likely to cost a lot more than you may have paid for your home warranty in a given period.
With a home warranty, the homeowner manages to get home maintenance services without finding a lump sum at a specific time. Also, the technicians provided by the home warranty are usually trusted and vetted. You can expect excellent quality and easy ways of complaining if you are not satisfied with the service.
A disadvantage to the home warranty option is that you pay your premiums even when no repair is carried out; however, these things often balance themselves. When something needs to be replaced, you will notice that it may cost more than all the premiums and the service fees you have paid.