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Posts Tagged ‘Financial Literacy’

Saturday, March 20th, 2010

Financial Keys to 2010

With credit scores, student loans, mortgages, credit card debt, car loans, bank accounts, retirement funds and everything else you have to worry about to keep up with your finances, it’s no wonder if you feel overwhelmed from time to time.

Luckily, the General Services Administration’s Office of Citizen Services publishes a Consumer Handbook for American citizens every year – and, as a taxpaying consumer in the U.S., the book is absolutely free to you. Order your copy at http://www.consumeraction.gov/.

Financial Help at Your Fingertips

If you don't have the time to sort through everything in the 172-page book, here’s a brief look at what this year’s handbook offers:

  • Sample complaint letter: The one-page template can serve as a guide when you feel moved to lodge a complaint against those you suspect of unfair or fraudulent practices.
  • Corporate consumer office contact information: This section details how to get in touch with organizations and outfits designed specifically to help with whatever concerns or problems you have.
  • Car manufacturers and resolution programs: Car questions? This section lists the digits for every manufacturer included in the handbook.
  • State government resources: When you need information about local laws or other pertinent information specific to your state or region, this section is the place to turn: it has contact details for non-national government entities.
  • Banking: Need help figuring out your account, opening a new account or adapting your saving strategy? Take a look at this section, where you’ll find information for State Banking Authorities.
  • Insurance: Unsure where to turn for coverage? Unsure whether you need more insurance? Check out this section, which will give you contact options for State Insurance Regulators.
  • Securities: Contact information for State Securities Administrators is offered here.
  • Utilities: Need to know more about your utility bills and options for getting power and water in your home? This section lists State Utility Commissions and how to contact them. If you need utility bill debt relief, while this section may help, you may also want to consider bankruptcy.
  • Federal agencies: Maybe you’re not sure whether there’s a government entity that can help with what ails you. Check out this section for listings.
  • Better Business Bureaus: This section lists the BBBs you may need to contact with consumer complaints or concerns.
  • Consumer organizations: Turn here to find out which groups are working to help you – and contact them to see how you can offer assistance.
  • Trade Associations: This section offers listings for Trade and Professional Associations mentioned in the handbook.

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Saturday, November 21st, 2009

Obama Administration Creates Task Force to Fight Financial Fraud

The White House announced in a press release on November 17th that President Obama has made an executive order to create a Financial Fraud Enforcement Task Force. Part of the reason for the executive order, it seems, is the number and complicated nature of various financial fraud cases related to the current economic crisis.

Sources indicate that the goals of the force are to prevent abuses in the financial sector that could lead to economic turmoil in the future as well as to bring to justice those responsible for the current state of affairs. This task force will reportedly replace the Corporate Fraud Task Force implemented by the Bush administration after the scandal at the Enron Corporation.

The following groups will fall under the wing of the task force:

  • Mortgage lenders & modifiers: Groups responsible for initiating and altering the terms of home loans, much maligned for their role in the current crisis, will be under the task force’s watchful eye.
  • Securities law: This is the branch of law that regulates money, stocks and bonds.
  • Stimulus spending: Government funds intended to perk up the economy, too, will be overseen by this group.
  • Government bailout of the financial sector: This especially controversial bailout has been identified specifically as a target for the task force.

Too Much Fraud?

In recent years, growth and innovation in the financial sector (including such innovations as subprime mortgages) have proven to be more than the Securities and Exchange Commission (which is responsible for regulating stocks, bonds and the like) can handle.

And reports indicate that, despite concerns about national security, officials in the FBI and Department of Justice have been shifting resources away from terrorism cases and to financial fraud cases.

The hope, apparently, is that this group will form a more specialized unit, able to deal exclusively with cases of financial fraud.

The Next 30 Days

The Task Force will reportedly hold its initial meeting within the next month. Headed by Justice Department officials, it’s supposed to include help from the Department of Treasury, Department of Housing and Urban Development and the Securities and Exchange Commission, among others.

Geithner: Beyond Prosecution

Treasury Secretary Timothy Geithner has been quoted as asserting that prosecuting fraud cases after the fact is not workable; he apparently sees the Task Force as a comprehensive reform for financial oversight.

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Saturday, July 4th, 2009

Financial Literacy Fund on the Horizon?

One potentially positive side effect of the real estate market’s crash and subsequent (ongoing) economic recession was a call to arms for promoting financial literacy among American children and adults.

Many of the “exotic” mortgage products and predatory lending strategies that allowed Americans of all income levels to overextend themselves on credit could only succeed in a culture where only those who work in the financial industry have adequate understanding of how the financial system works.

Money Smarts Lacking in the U.S.

If you’re like most Americans, you aren’t as financially savvy as you could be:

  • Average scores on financial literacy tests administered to school-age children have dropped steadily over the years, with 62 percent failing in 2006.
  • Surveys show that as many as 21 percent of 18- and 19-year olds have at least one credit card.
  • Young adults (aged 18 – 24) spend about 30 percent of their income on repaying debt, three times the recommended 10 percent for this purpose.
  • About one in five American households is “unbanked,” meaning that they do not keep their money in a standard, federally insured financial institution.
  • Of households that carry revolving debt (such as credit card debt), the average amount is between $10,000 and $12,000 – and this doesn’t even take into account debt from mortgages, car loans, etc.

And, while these numbers are upsetting in themselves, they’re even more disturbing when considered in context: if almost nobody understands financial matters, who is expected to teach us?

Proposed Bill Would Fund Financial Literacy Education

While the current state of the economy means headaches for most of us, it also means our legislators are taking action to make things better.

According to a press release, Senator Kay Hagan (D – N.C.) has proposed a bill that would provide funding to states that include financial literacy educational programs for sixth to twelfth graders.

According to the release, the bill would:

  • Require that 80 percent of money be funneled to student instruction
  • Allow the remaining 20 percent of funds to go toward professional and curriculum development

The bill is currently beginning its path through the Health, Education, Labor and Pensions committee of the Senate – consider contacting your senator if it interests you.

--We also have filing bankruptcy information at www.TotalBankruptcy.com

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Wednesday, May 27th, 2009

Disney Hops on Financial Literacy Train

Disney has teamed up with T. Rowe Price to create an exhibit that helps kids (ages 8 – 14) develop basic financial literacy skills – because we all know how much fun diversifying our portfolios can be.

The exhibit, which is located in Epcot, reportedly allows kids to earn currency for their piggy banks through games. The various “levels” require players to engage in increasingly sophisticated thinking and decision-making.

The exhibit includes interactive games that are designed to show techniques for:

  • Setting financial goals: Players begin by choosing a real-life event they’d like to save their video coins for.
  • Saving money: One game lets kids choose between guiding falling coins toward “savings” or “spending” buckets.
  • Spending wisely: At the game’s end, kids learn that too much spending translates into not meeting their financial goals.
  • Diversifying investments: Yes, Disney has tackled this issue, albeit at a kid-friendly level. Players must hide their coins in various locations so the game’s villain (a wolf to the hero’s pig) cannot find them.
  • Avoiding inflation: To impart this lesson, players must manipulate levers to keep the wolf (presumably appropriately big and bad) from devaluing their saved currency.

There's no word yet on whether they'll include a special section on bankruptcy.

Playing Online

Besides the Florida exhibit, Disney has launched the Great Piggy Bank Adventure Game on the Internet for non-travelling families to enjoy.

Can All These Games Really Help?

It’s certainly debatable whether getting really good at a video game about saving money will translate into any real-life financial literacy, Disney’s informational/promotional Web site (innoventions.disney.com) points out that the experience might “inspire families to discuss financial planning” and otherwise launch more broad financial literacy activities.

And it’s never too early to start teaching your kids about how to manage money.

For Older Kids: Good News

Obama signed the Credit Accountability Responsibility and Disclosure Act of 2009 (aka the Credit Cardholders’ Bill of Rights) into law May 22nd, and one of its new protections if for young adults (that is, under 21) with credit cards.

Now, in order for your older teens to get a credit card, you have to cosign for them.

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Friday, April 18th, 2008

Money Smart Week Focuses on Financial Literacy

The government has declared April  "Financial Literacy Month," in an effort to address the growing problem of financial illiteracy among Americans.

Financial experts, in fact, have attributed the devastating fallout from the subprime mortgage meltdown to a global lack of financial education.

Several Midwest states are sponsoring "Money Smart Week" from April 20-26. MSW consists of a series of classes offered to the public on everything from managing credit cards to saving and planning for college.

For more information and to find programs near you, visit the Money Smart Week Web site.

Additionally, Total Bankruptcy has launched a new Financial Literacy section, where we will post articles addressing various issues of money management.

If you have questions or would like to see a certain issue addressed, feel free to post on this blog entry.

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