As we approach the beginning of yet another year, consumers and families are given an opportunity to start anew with a fresh financial plan. At ACCC we work with clients year-round to help break bad spending habits and to overcome significant financial challenges and we know how overwhelming this uphill climb can be. But, over the past year, we have seen positive signs in our economy, decreasing unemployment numbers, and fewer foreclosures and bankruptcies being filed. These signs of economic recovery are encouraging for most consumers, but there is still much work to be done both on the individual level and by our state and federal governments to help tackle some of the greatest issues facing our country: student debt, protecting consumer rights, and being smart about credit. So here’s my holiday wish list for American families. It doesn’t require adding more household debt. Rather, it takes commitment and resolve from both government and individuals to make our financial lives a little easier.
- Rein in the cost of higher education and make the process of financing college easier: American students are starting to question the value of beginning their careers loaded down with debt. A recent survey by American Consumer Credit Counseling found that nearly half of all respondents felt their college education wasn’t worth the cost. College debt is the next housing bubble – and it’s ready to burst all over American families. For the first time ever, college debt now exceeds total consumer credit card debt. Traditional options that have been more affordable – like public higher education – are increasing in cost every year. Many students don’t even realize how much debt they have incurred until they receive their first statement after graduation. One step in the right direction we have seen is that the U.S. Department of Education’s Financial Aid Shopping Sheet has been adopted by more than 500 colleges and universities. This valuable resource provides a standardized award letter allowing students to easily compare financial aid packages as they decide on which school to attend. It takes the mystery out of the bottom line for college costs, which leads to more informed decision making.
- Make the most of new tools aimed at protecting consumers from overzealous or abusive debt collectors and credit rating errors: The Consumer Financial Protection Bureau is flexing its muscles to the benefit of American households. Large collection agencies, debt buyers and collection law firms are now subject to enhanced scrutiny and examination by the CFPB. As well as credit rating agencies, which have tremendous impact on the financial profiles of all American consumers and their ability to get the best terms on financing. While the CFPB is doing its part, consumers must also do theirs. That means being attentive and vigilant in monitoring credit reports, maintaining a budget and paying obligations on time, and reporting abusive debt collection practices to the CFPB, Federal Trade Commission or appropriate state authorities.
- Use the power of smart consumerism to do more than just spend. Shop for savings too: American consumers should put the same amount of time and effort into finding the best deals on savings rates, credit cards, mortgages, and investments as they do into buying new appliances, furniture, and cars. The long-term payoff can mean thousands of dollars per year just by making their hard-earned savings work harder for them. Bankrate.com offers some of the best comparisons for savings accounts, CDs, and mortgage rates. TreasuryDirect.com is a one-stop marketplace for everything consumers need to know about purchasing government securities such as savings bonds, Treasury bills, notes, and bonds. Smart budgeting tools can help keep your household finances on track. A host of such resources can be accessed at the Association of Independent Consumer Credit Counseling Agencies web site (AICCCA.org), at American Consumer Credit Counseling’s ConsumerCredit.com or through any number of AICCCA’s more than 25 member agencies.
From me and everyone here at American Consumer Credit Counseling, we wish you and your families a happy, safe and financially healthy holiday and New Year.