FIVE THINGS TO DO BEFORE LEAVING HOME ON BLACK FRIDAY

Washington, DC – For many, shopping on Black Friday has become as much of a Thanksgiving tradition as turkey, with friends and families whipping up a shopping strategy along with the dressing and gravy.

The National Foundation for Credit Counseling advises consumers to shop smart by planning ahead. Following are five steps consumers should take before hitting the stores on Black Friday, helping them enjoy their shopping excursion without harming their pocketbook.

· Beware of special credit card offers – Issuers are tempting consumers by offering incentives such as no interest balance transfers, extra perks by meeting certain spending levels, and increased cash back in specified categories. However, no deal is a good deal if you can’t afford it. Responsible shoppers will commit to spending no more than what they can repay in full when the bill arrives, regardless of how many bonuses are tacked on.

· Know what you currently owe – Review all existing debt obligations, tallying what you’ve already spent and committed to repay. This reality check may put a temporary damper on your holiday mood, but that’s better than digging the financial hole even deeper.

· Create a plan – Knowing who you’re shopping for, what items you hope to find, and most importantly, how much you intend to spend is critical to a successful shopping day. Commit in advance to stick to your plan, and enlist an accountability partner if necessary, as it is very easy to be caught up in the excitement of the moment and get off course.

· Find the best deals at home – Shop from home before heading for the stores. Compare prices online, as well as local circulars for sales in your area. Be aware of time restrictions, as some prices may only apply during certain time periods throughout the day. Once the actual shopping begins, going directly to the store which has your item at a good price will save you time, gas, money and frustration.

· Remove all unnecessary cards from your wallet – Spreading purchases across multiple cards makes you feel as though you’re charging less and can trick you into overspending. Designate one card for holiday spending, and remove all others from your wallet. This will not only help you stay within your budget, but will also lessen the damage in case of loss or theft.

“It is important for consumers to shop with their head, not their heart,” said Gail Cunningham, spokesperson for the NFCC. “Preparing in advance will help you stick to your budget, in spite of the decorations, carols and Santa himself beckoning you to spend.”

The Great American Smokeout on November 17th

ARE YOU ADDICTED TO YOUR BAD FINANCIAL HABITS?

Washington, DC - The Great American Smokeout on November 17^th is a day dedicated to helping consumers overcome their addiction to the smoking habit. The nationwide event encourages people to put down their cigarettes in favor of a healthier lifestyle.

The National Foundation for Credit Counseling (NFCC) also supports a healthy lifestyle, one which includes financial health. “In addition to the known health risks associated with smoking, it is also damaging to your pocketbook,” said Gail Cunningham, spokesperson for the NFCC. “A pack-a-day- habit can easily cost $150 per month, often taking money from priority expenses such as housing, groceries or gasoline.”

Smoking certainly isn’t the only habit that can be costly to your financial well-being, nor is it the only one that can become addictive. In this economic environment where consumers often struggle to make ends meet, they may resort to desperate measures when in need of money. Since quick fixes are often habit-forming, the NFCC recommends evaluating the following behaviors, giving consideration to kicking your own financial addictions.

Payday Loans - On the surface, getting the cash you need may seem worth it at any cost. But it’s that cost and the addictive nature of seemingly easy money that can become financially back-breaking. To obtain a payday loan, you write a post-dated check for the amount of the loan plus any fees the lender tacks on. You then receive the amount of money you initially needed to borrow, promising to pay back that amount plus the fees. The term of the typical payday loan is one to two weeks, at which point the lender cashes your post-dated check. Most payday lenders will charge a certain dollar amount per $100 borrowed. For example, they may charge $15 for every $100 they loan you. Thus, if you needed $300 until your next paycheck arrived, your post-dated check would be for $345. What’s $45 when you desperately need $300? Here’s the catch…that $45 represents an Annual Percentage Rate of 390 percent. You wouldn’t dream of taking out any other type of loan with triple-digit interest. And, if this isn’t bad enough, many consumers cannot repay the loan at term, and end up rolling it over, thus adding on more fees and interest.

Pawn Shops – People can do several things at pawn shops. They can borrow money by putting up something of value as collateral in exchange for cash, they can sell their merchandise outright, or they can buy the merchandise that is for sale at the shop. There are bargains at pawn shops, but only for those buying the merchandise, not for the sellers. Typically, the person pawning the merchandise receives a sum of money (usually nowhere near the true value of the item) which he or she agrees to repay with interest. If the loan is repaid by the end of the term, the merchandise is returned to the owner. If the loan is not repaid, the consumer can renew the loan, or the merchandise is forfeited. What’s the problem? Again, it’s the interest and fees, with APRs typically in the triple-digit range once all charges are included. Further, some studies have shown that only 60 percent of pawners end up reclaiming their merchandise, thus they have essentially sold an item for cents on the dollar, something they wouldn’t otherwise do.

Rent-to-Own – Everyone wants nice things, and if the family is coming over for the holidays, you may be tempted to spruce up your home. A quick trip to the furniture or electronics store could confirm that a new living room set and flat panel TV are out of your price range. Then you notice an ad for similar items with affordable monthly payments. It seems too good to be true, and guess what, it is. The problem once again lies in the interest and fees. For instance, if you bought a $200 item and agreed to make the seemingly affordable weekly payments of $15 for 78 weeks (basically one and one-half years), you’d end up paying $1,170 for that $200 item at an APR of 388 percent. Adding insult to injury, it is likely that you could have purchased the same item at a traditional store for a fraction of the overall cost.

“People wonder why anyone would agree to the terms imposed by payday loan companies, pawn shops and rent-to-own businesses. The answer is that consumers who utilize such concerns typically do not qualify for loans from banks or credit unions, and would not be approved for in-store lines of credit. Nonetheless, people need to understand that even though there is always a cost to credit, when that cost becomes unreasonable, the consumer is better off considering other options or doing without. The real answer lies in breaking your addiction to these easy money solutions by probing to understand the root of the problem and resolving it,” Cunningham continued.

If you need assistance breaking your financial bad habits, reach out to an NFCC Member Agency where you’ll find legitimate help through a trained and certified credit counselor. To be automatically connected to the agency closest to you, dial (800) 388-2227, or to locate an agency online, go to www.DebtAdvice.org. For assistance in Spanish, dial (800) 682-9832.

The National Foundation for Credit Counseling (NFCC), founded in 1951, is the nation’s largest and longest serving national nonprofit credit counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services. NFCC Members annually help more than three million consumers through close to 800 community-based offices nationwide. For free and affordable confidential advice through a reputable NFCC Member, call (800) 388-2227, (en Español (800) 682-9832) or visit www.nfcc.org. Visit us on Facebook: www.facebook.com/NFCCDebtAdvice, on Twitter: twitter.com/NFCCDebtAdvice, on YouTube: www.YouTube.com/NFCC09 and our blog: http://financialeducation.nfcc.org/.

South Carolinians Are Getting Out of Debt with Help From Family Services, Inc.

Individuals and families should be advised that there is help available to clean up personal financial wreckage fueled by the recession. Michaele Pena, Director of Family Services, Inc’s Consumer Credit Counseling Services encourages consumers to be proactive and seek free credit counseling. Family Services, Inc.’s Debt Management Program is designed to help reduce high interest rates and set up a payment plan to pay back unsecured debt. There is no minimum debt that is required to participate in the program, “You do not have to be in a delinquent status to explore the debt management program or enroll,” advises Pena, “Get help early rather than later. One of our licensed financial counselors will work with you and outline options that may help you improve your financial situation.”

Family Services, Inc.’s Debt Management Program works to help credit burdened consumers pay off their unsecured debt within five years and receive free financial literacy education. Consumers are invited to attend free counseling over the phone or in person to learn where their money is spent unnecessarily, develop a personal budget that they can live with, how to take the initial steps towards improving their credit by paying their monthly bills in a timely/consistent manner, and determine if they qualify for the Debt Management Program. In 2011’s third quarter, 9 previously credit burdened individuals successfully completed Family Services, Inc.’s Debt Management Program and collectively paid back $223,176 while they were enrolled in the program. Year to date, 45 credit burdened individuals successfully completed the program and collectively paying back $1,241,499; an average of $27,588.

“Clients who successfully complete the program are always very thankful for our help. The debt management program provides an alternative to filing bankruptcy.” Pena states, “I am quick to remind our clients that they did the hard work, with guidance and encouragement from their counselor and the Debt Management Program staff. Graduates of the Debt Management Program prove that financial hardships can be turned around to the positive. It takes dedication to live within your means financially and following the program to be debt free from all unsecured debts.” For information on how you may benefit from Family Services, Inc.’s Debt Management Program contact Michaela Pena at 843735.7840 or visit www.fsisc.org

OVERWHELMING MAJORITY OF CONSUMERS WOULD CHANGE FINANCIAL INSTITUTIONS TO AVOID PAYING DEBIT CARD FEE

OVERWHELMING MAJORITY OF CONSUMERS WOULD CHANGE FINANCIAL INSTITUTIONS TO AVOID PAYING DEBIT CARD FEE

NFCC Advises Consumers to Talk Before They Walk

Washington, DC – The October online poll conducted by the National Foundation for Credit Counseling (NFCC) revealed that only three percent of more than 2,400 respondents would continue using their current debit card as usual if a fee were imposed.

“People have become very aware of how they spend their money, even small amounts, and that’s a good thing,” said Gail Cunningham, spokesperson for the NFCC. “The poll results send a strong message, but at this point that message remains a sentiment. Only time will tell if people will follow through and actually change long-ingrained habits.”

As financial institutions evaluate their options, consumers should do the same and be prepared for any changes that might impact their accounts. The NFCC offers the following pros and cons of financial decisions based on the poll results:

· Find a bank that doesn’t charge debit card fees = 62 percent

o Pro – Keeps the availability of a debit card while avoiding fees.

o Con – Changing financial institutions is difficult, particularly if you have direct deposits or drafts associated with your checking account. If you elect to change, don’t close the old account until three months after you open the new one, thus allowing time for all transfers to be in place. Check out the convenience of that bank’s ATM machines and usage fees, along with the cost of new checks.

· Begin paying with cash = 22 percent

o Pro – Controls spending, as you can’t spend beyond what you have.

o Con – Carrying large amounts of cash can be dangerous and inconvenient.

· Begin paying for purchases by check = 8 percent

o Pro – Maximizes the use of the existing checking account which may already have a fee associated with it.

o Con – Using checks can be inconvenient, with some places not accepting that form of payment. Additionally, there is the chance of over-drafting the account and incurring penalties.

· Begin charging purchases = 5 percent

o Pro – Charging creates a credit file and resulting credit score. If handled responsibly, this can work in a person’s favor for future financial needs.

o Con – Credit makes overspending easy. If not handled properly, charging goods and services can result in financial disaster.

· Keep using my debit card as usual = 3 percent

o Pro – Avoids the potential hassle of changing banks.

o Con – Adds a new fee per the terms of the financial institution.

“As with any financial decision, consumers need to do their homework and evaluate all options to determine which is best for their lifestyle,” continued Cunningham. “The bottom line is that banks have the right to assess fees, and consumers have the right to choose who they do business with. Before leaving, however, consumers should ask the bank to waive the fee, citing how long they’ve been a customer, how many bank products they are using, and associated balances. No one wants to lose a valuable customer, so be sure to talk before you walk.”

For professional assistance regarding your financial questions, consider an appointment with a certified consumer credit counselor at an NFCC Member Agency. To be automatically connected to the Agency closest to you, dial (800) 388-2227, or to locate a counselor online go to www.DebtAdvice.org. For assistance in Spanish, dial (800) 682-9832.

The October poll question and results are as follows:

If my bank were to impose a fee related to debit card use, I would…

A .Keep using my debit card as usual = 3%

B. Find a bank that doesn’t charge debit card fees = 62%

C. Begin paying for purchases with cash = 22%

D. Begin paying for purchases by check = 8%

E. Begin charging my purchases = 5%

Note: The NFCC’s October Financial Literacy Opinion Index was conducted via the homepage of the NFCC Web site (www.DebtAdvice.org) from October 1 - 31, 2011 and was answered by 2,404 individuals.

The National Foundation for Credit Counseling (NFCC), founded in 1951, is the nation’s largest and longest serving national nonprofit credit counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services. NFCC Members annually help more than three million consumers through close to 800 community-based offices nationwide. For free and affordable confidential advice through a reputable NFCC Member, call (800) 388-2227, (en Español (800) 682-9832) or visit www.nfcc.org. Visit us on Facebook: www.facebook.com/NFCCDebtAdvice, on Twitter: twitter.com/NFCCDebtAdvice, on YouTube: www.YouTube.com/NFCC09 and our blog: http://financialeducation.nfcc.org/.