Digging out of debt, learning value of saving
High credit card debt lowers credit scores, increasing the chances that consumers will pay higher interest rates on personal loans.
Alabama Cooperative Extension workshops are helping urban consumers improve their overall economic well-being by avoiding financial risks, indebtedness and bankruptcy. As a result, many participants applied for a copy of their credit report for the first time to review and correct their report and improve their overall credit score.
After the workshops, surveys indicated participants had cut monthly expenditures and saved an average of $70 a month, or $840 a year. More people said they now track their spending habits and make fewer impulsive financial decisions. They are reducing their use of alternative sources of credit such as payday loans, cash advances or title loans. Many more have developed spending plans and included their children in family conversations about money.
Overall, financial management education is helping families learn the value of saving money that will help offset economic crises and enable them to meet short- and long-term financial goals.