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Making ends meet-nathalie_beneche

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  • 1. Nathalie Beneche
  • 2.  There are, of course, several reasons why the US economy is not blooming as it was fifty years ago. But one of the simplest things we can do to help Americans is to teach money management, especially at an early age. Being aware of how credit cards work, how to balance a checkbook, and how to budget one‟s money are things that all Americans should know. With basic money management skill, young Americans will not find themselves in as much trouble as they do today.
  • 3.  Learning money management should be done at least in the first year of high school because that is when many teenagers are getting their first jobs. In 2007, 34.8% of teenagers were employed. The peak of teenage workers was in 1978 with 72% of teens 16- 19, and although it has decreased greatly since then, it is still a fairly large percentage. A survey done by Jump$tart Coalition in a high school in 1997 found that only 10% of the students learned money management at school And in 2007, another survey was done showing that only 45% of teens know how to use a credit card and 26% know about credit card interest and fees.
  • 4.  Each year about 1.3 million students do not graduate from high school In other words, as CNN reported on August 30, 2010 about seven thousand high school students drop out every day. Those who drop out, on average earn, earn about 260,000 less than a high school graduate.
  • 5.  With the number of students dropping out of school, especially those who already have jobs, credit card companies are always after them. And among those who leave high school and attend college 91% of undergraduates have at least one credit card. The average number of cards is 4.6, which means about half of college students have four or more credit cards. 36% said that they did not know the interest rate on the credit card they used most often.
  • 6.  The minimum  However, it could payment is the lowest take years to pay off amount that one has credit card debt by to pay each month. paying the minimum Because it is so low. It payments. And with is usually around 3- interest that is charge 5% of the total along with that, the balance. People debtor can end up choose to do this paying over twice as because the amount is much as they owed in so small. the first place!
  • 7.  Say your credit card statement balance is $3,000 and your minimum payment due is $20. You submit your minimum payment on time and make no new charges on the card. During the next billing cycle, the amount of interest accrued on the card balance is $95. Your next credit card statement balance would then be $3,075, with a minimum payment due of $20. You submit your minimum payment on time and make no new charges on the card . During the next billing cycle, the amount of interest accrued on the card balance is $100. Your next credit card statement balance would then be $3,155, with a minimum payment due of $20, and the cycle continues.
  • 8.  The National Financial Capability Study did a survey that shows how people are „financially illiterate.‟ Between one and seven, seven being the highest, they were asked how good they are with dealing with day-to-day financial matters. Over half of the respondents said they were a seven, saying they were very good at dealing with day-to-day financial matters. Yet, a quarter of them said before that they “engaged in activities that generate fees or high costs (such as using credit cards for cash advances or overdrawing their checking accounts.” Among those who scored themselves a six, 40% of them engage in the same sorts of activities.
  • 9.  Alliance For Excellent Education, FactSheet, Sept. 2010 http://www.all4ed.org/files/GraduationRates_FactSheet.pdf Financial Capability in the United States Dec. 2009 http://www.finrafoundation.org/web/groups/foundation/@fou ndation/documents/foundation/p120535.pdf The Importance Of Managing Money: Advantages and Disadvantages of Credit http://www.mtstcil.org/skills/budget-12.html Student Credit & Debt Statistics, by Credit.com http://www.credit.com/press/statistics/student-credit-and- debt-statistics.html Understanding how credit card minimum payments are set, by Nazareno A. http://www.creditcards.com/credit-card-news/minimum-credit- card-payments-1267.php

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