Emily Post made it clear in 1922:
“A very well-bred man intensely dislikes the mention of money, and never speaks of it (out of business hours) if he can avoid it.”
Times have changed since the days of Ms. Post, but her point continues to resonate. Money is a touchy subject, one that can turn friends to enemies and produces jealousy or pity in the closest of circles. Consider the following dos and don’ts when it comes to discussing money. The info you find will help you keep it classy.
Why avoid money talk?
Listen up parents and college-bound kids: It’s time for a harsh lesson about the myths of student loans. Student debt accounts for a $1 trillion deficit in this country, the largest it’s ever been. While it’s easy to say, “I won’t let my kids’ education costs spin out of control,” or “My daughter is smart; she’ll pay her loans back with no problem,” the reality isn’t that simple. A recent data poll revealed that 26 percent of borrowers are delinquent in repaying their loans, and an additional 13 percent have defaulted on their loans entirely. For those keeping score, that means 2 out of every 5 borrowers are currently struggling with education debt.
Good news for credit scoring! On March 11, 2013, VantageScore announced the unveiling of its new 3.0 model, a move that will help “27 to 30 million previously unscorable consumers” who are struggling with credit repair. As a collaboration between TransUnion, Equifax, and Experian, VantageScore was developed in 2006. Together, they created a model that promotes scoring accuracy and consistency, allowing lenders and consumers to make decisions based on up-to-date and fair information. So, what’s different about the 3.0 model? According to VantageScore, a “25 percent improvement over VantageScore 2.0,” facilitated by:
Identity theft is a nightmare under the best of circumstances, and it’s even worse when the culprit is a friend or family member. Dealing with credit repair amidst personal betrayal can be overwhelming, but there are a few steps that will help you protect your finances and keep your cool.
What is the difference between a loan and credit? If you are financially astute, you know the answer is “not much.” Sure, there are varying terms, conditions, repayment amounts, timelines, etc., but whether it’s a loan or a line of consumer credit, you are borrowing money you don’t have.
So, why are student loans considered a necessary burden when credit card debt is considered frivolous? A college education is seen as a valuable resource for future success; therefore, paying thousands of dollars to achieve your goal is “necessary.” If done correctly, funding a college degree is a worthwhile endeavor. On the other hand, using reckless tactics to subsidize education is like using your Visa to pay for tuition.
Of course, lenders hope you don’t draw the comparisons between the two. After all, student loans represented a $1 trillion debt crisis by the end of 2012, a number that has economists worried for our nation’s future stability. Within the same vein, we’re worried about your stability when it comes to paying for college. Don’t get swallowed by debt for the sake of a degree. Just as you would with a credit card, avoid these mistakes with student loans.