Based on recent research, findings comparing the financial habits of women and men include:
Overall, single men outspend women, which may be due to higher average earnings. Men spend more on food and transportation, while women have higher spending for clothing. Both groups have similar spending for entertainment.
Women are wiser shoppers, buying items on sale and using coupons more often than men.
For debt, including credit cards, student loans, auto loans, personal loans, home equity lines of credit, and mortgages, men have more debt than women.
For both groups, the main financial goals were saving for a vacation, paying off credit card debt, and improving their credit score.
As they near retirement, men had higher amounts in their retirement funds. However, women are more likely to participate in an employer retirement plan than men, and save a greater percentage from their paychecks.
For additional information on the money habits of women and men, go to:
Retail store cards are credit cards that can be used only in a single store or at an affiliated group of stores. Like other credit cards, a store card will show as a line of credit on your credit report.
The disadvantage is that retail store cards may carry higher interest rates than traditional credit cards. Also, if the card has a deferred-interest promotion, you could end up paying even more in interest if your balance isn’t fully paid off by the end of the promotional period.
Six rules for using your store credit card wisely
Watch your overall spending during the holidays
Pay your bill on time
Understand the differences between zero-interest and deferred-interest promotions
A lifetime of skillful financial decisions starts with experiential learning at a young age. To increase financial literacy for the next generation, consider these actions:
Give children a payday. Instead of a weekly allowance with simply giving money, create a system of earning these funds. Connect their household chores to earned amounts with a weekly payday. This practice can teach a child that people are paid for work to earn money for their living expenses.
Create awareness of opportunity cost. Every financial decision has trade-offs. Once money is spent, that money is not available for other uses. Keeping money in a clear jar allows the young person to visually see what funds are available, and when the money is gone.
Allow children to experience borrowing. If a child wants to buy something but does not have the money, set up a signed loan agreement with repayment terms. Also create a plan for the amount owed to be taken from future household earnings. Have the young person physically pay the money to better understand how credit works.
Connect them in the budgeting process. Include children in the discussion of family finances and the household budget to help them understand where money is spent. Consider creating a chart with spending amounts, or use slips of paper representing money that are used to pay the bills each month.
Teach wants vs. needs. Shoes or a clothing item may be a need but not a high-fashion version. To cover the cost of the higher-priced item, young people should be required to earn the amount for the additional expense.
Use money games. These activities can help children understand earning, saving, wise spending and other basics of money management for a financially sound future.
For additional information on financial literacy for children, click here.
Have students conduct online research to locate other actions used by parents to teach their children smart spending and wise money management.
Have students talk to parents to obtain suggestions that might be used to teach wise money management to children.
What are the financial, social, and relational benefits of children learning smart spending and wise money management early in life?
Describe possible money management learning activities for children that involve creative use of technology.
35% of credit card holders paid only the minimum on their credit cards?
In September 2019, the FINRA Foundation released data from its latest Financial Capability Study—one of the largest and most comprehensive financial capability studies in the United States. Among the findings, younger Americans, those with lower incomes, African-Americans and those without a college degree face the toughest financial struggles. More than 27,000 respondents participated in the nationwide study. Conducted every three years beginning in 2009, it measures key indicators of financial capability and evaluates how these indicators vary with underlying demographic, behavioral, attitudinal and financial literacy characteristics—both nationwide and state-by-state.
What should you do if you believe your debit or credit card has been compromised? Yes, there are consumer protection regulations that can help. For example, the Electronic Funds Transfer Act (EFTA) and the Consumer Financial Protection Bureau’s (CFPB’s) “Regulation E” limit your liability for losses from unauthorized transactions.
If your debit or credit card number is used to make an unauthorized withdrawal from a checking or savings account, minimize your losses by contacting your bank as soon as possible. Your maximum liability under EFTA is $50 if you notify your bank within two business days after learning of the loss. If you wait longer, you could lose more, according to the law.
If your credit card number is used without your authorization, your liability is normally capped by the Truth in Lending Act (TILA) and the CFPB’s “Regulation Z” at $50 for all unauthorized transactions, and remaining credit card losses are typically absorbed by the card issuer. Some other worthwhile precautions you can take include:
Do not use ATMs in remote places, especially if the area is not well lit.
Go elsewhere if you see a sign directing you to only one of multiple ATMs in a location.
Shield the keypad with your hand when typing your PIN at the ATM or a retailer’s checkout area.
Regularly check your bank and credit card accounts for unauthorized transactions, even small transactions that you might think might not be worth reporting to your bank.
“Currency still has its place, despite the pervasive use of plastic.”
Today, it seems that more people are using credit or debit cards to pay for everything. And yet, this article provides reasons why cash may be a better payment option. Those include
A cashless society? Not so fast. According to a recent Federal Reserve Bank of San Francisco study, 40 percent of consumer transactions involve cash–a higher percentage than for debit cards (25%), credit cards (17%), electronic payments (7%), and checks (7%).
Currency comes in handy. Most vending machines don’t take plastic, and cash works best for all small purchases.
Hamiltons can’t get hacked. With data breaches of major retailers becoming common, some consumers pay by cash to protect their credit card information.
A cash fix can cost you. If you get a cash advance from an ATM outside your bank’s network, you’ll pay more than $4, on average.
Cash is a great budgeting tool. If you have trouble controlling your spending when you pay with credit cards, then cash or a debit card is best for your finances.
Paying by cash may be a good option, but it won’t help build your credit history. Using a credit card now and then for routine purchases can help build a good credit history.
Counting every penny on your credit and debit card statements can help detect fraud
Most people looking at their bank statements would probably notice if their credit or debit card were used without their approval to purchase a big ticket item, and they would quickly call their bank or card issuer to report the error or fraudulent transaction. But consumers are less likely to be suspicious of very small charges, including those less than a dollar…which is why criminals like to make them.
“These transactions might be signs that someone has learned your account information and is using it to commit a crime,” said Michael Benardo, manager of the (Federal Deposit Insurance Corporation) FDIC’s Cyber Fraud and Financial Crimes Section. “That’s why it’s important to be on the lookout for fraudulent transactions, no matter how small.”
He added, “When thieves fraudulently obtain someone else’s credit or debit card information and create counterfeit card, they might test it out with a small transaction—like buying a pack of gum or a soda—to make sure the counterfeit card works before using it to make a big purchase. If this test goes unnoticed, by the true account holder, thieves will use the card to buy something expensive that they want or that they can easily sell for cash.”
For most consumers, the biggest benefit of mobile payments is convenience. No need to pull out your wallet for cash or plastic—especially if you’ve got your phone at hand anyway. No need to type your payment information to buy online. But what if your financial and other personal information isn’t safe?
Security is important since you usually carry your mobile device with you, it’s on most of the time, and it may contain sensitive information. Consumer Federation of America (CFA) offers advice on how to avoid security pitfalls, what features keep your mobile device and your payments safe, and how to prevent others from making mobile payments without your permission.
While beneficiary, collateral, and fair market value are familiar to many, these terms can be especially confusing to those with limited English-language skills. In an attempt to assist various people, the Consumer Financial Protection Bureau has created the Newcomer’s Guides to Managing Money to provide recent immigrants with information about basic money decisions. These guides offer brief suggestions to those who are new to the U.S. banking system. The guides also include guidance for submitting and resolving problems with a financial product or service.
The Newcomer Guides include these topics:
Ways to receive your money, comparing cash, check, direct deposit, and debit cards.
Checklist for opening an account, to assist with starting a bank or credit union account.
Ways to pay your bills, providing guidance on whether to pay by check, debit card, credit card, or online.
Selecting financial products and services, providing assistance on deciding which financial services are right for various household situations.
Print copies of the guides can be ordered or downloaded. These publications are available to English and Spanish with additional languages to be offered in the future.
For additional information on money guides for newcomers:
Banks and card issuers have been sending out new credit and debit chip cards, usually as existing cards expire or need replacement. If you haven’t gotten your new cards, don’t worry. The rollout will continue at least through 2016. If you want to know when yours new chip cards will arrive, contact your card issuers at the phone numbers on your cards.
Your new cards look like your old cards with one exception. New cards have a small square metallic chip on the front. The chip holds your payment data—some of which is currently held on the magnetic stripe on your old cards—and provides a unique code for each purchase. The metallic chip is designed to reduce fraud, including counterfeiting.
Here’s how it works: To buy something in a store, instead of swiping your card, you’ll put it into a reader for few seconds. Then you might have to sign or enter a PIN. With each transaction, the chip generates a unique code needed for approval. The code is good only for that transaction. Because the security is always changing, it’s more difficult for someone to steal and use.
There will be no change in how you use your card online or by phone. That means chip cards won’t prevent crooks from using stolen card numbers to buy online or by phone. So it’s a good idea to still guard your card information closely, and check statements for suspicious activity. If there is a problem, your consumer protections remain the same.