PHOENIX - For young adults just starting out, now is the time to brush up on essential personal finance skills to help lead to success down the road. With that in mind, the Arizona Collectors Association released a few tips to help young adults stay out of financial trouble.
First on the list, set and maintain a budget. By setting goals you can create a budget and keep tabs of what you spend. Good habits now will carry on with you.
Second, start saving today. A sound savings plan can help ease financial stress. If your employer offers a 401K or retirement plan, the sooner you start saving, the better.
Understand credit. When used properly, credit can be quite helpful. On the other hand, credit can be a very difficult burden. From student loans to credit cards to auto loans, be sure you know the terms and conditions. Shop for low interest rates and make sure you understand the ramifications of late or missing payments.
Other tips suggested by ACA:
-Take responsibility. Getting a loan, obtaining credit or using a credit card can be very helpful but it comes with an immense amount of personal responsibility to live up to your obligations in paying back a debt. On the other end of the credit is a creditor expecting repayment. Maintaining healthy debt levels and repayment practices provides significant positive or negative impact on your ability to get credit in the future.
-Communicate. If you are in debt or need to miss a payment, don’t ignore the issue. Be proactive and contact the creditor or debt collector to discuss the situation and seek a mutually beneficial arrangement. If you are contacted by a creditor or debt collector, do not ignore them. Remember, they aren’t the enemy, and communication to discuss the account, verify its accuracy and work on a plan for resolution can be very helpful.
-Protect your personal and financial information. Be careful about giving out information including a credit card, bank account, or Social Security number over the phone and online until certain of the authenticity of the other party. Monitor accounts and immediately report any suspicious or unauthorized purchases to your bank or credit card provider. Importantly, consumers should also monitor their credit report. If you believe your identity has been stolen, contact your local police department and visit www.ftc.gov/idtheft for information on what you should do.
-Active military have special privileges. The Servicemembers Civil Relief Act (SCRA) allows active military and, in a few cases, non-service members, to suspend or postpone certain civil obligations. A lender, creditor or insurer is prohibited by law from taking any adverse actions against military personnel because they exercised their rights under SCRA, which can only be exercised while engaged in active duty; including full-time training; annual training duty; and attendance at a service school while in active military service.
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