Consumer Borrowing Rises $14.8 Billion in December

Consumers increased their borrowing in December, with credit cards rising at the fastest pace in eight months. It could be a sign that consumer spending will accelerate as strong jobs gains give shoppers more confidence about taking on debt.

Consumer borrowing expanded by $14.8 billion in December, pushing consumer debt to a record $3.31 trillion, the Federal Reserve reported Friday. In November, borrowing had climbed by $13.5 billion.

The December rise included a $5.8 billion jump in the category that includes credit cards, marking the biggest gain since April. The result followed a $945 million drop in the category in November.

Consumer borrowing in the category that includes auto loans and student loans also rose in December, climbing $9 billion after a $14.4 billion increase in November.

Total debt is up 6.9 percent in the past year. The category covering auto and student loans is up 8.2 percent, while the credit card category has risen just 3.5 percent.

The auto and student loan category has been growing at the fastest rate since the Great Recession of 2007-2009. That partly reflects the fact that many workers who lost jobs during the downturn decided to take out loans to go back to school. Some students also stayed their longer, acquiring more student debt, because had trouble landing jobs.

In contrast, consumers arent using credit cards as much as they used to before the recession. Many economists believe this indicates greater caution about taking on debt to finance consumer spending. But with robust job growth over the past year, consumers are likely to borrow more and fuel consumer spending, which accounts for 70 percent of economic activity.

The Feds monthly report on consumer credit does not cover mortgages, home equity loans or other types of loans secured by real estate.

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Greece To Run Out Of Cash In Under One Week

Speaking to Kathimerini, a top ministry official confirmed the major slowdown in the rate of applications for debt settlement, and referred to post-election consequences from the shortfall in state revenues. The tax collection mechanism appears to be largely out of action while expired debts are swelling due to taxpayers’ wait-and-see tactics and the reduction in inspections.

Less than two months later, the worst case scenario for Greek state cash has materialized, and as Kathimerini reported overnight, Greece now has less than one week of cash left!

To wit: February 24 is expected to be the first crucial day for state finances, as projections of cash flows see state coffers starting to run dry on that date.

Of course, conceding that Greece is out of funds would also mean it is fully out of leverage and give the ECB all the bargaining chips ahead of todays critical ELA decision, so Greek officials quickly tried to spin the reality: Finance Ministry officials, however, assure they have identified resources they could tap if a small extension on Greece’s bailout obligations, up to the first week of March, is granted from the eurozone.

More:

The state of cash reserves – not robust before – has deteriorated further in recent days due to a shortfall in revenues, as a 1-billion-euro hole in January revenues is putting the execution of the state budget in jeopardy and hampering the management of cash reserves.

According to figures released yesterday by the Bank of Greece, in January the net cash result of the central administration posted a deficit of 217 million euros, against a surplus of 603 million in January 2014. Budget revenues reached 3.1 billion euros, against 4.4 billion in January 2014, while expenditure dropped to 3.2 billion from 3.6 billion last year. 

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Women Need to Wake up About Financial Planning

About 70% of baby boomer women will outlive the men in their lives, often living another 15 to 20 years, according to the US Administration on Aging.

That is a scary statistic for women today to face. But we must.

And since our life expectancy today is even longer, we’re going to need to save more money and make sure we have health care.

And yet, according to a recent study by Transamerica, 62% of women said they were saving for retirement, with just 15% saving enough and 22% barely saving at all.

So consider this your 50 shades of retirement. Take the blindfold off and wake up.

Ask yourself the following questions:

Do you understand the finances in your household?

Do you know where your money is being invested?

Do you know how much is saved for retirement?

Because let’s face it – we don’t get much help on the retirement front. Many of us step out of the workforce to care for our babies. (Granted, those are the best years of our lives.) But no one is making Social Security or 401(k) contributions on our behalf during those years.

And then there’s the elderly in our lives. Again, we women take time off to care for them, too. Hey, they don’t call us the sandwich generation because we have made so darn many of them for school lunches over the years.

And don’t you dare tell me your kids will do the same for you when you’re old and need a bedpan.

Seriously?

Look I have the best kids on the planet (I really do) but I am realistic enough to know that I shouldn’t rely on them to change my bedpan.It’s not fair to them (and it’s gross).

So we have to own this. Here are steps:

-Save when you can. It doesn’t matter how much — just put something aside in an investable account so your money can accumulate while you are busy caring for the rest of the world.

-Get a clue about your household finances. And I’m talking every bill – manis and pedis included.

-Think about long-term care insurance, suggests Nancy Coutu, owner of Money Managers Advisory in Oak Brook, Illinois. Especially if you are between ages 45-50, your premiums will be reasonable and it will be comforting to know you’ll have that to lean on when your 95 and still taking Zumba. (Column on this to follow.)

-Get your own credit card. Yes, your own.Nothing joint here.Then use it and pay it off every month. You need to establish credit history in your own name. I never had my own card while I was married and then couldn’t get one when I first got divorced.My mother had to co-sign.Really.

-If you’re not working, think about finding a job.Even a small one gets you access to retirement savings.

There are more demands on women than ever before and no one wants to run out of money or be the proverbial bag lady in retirement, says Coutu. So the time to start thinking about all this is NOW. Let me know how I can help, send your personal finance questions to tracytaxtips@gmail.com.

Tracy Byrnes joined FOX Business Network (FBN) in October 2007 as a reporter.

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Getting your finances fighting fit

FOR those unfamiliar with reality TV, Michelle Bridges is one of the personal trainers putting contestants on The Biggest Loser through their paces.

But where Ms Bridges helps her clients lose weight, Ms Bailey helps shed debt. She delivers her help free of charge through her website, www.debtto10K.com.au, which provides advice, guidance, challenges and deals designed to deliver customers from debt to a bank balance of $10,000. Clients are typically aged in their late 30s or early 40s, with a couple of children and a couple of cars, living comfortably with a decent income. But also a fair amount of debt. Were trying to help the people get out of that debt situation and save some money before they have a need for a government-regulated debt agreement or bankruptcy or having to pay for personal budgeting services which can be quite expensive, Ms Bailey says.
Her business is completely online, with plenty of help but no face to face contact. This ensures privacy and avoids embarrassment, Ms Bailey says. The only income for her company is through commissions from services to which she refers her clients. The only way the company makes money is if we save people money, she says. In future, there may be opportunities for additional products, to charge a fee, but the basic service offering, there will always be a free model, there will always be something free to use – no strings. Ms Bailey has drawn on her own experience with debt to help others. A few years ago she returned from an overseas holiday with plenty of great memories, but also a great big credit card blowout, upwards of $10,000. Shes keen to help others with her experience, gained from several years working in an insolvency office and the canny techniques she used to pay down her travel debt. Weve been compared quite often to being the Michelle Bridges of personal finance, Ms Baily says. Its people like – if you are using the fitness thing – myself, who has got a couple of kilos to lose, but I dont have the time, its too difficult and I would need someone to help me through and push me along. Its not something I would have the motivation to do by myself. I need a program, I need pointers, I need goals, that sort of thing.

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Discover Home Loans Survey: Consumers Say Technology Made Home …

A new consumer survey commissioned by Discover Home Loans revealed recently that potential home buyers make use of technology as a tool to simplify the otherwise labyrinthine, often convoluted process of buying a home.

The 2015 home buying season is due to kick off very soon, with the first month of calendar 2015 having just concluded. And a look at Discover Home Loans’ survey shows that about 90 percent of respondents admitted they used online technology to help them make better home financing decisions. 81 percent of these users said they had an easier time disclosing financial details to their lender, while 69 percent said that tech was vital in helping them maintain their financial documents.

Although a decent percentage of consumers – 36 percent – said that they are perfectly fine with home financing online with no physical or telephone contact with their lender, majority still preferred the traditional means of communication, which is via phone call or in person.

94 percent of consumers surveyed said that they talk on the phone with their lender, 88 percent said they do so via email, while 67 percent did in-person meetings with their lender. 68 percent of those who use electronics in communication said that tech made it easier to deal with their lender, while 54 percent said that they went online to fill out their home loan application.

“As technology continues to become an integral part of our daily lives, it’s only natural that buyers also use it to make the home financing process easier,” read the statement from Discover Home Loans senior manager TJ Freeborn. “Not only are homebuyers using the internet to look at homes and neighborhoods, they’re also using it to submit documents and complete applications online.”

It was obvious to see how tech made it a breeze for many home buyers to carry out the mortgage process. About 80 percent said they furnished their required documents via electronic means, may it be to a lender or to a realtor, or for closing. Among those consumers, 90 percent said that the process was a time-saver. 86 percent of new home buyers, on the other hand, said that they do not have any qualms about sharing their sensitive personal or financial data via the Internet.

Also, 92 percent of home buyers who made use of online tech said it saved time, 83 percent said the main benefit was being organized, and 68 percent said that it was less paperwork to fill out. Over 70 percent of buyers said they submitted lender documents via email, a website, or a mobile application, with 47 percent of those surveyed pre-qualified through a lender’s website.

Talking about the future of online financing, the home buyers surveyed by Discover Home Loans made their share of suggestions on how to improve the online application process. The top suggestion was to ensure secure document submission (77 percent), while other popular suggestions included making online applications easy to use (72 percent), and offering round-the-clock, 24-hour support (52 percent).

Are you interested in homebuying or refinancing? Compare current mortgage rates of top lenders.

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Kansas payday lending operation agrees to $21 million settlement

OVERLAND PARK, Kan. (AP) — Two payday lending companies with ties to racecar driver Scott Tucker have agreed to pay $21 million and waive another $285 million in charges to settle federal claims that they misled consumers.

The Federal Trade Commission announced Friday that the proposed settlement with AMG Services Inc. of Overland Park, Kansas, and MNE Services Inc. of Miami, Oklahoma, includes the agencys largest recovery in a payday lending case. An attorney for the lenders didnt immediately return a phone call from The Associated Press. The lenders had claimed immunity from legal action because of their affiliation with Native American tribes.

A 2012 FTC complaint filed in Nevada said Tucker used $40 million collected from borrowers to sponsor his racing team. Tucker hasnt settled the FTC charges against him.

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5 ways to build wealth on your current salary

Follow our easy-to-implement wealth tips and say goodbye to being broke beyond the 15th of every month

Someone once tweeted that being broke is childish and truth be told, living from hand to mouth actually gets tedious after a while.

How many of us have changed jobs and instead of preserving our pension fund, spent it all on paying off debts and splurging on an overseas holiday? After all, the future seems like a faraway concept that we might never even meet.

Often the assumption is that you’re still young and that there’ll be ample time to catch up with your savings or rectify your bad financial habits. Most wealth experts actually advise that there’s no better time to start saving than when we receive that very first salary in our 20s.

The road to wealth building also requires a change of mindset, meaning old habits like getting your hair done before drawing up your monthly budget should fall by the wayside. The following guidelines will start you off on your journey to building wealth.

  • Save more than you should: The general rule of thumb when it comes to saving is that one should put away at least 10% of their salary. Some of the most successful people save more than that to ensure they will be covered should it ‘rain’ unexpectedly. Some of the wealthiest never feel the need to show off. Instead they save more, find new investment opportunities and have sandwiches for supper instead of splurging on takeaways. Remember to start saving for retirement now and if you can, consult a financial advisor on how to build a few investment/income streams for your retirement.
  • Root out the little things that eat away at your salary: For example a gym membership that you’re paying for but not using, bank charges for the ten times that you’ve withdrawn money in just two days, your phone bill, right down to that unnecessarily big tip you gave the waiter are just some of the bad financial habits that swallow up our salary without us even realising it. Also, go through your bank statements with a fine-tooth comb and you’ll find many things that you’re paying for that you can definitely do without.
  • Draw up a debt plan and stick to it: Draw up a list of those debts that give you sleepless nights, starting with the one with the highest interest rates right down to the lowest. Pay more than the minimum payment required on the debt at the top of your list. As you pay off one debt, repeat the cycle of paying in extra.
  • Keep reminders of what you’re saving for everywhere: Often as our debts clear up and more money is available to us, the temptation to buy a new car or splurge on clothes or your social life arises. Don’t fall victim to this! Put up sticky notes or pictures on your desk or on the fridge at home to remind yourself what you’re saving for. One glance at these reminders will help you be at peace with your priorities.
  • Investments are your best friend: The idea of investing in something that may only materialise in ten to twenty years may seem disheartening at first, but remember that it could set you up for a long time after you’ve retired. Property is a good one and so are equities, especially when you’re still young.

SOURCES: Entrepreneur, Forbes, LearnVest, US News, Investopedia

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    Rockland Trust Outsources Back Office to Embrace Home Loans

    Embrace Home Loans, a direct mortgage lender in Newport, RI, has partnered with Rockland Trust, to process, underwrite and close loans for the Rockland, Mass.-based bank.

    Rockland, a $6.4 billion-asset bank, said in a press release that it has interest in expanding its home loan finance business as demand increases due to low interest rates and general recovery in the price of housing. The bank will also begin to offer US Department of Agriculture and Department of Veterans Affairs loans in Massachusetts and Rhode Island.

    By partnering with Embrace Home Loans, were able to expand our mortgage offering and provide a better experience to borrowers — critical as the demand for home financing continues to grow and we shift to a purchase-driven market, Rocklands senior vice president and director of residential lending Armando Carvalho said in a release.

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    Cultivating Youth As Agents of Change Through Urban Agriculture

    Come January and February, winters doldrums are lessenedat least for Twin Cities urban gardeners and farmersby the arrival of seed catalogs. Poring through pages with images of and information on a cornucopia of vegetables, flowering plants and even gardening tools can quicken excitement for spring. The youth at Urban Roots on St. Pauls East Side are no exception. This week the kids started planning the gardens, says Rebecca Mino, manager of Urban Roots Cooking amp; Wellness Program, and are excited about another year of planting, harvesting and selling what they grow.

    Urban Roots has been gardening with East Side high-school students since 1996, hiring them as interns for an array of positions. The youngest are 14, and they can work until the summer after high-school graduation. In the Market Garden Program, they work in seven vegetable gardens, run a Community Supported Agriculture (CSA) program, and operate a farmers market stand.

    They sell produce to local restaurants and salads at the Roots for the Home Team stand at Target Field during ball games. They also teach cooking and nutrition classes to other youth and families through Urban Roots Cooking amp; Wellness Program. The goal of these programs is to cultivate good health on the East Side by growing fresh food, leadership skills and economic independence through urban farming and other networking and educational opportunitiesseeding such community development initiatives by focusing on youth.

    Before I came to Urban Roots, I ate junk food. I hadnt even heard of kale or chard, and I hadnt ever tasted a radish, says one former intern, who remains an avid gardener. Shes also majoring in English literature and communications in college, as the Urban Roots experience cultivated her confidence with writing, public speaking and interacting with reporters.

    My family cooks traditional Hmong dishes, but now I pass along to them what I learned, she adds. Its fun to cook for them and introduce new vegetables and whole grains. I tell my friends that this isnt about eating just salads. There are so many different kinds of healthy foods and delicious ways to prepare them.

    The greater community benefits from Urban Roots youth programs, as well. Besides the nearly 4,000 pounds of fresh produce interns deliver each growing season (including food shelf contributions), nearly 1,500 East Side residents learn about cooking, nutrition, gardening and environmental conservation. For a neighborhood described as a food desertmeaning fresh produce is difficult to find, much less purchase at reasonable costthats no small feat.

    Gardening: wealth building and leadership opportunities

    In 2010, the Blue Cross Blue Shield Foundation of Minnesota and Amherst A. Wilder Foundation released a study titled The Unequal Distribution of Health in the Twin Cities. The study asked: Is there a connection between socioeconomic status and health in the Twin Cities? The answer is Yes. The study found that here as elsewhere health is strongly connected to race, income, and the specific parts of the metro area in which people live.

    According to the study, areas within the Twin Cities where people experience the most ill health and shortest life expectancies are also the poorest economically. Those neighborhoods include North Minneapolis, and Phillips and Powderhorn in Minneapolis. In St. Paul, the study pointed to the Frogtown and West Seventh neighborhoods, as well as Payne-Phalen and Daytons Bluff on the East Side.

    Urban Roots is just one of many community development organizations that is working to improve residents quality of life by integrating urban gardening with wealth building. Frogtown Farm is another initiative. A vision of longtime Frogtown residents, the urban farm and park is currently in its development phase, but intends to become a hub for a healthy food system that fills gaps in food production, storage, manufacturing, and distribution, according to the website.

    Then theres the East Side Healthy Foods Initiative, which will help Market on the Bluff in the Daytons Bluff neighborhoodwhich last year transitioned into becoming vendor-owned and operatedhit the road this summer as a traveling market.

    Urban farmer Timothy Page, who co-owns Holistic Health Farms, and Page and Flowers in St. Paul, is the former manager of Market on the Bluff. Through his companies, Page and his partner Cherry Flowers provide local food systems expertise, edible landscape planning, garden program coordination and implementation, and education to other community organizations. They also grow and market produce.

    Last year, Page decided to share his insights on budgeting, sales and marketing, and customer relations with other Market on the Bluff vendors, in order to facilitate the vendors collaborative efforts to run the market themselves. As a result, Page says, Market on the Bluff has become not only a wealth building and leadership opportunity for the vendors. The market has also become a community-gathering place.

    Parents set up play dates for their kids at the market, Page says. People share recipes. The vendors have stopped competing with each other. Instead, theyre sharing insights on how to be more successful at marketing and selling their produce and products.

    Page and Flowers have also shared their expertise with the youth at Boys Totem Town, a residential program for adolescent boys who have been adjudicated delinquent by the Ramsey Countys Juvenile Court.In addition to helping the boys plant a vegetable garden and market the produce, Page says, We talk with them about the importance of eating healthy food, the value of urban farming, and transferable skills: why its better to sell veggies than drugs.

    Through gardening, we teach them to lead themselves and make their own and better decisions, Page adds.

    Cultivating the next generation of food producers

    In North Minneapolis, says DeVon Nolen, manager of the West Broadway Farmers Market, the Blue Cross Blue Shield/Wilder findings inspired numerous community initiatives. What came out of the study was that we do not have enough access to fresh local food, she says, but if we did have access, we would consume it!

    The community launched Wholesome Ways in coordination with Blue Cross Blue Shield and NorthPoint Health amp; Wellness Centera fruit and vegetable prescription program for households in which a member is diabetic. Each week, the household received a prescription they could redeem for up to $35 in produce at West Broadway Farmers Market. This program drove more even consumers and revenue to our market vendors, Nolen says.

    Last year, 60 percent of the markets vendors were Northside growers. Because the market is a project of the West Broadway Business Coalition, vendors and other local food entrepreneurs receive technical assistance, and information on licensing and insurance, promotion and marketingin order to develop their self sufficiency.

    Reaching out to youth was also imperative. Project Sweetie Pie, a program that encourages young people to become food producers, and the family program Appetite for Change, inspired two 16-year-old residents to participate in the Minneapolis Healthy Corner StoreProgramto bring fresh fruits and vegetables to small businesses in their neighborhoods via BrightSide Distribution.

    People rely heavily on corner stores for food, Nolen explains, but its not always cost effective for those stores to carry fresh produce. Demand isnt heavy enough and thus the prices are high. So these kids worked with BrightSide to bring in bulk produce, and distributed portions to each grocery store so it was economically viable without a lot of waste.

    Those kids are now part of her secession plan, Nolen says, the next generation of organizers and leaders around food justice; understanding the correlation between income and mortality, increased healthy food access and health outcomes; and how food initiatives foster economic independence.

    Becoming agents of change

    At Hope Community in the Phillips neighborhood of South Minneapolis, a series of community listening sessions focused on challenges people experience when trying to get healthy food, and how they experience food in relationship to health, community and family. Those sessions resulted in a partnership with the Land Stewardship Project to create a variety of programs including a community garden, a youth program for growing and preparing healthy food and developing leadership, and cooking opportunities for residents to share knowledge and recipes.

    The sessions also produced a leadership team, which is plotting next steps in the neighborhoods development from food desert to resource for fresh, sustainable produce. At Hope we work from the core belief that peoples connections with each other are an important underpinning of a healthy stable resilient existence, says Betsy Sohn, an organizer and program manager. Were growing our capacity to do this work by partnering with other local organizations to create supportive environments in which people can feel good about eating fresh healthy food.

    One of Hopes initiatives is the Youth Stewards Program. Participants work in the community garden, harvest and sell their produce, lead cooking demonstrations, and learn about food within the context of the greater urban environment. During a harvest gathering last fall, Sohn says, youth from the program had so much to say, about how they loved digging in the dirt, even though at first they thought it would be icky and wormy; how they loved meeting people different from them and discovering what they had in common.

    Its important that we create opportunities for young people, at an early age, to be outside and thinking about what they can do to stay healthy, she continues. At one of our listening sessions, one of the youth said: lsquo;When youre a teenager and go to a store with junk food, you just cant stop eating ithellip;its like its a part of you. So as a community we need to help each other stay healthy, and let youth and families know they dont have to accept whats happening in the world. They can be agents of change.

    This story is part of a series on community transformation underwritten by Local Initiatives Support Corporation (LISC) Twin Cities, an organization dedicated to helping community residents transform distressed neighborhoods into healthy and sustainable communities of choice and opportunity.

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    Historic Macon announces another round of home loans

    MACON, Georgia (41NBC/WMGT) – Homeowners in the Vineville Historic District, Downtown Macon, and College Hill Corridor can apply for special home loans.

    Historic Macon announced a new round of facade loans for $5,000 and $10,000. They also feature a three-percent interest rate for the life of the loan, not to exceed five years. Ethiel Garlington, Executive Director of Historic Macon, says the goal of the loans is to enhance the exterior appearance of the home with painting, roofing, landscaping, and minor repairs.

    Georgia Power also mentioned its Energy Rebate Program, that is associated with the facade loans. Rebates up to $2,575 have a potential annual electric savings of up to 30-percent.

    The goal is to make the loans affordable and to save you money in the longrun, Garlington explained.

    Applications for the loans are accepted year round and deadlines fall on the last day of each month. A loan committee overseas the application and approval process. To learn more information visit, click here.

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