| It is not only high school dropouts that fail to | | | | to save money and teach them how to handle |
| understand their credit contacts and the factors that | | | | budgeting, lowering credit card bills and how to be a |
| influence their FICO score. I have proctored a lot of | | | | smart consumer and avoid financial trumps ending up |
| seminars to attorneys where I had refused to | | | | in collections. The financially challenged employee is |
| entertain CPA's and engineers who did not have the | | | | worried, confused and is cutting money out of the |
| idea that regular payment of their credit dues every | | | | company bottom line by not making the right |
| month will not enhance their credit score. They also | | | | decisions for the company and by being less |
| had the belief that if they closed their credit card, it | | | | productive in working hours. |
| will foster an unbelievable positive affect on their | | | | A professor of Law at Harvard University, Elizabeth |
| score. They had absolutely no idea regarding the | | | | Warren, presented an amazing fact in one of her |
| manner in which their score influences their insurance | | | | researches. She says that the life-style of the |
| and they did not even know how to read the details | | | | Americans has undergone a change since the 1970s. |
| of their credit report. | | | | The average American today is not spending more |
| According to the Wall Street Journal, "For consumers, | | | | on clothing (which is actually 32% less compared to |
| this increases the importance of understanding the | | | | the expenditure during the 70s), food (here it is less |
| tricks for improving your score. It isn't surprising at all | | | | by 18%), appliances (it's less by 52%) and cars (less |
| that people are confused by the process. Credit | | | | by 24% per vehicle). These statistics are contrary to |
| scores -- the arcane calculations pored over by | | | | the popular claims. Rather, the expenditure is incurred |
| everyone from mortgage lenders to auto dealers to | | | | more on the essentials like house (76% more, this is |
| decide how much they're willing to trust you to pay | | | | taking into account the inflation rate for the same |
| them back -- are growing in importance as their use | | | | size home that would have cost during the 70s), |
| spreads beyond traditional lenders to wireless-service | | | | healthcare expenditure has risen by 174%, car by |
| providers, insurance companies, and even employers." | | | | 54%( we need more than one vehicle, we need two |
| The employee's of today are basically struggling to | | | | wage-earners ), childcare by 100% and taxes by |
| meet their growing financial demands. This is not a | | | | 25%. So, what does this finding actually say? |
| problem that is solely faced by the poor households; | | | | Elizabeth Warren summarizes in her research that the |
| the American middle class who earn $80,000 are | | | | fixed expenses of the average American has actually |
| equally concerned by this problem. This is according | | | | increased from half to ¾ of their respective |
| to the report filed by the Consumer Federation of | | | | earnings. |
| America in 2003. Though the current figures are | | | | Absenteeism, presenteeism (working less than |
| unavailable, but it is a well known fact that the | | | | before), sickness, using time for personal issues are |
| nation's credit card debt stands at over $ 800 billion | | | | just few of the devastating effects of employee |
| dollars. We are also slated to reach the trillion marks | | | | financial problems and the effect of stress spilling |
| in the near future. According to a survey conducted | | | | over to influence the company's bottom line. |
| by the 'In charge educational Foundation', 30% of the | | | | According to the findings of different researches, lost |
| employees are found to be reeling under huge | | | | productivity and higher healthcare cost can contribute |
| financial distress and 28% of them are in absolute | | | | to the loss of thousands of dollars per employee |
| distress. Their situation is defined by the ever | | | | every year. Whereas, financially literate employees |
| accumulating unpaid bills whose due dates prove to | | | | feel more in charge, they are more active and make |
| be a constant reminder of the pressure of the credit | | | | better choices for the company bottom line. |
| card companies. The present day American employee | | | | With the provision of low cost financial education and |
| is plagued with over 30% interest rate; the | | | | changing financial behavior, the employers can gain in |
| astronomical fees and the near hopeless situation of | | | | many ways. They stand to receive: |
| not being able pay back the balance. | | | | 1. A more focused and more productive employee |
| Over the years, the employers have begun to realize | | | | section. |
| that a happy employee happens to be a more | | | | 2. Employees who are able to make better decisions |
| productive employee. Due to the present day | | | | about company issues. |
| financial crisis, every employer is required to put | | | | 3. Lesser amount of sick days and lower insurance |
| emphasis on financial education and help their | | | | rates. |
| employees to compartmentalize their lives. They | | | | In today's environment providing financial education is |
| should be discouraged from using the working hours | | | | essential for the survival of any company. Every $1 |
| worrying away about their bills. | | | | invested brings $3 return. My last book offers a brief |
| But the magnitude of the financial crisis is found to | | | | and essential summary that can protect the present |
| spill over into the workplace today. Over two thirds | | | | day consumer from the newly evolved bank tricks. |
| of Americans are worried about their jobs, imminent | | | | Your order is followed up by monthly a newsletter, |
| needs and their end of the month bills. Employers | | | | which keeps up with the newest information about |
| realize more and more that their employees' financial | | | | credit and everyday personal finances. |
| worries are creating a substantial impact on their | | | | I am humbled by the fact that Maria Shriver |
| businesses. In the present day economy many of the | | | | recognized my efforts by observing through her |
| businesses do not have the money to offer financial | | | | statement, "I applaud you for writing a book ...I |
| relief for rising gas or food prices. However they can | | | | admire your passion to educate people on the |
| surely offer financial education to help the Americans | | | | amazing benefits of maintaining good credit. |