Student Loans - The new crisis haunting many Americans


Browsing through recent financial news articles, student loan debt of Americans is being described by many sources as a new Crisis.

More than 40 million Americans have student debt. Many of them are struggling with just meeting minimum required down payments and many will never be able to pay their loans off. According to the Federal Reserve, the amount of student loans nationwide has tripled to more than $1.5 trillion over the past decade.  Especially Millennials, also named Generation Y, which describes the generation of 23-32 year olds, are struggling with student debt.

College tuition keep rising year over year along with living expenses. Many students are forced to take part time jobs to minimize their needs for loans and instead end up extended the length of their education. The average student loan of millennials hover around $35,000. Loans based on longer degrees and degrees from private and more prestigious colleges well exceed $100k. On top of that, many millennials rely on credit cards with high interest rates and private family member loans to supplement their student loans.

With most graduates looking at entry level jobs paying low minimal wages, student loans in those ranges take years if not decades to pay off. It really is a vicious cycle causing significant anxiety and stress for this large young population of Americans. In order to meet their minimum required monthly payments, many work multiple jobs and long hours. Not meeting those payments will continue to increase their debt and impact their credit score and future ability to reach goals in life. 

As a result, traditional life events and milestones such as buying a car, getting married, investing a home, starting a family and investing for their retirement are being postponed until later in life. Those things were typically within reach of Baby Boomers in their mid-twenties. Millennials can easily add another decade before they reach that point. Home ownership for 24-32 year olds dropped 9% from 2005 to 2014.

All this re-enforces the importance for young people to become fluent in managing their financial lives. Most young students are faced with the need to make very important life decisions related to education and financing of their education without proper financial knowledge or experience. Those early decisions will haunt them and guide their future opportunities for years to come and for some for the rest of their lives. Young people need to understand how to plan and manage all aspects of their financial lives and master important skills such as prioritization, budgeting, account balancing and use of credit cards as early in life as possible. Even after the “damage” has happened, mastering those skills after getting their first paychecks, can make the difference between successfully fulfilling common life goals and dreams of establishing a family and home ownership, and not. Larger companies are starting to realize the need to help their young employees by offering Financial Wellness plans and seminars. For Millennials, planning for the rest of their lives is never too late.


*Sources: “Experian”, “Federal Reserve”

Seasons of Change with Your Personal Finance Plan


Autumn comes on Monday, September 23rd, where summer afternoons wain and the crispness of fall mornings begin. This is a great time to take stock of your personal finances, before Halloween, the Holidays, and the New Year come upon us. The question that should really be asked is: do you know what a personal finance plan entails? As the seasons change, so do your needs and wants. Developing your plan will get you more organized and in control of your savings goals. However, the life stage you are in - Boomer, Gen X, Millennial or Gen Z - will help determine the elements of your personal finance plan.

Saving is the Foundation

Saving is the foundation of a personal finance plan. Many Americans do not save because we are taught from a very young age to spend. In other words, we live in a highly developed, consumer-oriented culture. Everyone should open a savings accounts at a local bank or credit union. Deposit money from each paycheck that can cover emergencies, loss of a job, or something special (vacation, technology, car or household appliance.) It will earn some interest, and you begin a discipline for your entire life.

Financial Goals Guide

Financial goals will help guide the plan once savings are established. Review what is most important in your life over the next several years. Goals are: short-term (less than one year) ~ such as saving for a computer or a weekend away; mid-term (one to five years) ~ such as saving for a car or vacation; and long-term (greater than five years) ~ such as saving for a house or college. The goals will change as you age and enter into different life stages. Each person's goals are different depending on their needs and wants.

Monthly Budget Plan and Enforce

A monthly budget is important to help lay out income and expenses and enforce good saving habits. Income is usually the same in each period. Expenses will change based on time of year, monthly events, and saving goals. The result of the budget should be Income Minus Expenses Equals Zero. Goals can be broken into expense categories for better tracking purposes such as emergency, job, and car savings. There are many apps - Mint, Everydollar, and Truebill - to assist you with budgeting, or consult an expert to guide you through the process.

Managing Consumer Debt

Consumer debt is a part of the American way. Managing it is an essential part of the personal finance plan. Home and student loans make up the largest portion of outstanding balances of credit in the country. The reason to save and budget is to help reduce the need for debt. Many believe it is important to have credit cards and other loans to build credit. However, Americans typically skip over saving and budgeting and go straight to living on credit. There are times when loans are needed to survive in our high-priced society. Ensure the budget categories - mortgages, credit cards, and other loans - are properly expensed to maintain a good credit history.

Personal Finance Plan Constructed

The personal finance plan is constructed as each element - saving, financial goals, budgeting, and debt management - are built and put into place. Retirement, insurance, and real estate planning are also important. However, they can only be effectively utilized as long as the rest of the plan is completed first. Estate and taxation planning are other areas to consider as well. The plan should be reviewed and changed annually, making it a living and breathing document. There is no time like the present season to begin the personal finance plan process.

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Your Senior High Children and Their Finances

Graduation .jpg

At this time of year, children are heading back to school. Many are beginning their Senior high year - excited with the anticipation of activities, college applications, and graduation. For parents, the big question is how the parent will finance their college careers. If you already have the answer, move on to another pressing matter: How do you prepare them to handle their own finances once they leave home?


Teaching your kids to save now is imperative to the success of their financial health. You can lay the foundation, showing them that saving for emergencies and items they need (or want) to purchase - smartphones, cars, and spring break trips - can help keep them out of a bind financially. Start the conversations now, but try to keep it short or they will lose interest.

If you have not done so already, take your teenager to your credit union or bank and have them establish a savings and checking account. Let them go through the experience to understand the process of banking. They will eventually understand that part of moving on to the next stage of life is having responsibility for their own accounts, debit cards, and checks. (By the way, everyone can utilize a debit card, so show them how to write a check. This is becoming a lost art!)


For some reason, this "B" (udgeting) word puts fear into the hearts of a lot of people. However, for you and your kids, this exercise should be something you all practice. Show them that it is something as simple as Income - Expenses = Zero. Income is the money coming from paychecks, eBay sales, babysitting jobs, and parents' monthly support. Expenses are monies going out, divided into Needs and Wants. Needs are the areas that are required to live ~ rent, utilities, food, clothes, and gas. Wants are opportunities - gaming, movies, and meals out - once the Needs are satisfied.

Utilize the 50-30-20 expense budgeting method. Once income is determined, take out 50 percent for Needs, 30 percent for Wants, and 20 percent for Savings. These numbers can fluctuate depending on your life stage and area of residence. If there is money left over, put any extra directly into savings. It really is very simple once you get past the intimidation of numbers and spreadsheets. There are apps on the internet - Mint, Truebill, and Everydollar - to help you keep track of all financial transactions and creating user-friendly budgets.

Credit Management

Many people have mixed feelings about credit. Your children can't establish credit until they are an adult (18+). However, talking about it can remove any trepidation that parents may have around this subject. Once the teens understand the power and responsibility of having credit, they will comprehend that credit cards (technically a loan), student loans, and any other "loans" are not just free money. Young adults will be bombarded with credit card offers throughout their college years. Explain that it may be a good idea to have one credit card to begin building a credit history. However, applying for EVERY card that comes along can ultimately hurt them in the long run.

Discuss with your teens all of the different types of loans that may be applicable to them and why they may want to utilize them in their young adult years. Before your kids pursue any type of loan, encourage them to speak to you first for additional guidance. There may be other alternatives instead of going into debt. Loan products and credit history development may not be taught in your particular schools. Reach out to your credit union or bank to see what kind of education they provide for their members and customers. Several financial institutions supply a financial literacy program for clients of all ages.


As you review savings, budgeting, and credit management with your high school Seniors, you begin to create a financial health plan for them. You are building a foundation of trust through these discussions. Although there will be many other details to consider before they leave home, preparing them now about their personal finances will make them more confident to handle the decisions life requires of them. There are many tools and resources online and assistance through your financial institution or local financial health coaches.

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Here's How Gen Z and Their Parents can Combat Financial Stress


Gen Z, and parents, preparing to live financially fit while in college is causing anxiety and stress on the Gen Z population and their parents. How can they prepare better?


It is no longer news that the young Gen Z adults are stressed out and anxious over so many things while in college. This stress and anxiety has resulted in an alarming rise in poor mental health in the United States. About 91% of Gen Z adults have been quoted to have complained about physical or emotional symptoms such as depression or anxiety which is closely connected with stress. Symptoms of their stress include worries about health-related concerns, mass shootings, rising suicide rates, unemployment, sexual harassment, assault reports, with financial worries ranking top. Even the parents of the Gen Z adults are not left out of the financial stress, likely because they experienced financial hardship during the great recession or because the majority of the Gen Z adults still rely on them to help with funding of their college education, which is now very expensive. According to a survey carried out by the American Psychological Association, four out of every five Gen Z adults are worried about money matters.

Who are the Gen Z Adults?

Gen Z is also referred to as Generation Z. They are persons born after 1995 i.e. between 1996 and 2010. They are currently between ages 9 and 23 with the majority of them either considering, applying, attending or graduating from college. Gen Z adults are 18-23 years of age. They are usually referred to as an independent generation who are financially pragmatic, purpose driven, socially smart and possess all qualities of being successful in college but they have grown up in an age rife with financial struggles, high pressure, anxiety and uncertainty.

Many Gen Z adults gain admission into their various colleges without important financial management skills. This increases their anxiety and stress and expose them to financial risk. Many of them lack the skill and ability to balance essential financial management training with common sense pragmatic application. Some of them struggle balancing their studies with college freedom, social engagements and work to financially sustain themselves while in college. Meanwhile some seem academically and socially ready but are challenged psychologically and financially.

Common Traits Associated with Gen Z Adults

Independence and Privacy

The Gen Z adults prefer a life of independence ranging from financial independence, work independence to personal independence. They always want to be in charge of things and situations happening around them. They dislike relying on others for success because of their individualistic characteristics. They also love their privacy and hate intrusion of privacy.

Entrepreneurial in Nature

Gen Z adults are entrepreneurial in nature. They are gradually shifting from the idea of going to school and ending up with desk jobs to having their own businesses and companies. This has been made possible with the internet where they have access to different resources which serve as blueprint for their businesses.


The Gen Z adults are highly competitive in nature. They always want to be the best in all that they do. Competition and impatience seem to be the driving force of this generation.

Where Gen Z Adults Usually Get It Wrong Financially

·       Only about 14% of Gen Z adults know that they ought to keep 6 – 12 months expenses in emergency savings.

·       Only about 29% of them have the knowledge that anyone with many credit cards must close the accounts to reduce the urge of always using the credit cards.

·       About 50% don’t know how to calculate their net worth.

·       At least four out of ten don’t understand that late payments remain on their credit history for 6-7 years even after it is paid.

·       Many Gen Z adults do not know that inflation is included in their return on savings.

·       Four out of every ten student fail to check their account balance.

·       They fail to create or prepare a budget.

·       Many Gen Z adults buy things they don’t need such as things to improve their mood.

·       Most of them buy things way beyond their budget, things they can’t afford.

·       Only about six in ten admit to spending less when their resources are low.

What Can Be Done to Help the Gen Z Adults and Their Parents Combat the High Level of Financial Pressure and Anxiety Gen Z Adults Face During College Life?

Avoiding Debt

Gen Z adults must try to avoid debts at all means and build credit. If this is unachievable, you can obtain small and manageable debts. This grants the opportunity to obtain loans and take out mortgages for very important financial decision later in life.

Educating the Gen Z on smart debt management should be made a priority. This will help them manage their finances better and give them a strong foundation for long term financial planning and preparation.

Educating Gen Z adults on Essential Financial Management

Engaging in financial literacy programs especially at early stages of high school or sooner will help Gen Z adults make excellent financial decisions once they enter college and become first-time independents. For instance, many Gen Z adults lack excellent budget skills, so they need to be taught different methods of preparing excellent budgets to help them manage their spending effectively. Being a college student literally means that you mostly use a credit card as a means of financial survival, so you need a good budget.

The Essential financial management program should include the following courses:

·       Mortgages

·       Renting and buying a home

·       Automobiles investment and other purchases

·       Planning and saving for college debt

·       Credit and credit history

·       Budgeting covering everyday expenses

·       Employment and money management

·       Responsible credit behavior like avoiding late payments

Investing in Mental Health and Well-being

Colleges and companies should invest and pay more attention to the mental health and well-being of Gen Zers. They need mental health counseling and open discussions. There are several online therapy apps such as Talkspace, Breakthrough, Joyable etc. that help in offering mental health services and assessing the emotional well-being of humans. This will go a long way in helping Gen Zers ease pressure, depression and anxiety.

Managing Their Money Themselves

The moment Gen Z adults realize that they can’t build their net-worth until they build their self-worth, they will continue to be under financial pressure. They should learn to manage their money themselves by saving at least 20% of their monthly income.

Working as a Student

Another way of relieving stress by Gen Z adults is to work temporarily during their free hours while in college. This temporary work plays important financial roles. Gen Z adults can apply for temporary work at the following companies: Uber/Lyft,,, Taskrabbit, Ebay, Amazon etc.

Parental Effort

Parents also need to put efforts into educating their children about finances at a very tender age to reduce the financial stress and anxiety faced by the Gen Z adults and themselves. They also need to save up adequately for their retirement to be financially independent.

The education efforts include:

·       Teaching and helping them to prepare simple budgets.

·       Being worthy examples by withdrawing cash to pay for their services rather than the frequent use of credit cards.

Teaching and helping them to save to buy personal stuff by encouraging them to save parts of their pocket money rather than wasting it.

Financial Freedom... Really?


As we celebrate our nation's 243rd Independence Day this month, I am thankful for all those who have given their lives for our freedom.

This holiday also reminds me of our financial freedom. What does this phrase mean? To me, true financial freedom is having savings, investments, and assets where there is no accumulation of debt. It is important to understand that the foundational principles of personal finance include all of the titles listed as well as financial goals and budgeting. In order to be able to save and invest, you must have goals that are measurable and attainable. While figuring your Needs and Wants Expenses during the budgeting process, at least 20% of your overall income should be set aside to help attain your goals. That money should be placed in one of the following accounts: savings, money markets, certificates of deposit, in addition to various other investment options.

The problem is everyone has a different definition of financial freedom. Many consider having a home mortgage as an investment but don't think of it as debt. However, it is still a loan. There are those that define debt as good or bad. There are still others who determine to first pay down loans that are unsecured and more costly. As a nation, we are trillions of dollars in debt. If you have any type of loan - mortgage, auto, credit card, student, or any type of unsecured loan - you are in debt.

Instead of looking for financial "freedom," we should strive for financial "health." Our lives should have a balance between savings, realistic goals, budgeting, and debt management. Our focus has to be more on savings and investments so we can pay for our goals. Beware - life gets in the way! Homes are too expensive, cars break down, and health fails. Debt can help us handle those life events - the unexpected and extraordinary. We need to develop a plan that helps us succeed in having more savings and less debt so we can live and be financially healthy.

Types of Financial Fraud and Scams Hitting US Senior Citizens


According to reports and statistics, at least one in every eighteen cognitively intact senior citizens of the US fall victim of financial fraud and scams annually. This is roughly 5.4% of the country’s senior citizens.

A 2015 report puts the estimate of the money lost by senior citizens to financial fraud and scams at $36.5 billion each year.

With the number of senior citizens impacted by financial fraud and scams rising in leaps and bounds with each passing day, the U.S. Centers for Disease Control and Prevention, citing the research works of Mark Lachs, has stated, that ‘abused seniors die at a rate three times faster and are four times more likely to go into nursing homes than those who haven’t been abused.’ This means that they forfeit their life savings, cars, homes and their health starts deteriorating faster. The sad reality is that these financial frauds and scams are being perpetrated by both close relatives and strangers.

Over time, there has been upgraded lists of various financial fraud and scams tactics commonly employed by scammers to swindle their victims. These tactics will be discussed in detail and include:

IRS and Tax Scams

These scam tactics rank as the highest and most prevalent. These scammers impersonate IRS agents in a bid to deceive taxpayers into paying large sums of money. They make use of emails, unsolicited calls, and texts to request information relating to victims’ financial accounts. Sometimes they appear in person and threaten victims with jail terms, deportation or fines if the victims fail to cooperate.

Sweepstakes & Lottery Scams

So many senior citizens have fallen for this scam. They are contacted and informed that they’ve won sweepstake or lottery prizes and are required to pay certain fees in advance to free up the prize.

Telemarketing Fraud

This is another type of scam that is prevalent in the US. Fraudulent telemarketers impersonate persons of authority to swindle victims by requesting their personal and financial information.

Sometimes telemarketers inform victims that they’ve won a trip or prize and need to send some advance taxes or fees to claim it. The victim might also be asked to share certain financial information. This type of scam is relatively successful because there is no form of physical meeting.

Online Dating Scam

Online dating scam is fast becoming popular and gaining ground. Knowing fully well that we are in technologically advanced age, scammers take advantage of several social media outlets such as Facebook, Snapchat, dating sites and so on to perpetrate financial fraud and scams. They create fake profiles and forge relationships with their victims, swindling the victims of large sums of money in the process.

Scammers sometimes act as members of US military to engage in online dating with victims, earning their trust and requesting money from them in the long run.

Scam Targets Seniors to Unknowingly Transport Drugs Internationally

Scammers reach out to senior citizens offering them luxurious overseas vacations. But they are unknowingly used to transport drugs internationally. The victims are promised several juicy packages to do this. When these victims are caught, they risk arrest and detention.

Tech Support Scams

One of the fastest rising scams in the US is the Tech Support Scam. The scammer pretends to be a representative of tech firms like Apple, Amazon or Microsoft. They deceive their victims by telling them that there is a problem with their computer and take advantage of their concerns. They try to gain remote access to their victims’ computers, steal sensitive personal information or change the settings on  the computers leaving it vulnerable to further fraudulent activities.


The Grandparent Scam

Scammers often call, text or email senior citizens tricking the victims into believing that they are family members in trouble or in serious need of help. The scammer subsequently requests financial assistance to get them out of trouble. After scamming victims of their money, they are mostly advised to keep the request confidential and not to tell anyone.

Mortgage Scams

Scammers may pressure senior citizens into taking inappropriate reverse mortgages or loan and using the equity gained from the reverse mortgage to invest in costly annuities, which may not mature until the victims are deceased.

Health Insurance Scams

Senior citizens are highly susceptible to this type of scam. The scammers act as as a Medicare representative and swindle the victim by asking for the payment of certain fees to upgrade their database.


Charity Scams

Senior citizens also fall victim of charity scam by making donations to scammers who pretend to be owners of charity establishments or hosts of charity shows.

Counterfeit Prescription Medications and Fake Anti-Aging Products

Senior citizens sometimes fall into the hands of scammers when they attempt to buy prescribed medications at much cheaper prices. These scammers sell counterfeit drugs that can cause damage to the victims’ health.