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Monday, June 10, 2013

Students, no financial risks this Summer- MYTH

Financial tips for college graduates
(With a few edits, the entirety of this post is from the Oregon Department of Consumer & Business Services.  Very well done.)

(Salem) – Heading out into the world, college graduates need to be mindful of decisions that can have long term effects on their finances and know where they can get help.  “Getting off to a good start financially will make life a lot easier and gives people more financial options down the road,” said Patrick Allen, director of the Oregon Department of Consumer and Business Services.   “It is much better to take the time now and plan for your future than later wishing you had.”

Here are financial tips in a few key areas: 

Health insurance: If you land a job that doesn't offer insurance, remember that you can stay on your parents’ plan until age 26 – and you do not have to live at home, be a student, or be a dependent on your parents’ tax return. You may also buy an individual policy directly from an insurance company or through an agent. As of Jan. 1, 2014, many young people will qualify for Medicaid, the state health insurance program, or subsidies to help pay for private insurance. Visit starting in October to shop.

Credit rating: Go easy on the credit cards. Your credit score will follow you. A poor score may force you to pay more or result in rejection for everything from insurance to a home loan to credit cards. If you need help managing debt, the Division of Finance and Corporate Securities can help you find a licensed and certified nonprofit credit counselor. Call 503-378-4140. Meanwhile, the federal Consumer Financial Protection Bureau has lots of information about credit scoring.  [And on the other hand, to build a credit score you need to incur some debt.  I recommend a very low limit credit card that pays points and which you pay off every month. GD]

Start saving: Even though you may have little left over after paying bills, putting away even a small amount starts a habit that will pay big dividends later. More than half of Americans said they are worried about a lack of savings, according to an annual Financial Literacy Survey conducted by two nonprofit organizations. This page links to tools that explain how to save:
[On the other hand, if you have any debt- especially any debt costing you an interest rate higher than you can safely earn -pay that down first. GD]

Renter insurance: If fire destroys your rental apartment or house, the owner’s policy will cover the structure but not your contents. If you have a lot of electronics or other expensive items, or if you lack the money to replace what you do have, you may want renter insurance. The cost averages less than $15 a month in Oregon. And, it covers your personal liability if someone is injured because of your activities on or off your premises (say your dog bites someone). [Perhaps even more likely to happen is your inadvertent damage to the building, which is also covered to varying degrees, depending on the company.  Most policies cover your possessions anywhere, not just in your apartment.  (be mindful, however, of exclusions and limitations- ask your agent!)  And if you already have car insurance on your own, adding  a Renter's Package may give you discount on your car premium. GD].

Help with finance questions: The Department of Consumer and Business Services regulates many financial services and industries. Consumer insurance advocates can answer insurance questions and are available from 8 a.m. to 5 p.m. Monday through Friday. Call toll-free in Oregon: 888-877-4894. If you have questions about consumer loans or people offering to help you manage debt, the Division of Finance and Corporate Securities can help. Call 503-378-4140. [Or, if you want greater expertise, call me.  GD]

The Department of Consumer and Business Services is Oregon’s largest business regulatory and consumer protection agency. Visit Follow DCBS on Twitter:  Receive consumer help and information on insurance, mortgages, investments, workplace safety, and more.

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