Frequently Asked Questions
1. What can I expect working with a financial/money coach?
We will walk alongside you and provide information and guidance focusing on you becoming proficient in these 5 areas:
Learn to develop and rely on a written cash flow plan/budget.
Getting out of debt using your most important tool – your income.
Living on less than you make.
Giving.
Saving and investing using your most important tool – your income.
2. Ramsey financial coaches recommend that I cut up my credit cards. Why is this so important?
American's incomes have grown faster than the cost of living over the past decade, which is great news for many consumers’ budgets. But American's consumer debt — including auto loans, student loans and credit cards — continues to rise.
Credit card balances carried from one month to the next hit $443.96 billion in September 2019, according to NerdWallet’s annual analysis of U.S. household debt. Credit card debt has increased almost 6% in the past year and more than 34% in the past five years.
Some households are more likely to carry credit card balances than others. This year’s report looked at the costs of first-time parenthood and found that parents of children younger than 18 are more likely to carry credit card balances than are Americans with adult children or no children, according to a survey of 2,076 U.S. adults, commissioned by NerdWallet and conducted by The Harris Poll. Our survey also found that many Americans would have a hard time avoiding debt if they became first-time parents now.
Debt carried over from one month to the next is revolving debt and usually incurs interest charges. The average U.S. household with revolving credit card debt has an estimated balance of $6,849 [2], costing an average of $1,162 in annual interest [3].
Many Americans will likely pay credit card interest for a long time: 10% of Americans with credit card debt say it will take them longer than 10 years to pay it off, and 9% don’t think they’ll ever be completely free of it, according to our survey.
To schedule an appointment: https://calendly.com/shenayim-group-mobile
3. New cars and trucks are heavily marketed to Americans. What is the danger of purchasing a new vehicle with an auto loan?
With the average car payment up to $550 for new vehicles, Americans are taking on auto loans in record-setting amounts and for longer stretches. To get the full picture of auto loan debt and trends in the U.S., we looked at auto loan originations, prices, term lengths and delinquencies, among other aspects of auto debt in the USA. Here are the numbers.
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Auto debt makes up 9.5% of American consumer debt.
On average, Americans take out about $51 billion in 2.3 million new auto loans each month.
Americans borrow an average $32,480 for new vehicles and $20,446 for used.
The average loan term is 69 months for new cars, 35 months for used and 37 months for leased vehicles.
4.5% of outstanding auto debt is at least 90 days late and another 7% is 30 days overdue.
The average auto loan APR was 8.06% in 2019, but ranged from an average of 5.66% for borrowers with the strongest credit to 21.54% for borrowers with poor credit.
People with 720+ credit scores originate more auto loan debt than the rest of the credit tiers combined: $27 million vs $23.3 million.
Americans younger than 45 take out $38.1 million in auto debt, compared with the $13.3 million auto debt of older generations.
Gen Xers are the most likely to have a car loan, and carry the highest auto loan balances with a median of $19,313.
The average price of a new, light-duty vehicle is $38,948, a 1.7% increase over the same period a year prior in December 2018. Average used car prices are nearly half — $20,683 as of Q3 2019.
Author ….Jenn Jones…..Sources: LendingTree, Consumer Financial Protection Bureau, Federal Reserve, Federal Reserve Bank of St. Louis, Edmunds, Kelly Blue Book, Experian, Federal Reserve Bank of New York.