Credit 101

If you’ve ever applied for a loan or financing, such as when buying a car, you’ve probably been asked about your credit score. However, according to a recent survey, the majority of Americans do not know their score or what a credit report is. Your credit report is an important source of information. By understanding what it is and how to maintain or improve it, you can save money in the long run.

What is a credit report?

A credit report is a biography of your credit use. Your report has a list of all debts you have taken on, from student loans to credit cards. If you’ve ever applied for a credit card, that will show up too. Inquiries others have made into your credit — such as a landlord or car dealer checking your background — will also be listed.

Despite what ads you may see advertising credit reports for a fee, your credit report is completely free for you to access once a year. To get your free credit report, visit AnnualCreditReport.com or call 877-322-8228.

When you get your report, check it over for any discrepancies or issues. You may find a credit card you did not open, a typo affecting your report or even evidence of identity theft. By getting your credit report, you can tackle these issues right away and get them removed from your credit report.

What is a credit score and how is it different from a credit report?

A credit score is a three digit number that is based on your credit report. The score lets lenders know your credit worthiness — that is, how likely you are to repay your debt on time. Scores range from 300 (the worst score) to 850 (the highest). The higher the score, the better off you will be. Individuals with strong credit scores — 750 or above — can get lower interest rates on loans. If you have a poor credit score, you may not be able to get a loan at all, which will limit your options when shopping for big items, like a car or a mortgage.

Several different factors affect your credit score. These include:

• Credit utilization: This is how much you use your credit cards. The lower your credit card balance, the better.
• On-time payments: This is how often you make your payments on time. The more on-time payments and fewer late payments, the better a candidate you are to lenders.
• Derogatory marks: This is the amount of major issues on your report. This can include bankruptcies, accounts sent to collections, or a tax lien against you.
• Variety of accounts: This is the different types of credit you have. Lenders like to see you can carry debt responsibly, so having a range of credit — such as a credit card and a car loan — is actually beneficial to your score.

Your credit score is not part of your free credit report. To get an actual credit score, you will need to purchase it. Reputable sites include Experian, TransUnion and Equifax.

What if my score isn’t good?

Don’t panic. Your credit score isn’t set in stone and you can take steps to improve your score.

1. Be on time: Above all, make your payments on each account on time. Even if you can only afford to pay the minimum, it’s better to pay that amount for each account on time every month.
2. Apply for credit wisely: While credit card reward offers can be tempting, applying for several different cards will raise eyebrows for lenders. Only apply for cards you really need and if you will use it — and most importantly — will pay off it on time.
3. Minimize your overall debt: Pay down your debt to keep your credit utilization low and your credit score up. Pay a little extra each month to bring your debt down.

Now that you know about credit reports and credit scores, get to work! Use that information to improve your credit health. It will go a long way to help you save money and protect your financial future.

Heart of Florida United Way is focused on addressing the five major building blocks of financial stability in order to provide low-income working families the services and support necessary to succeed. For more information visit www.hfuw.org or if you are in need of assistance, call 2-1-1, our 24-hour Information and Assistance helpline.

Top 10 Tips For Thrift Store Shopping

Way before Macklemore’s “Thrift Shop” hit the charts, savvy shoppers knew the value of thrifting.  Everything seems so expensive now, from gas to groceries, so finding discounts when possible is important. For many basic essentials, like clothing or furniture, thrift shops can be a budget-saver.

For those new to thrifting, it can seem overwhelming. Many of the stores are huge and carry everything from holiday trinkets to books and beyond. Wading through the piles of merchandise to find those gems can be tricky, but the feeling of victory when you find a gorgeous piece for pennies on the dollar can’t be beat.

There’s a science to finding great items at thrift stores, so check out our ten tips for making the best of thrifting trips:

1. Scout out locations: Some stores are picked over and rarely restock. Others are bursting at the seams. Check out thrift stores near higher end neighborhoods; they often have name brand clothing and furniture. It’s not uncommon to find Banana Republic, J. Crew and Theory pieces with the tags still on for just $4.
2. Put technology to work: While Goodwill and Salvation Army are thrifting treasures, there are other thrift shops around that offer great deals too. Use thethriftshopper.com to find new thrift shops near you, complete with their location, hours and weekly specials.
3. Get outside your comfort zone: It’s never a good idea to go thrifting with a definitive mindset. Instead of looking for a “purple blouse”, focus on a more general idea like a “work-appropriate blouse.” It helps you keep an open mind as you look for beautiful things in good condition.
4. Take advantage of the seasons: When seasons change and milestones hit (like back to school), people tend to clean out their closets and homes, which means thrift shops become a bonanza of great items. Shop now to stock up on school clothes, new furniture or seasonal décor.
5. Figure out your location’s schedule: Most thrift shops accept and process new stock on the weekends, so Monday through Wednesday is when they’ll have the most selection.
6. Don’t forget sales: Many people don’t realize that thrift shops have sales too. On certain days, all furniture or clothing will be marked down as much as 50% so check with your local shop for their sale schedule. Some shops also offer discounts for college students, seniors or veterans so be sure to ask about available discounts.
7. Be strategic: Thrift shops tend to have strict rules about how many items you can bring into a dressing room and leaving an item behind may mean it gets scooped up by someone else. Wear form fitting clothes so you can try on sweaters, coats and blazers right over your outfit to skip the dressing room entirely.
8. Be thorough: Be sure to check the garment all over for stains, tears or holes. Bring a to-go stain remover like Tide to Go Sticks to test if stains can be easily washed out.
9. Imagine blank slates: Try to see past the initial item. That wardrobe may have plenty of signs of wear, but with a little work it could look modern and new. Paint, new handles or hardware can make that $10 piece of furniture look like an expensive addition to your home. Pinterest can provide great ideas on how to easily (and cheaply!) repurpose thrift store finds.
10. Make sure you need it: It’s easy to get too excited by the bargains. When you get 10 shirts for $30, it can be tempting to load up the shopping cart. But even at bargain prices, it’s a waste of your hard-earned money if they won’t get used regularly and if you don’t love them. Shop thoughtfully.

Finally, remember to give back to the thrift stores you shop! After closet or home purges, drop off gently used items at your local store so that other people can share in the experience and savings too.

Heart of Florida United Way is focused on addressing the five major building blocks of financial stability in order to provide low-income working families the services and support necessary to succeed. For more information visit www.hfuw.org or if you are in need of assistance, call 2-1-1, our 24-hour information and assistance helpline.

10 Tips to Rock Your First Day at a New Job

Whether it’s your first job after graduation or you’ve been part of the workforce for decades, starting a new job can be terrifying. From meeting new people to learning where on earth the coffee machine is, getting through that initial day can be confusing and overwhelming. With some preparation and research, you can arm yourself for a fantastic day, making a great impression to get you started on the right foot.

1. Nail Down a New Sleep Routine: If you’re used to college life or have been out of work for a while, staying up late and sleeping till noon may be normal for you. That routine will make that first day of work much more difficult; you’ll have a hard enough time remembering names without being exhausted too. Set yourself up for success by starting a new sleep schedule. If at all possible, give yourself a week or two to adjust to going to bed early and waking up in plenty of time to get ready for work.
2. Map out your route: The last thing you need to worry about on your first day is traffic or getting lost. Do a test run to work to find out how long your commute will take you during rush hour, and use a map or your GPS to figure out a few alternates in case of an accident or traffic jam. If you take public transportation, make sure you have the bus or train schedules and plan on taking the earlier route to give yourself a buffer to get to work.
3. Do some online research: Spend some time Googling your new employer and check out their social media pages. This will help you know the major issues and key people to know within the company before you ever walk in the door, which will help prepare you for what challenges you’ll face.
4. Pick out a snazzy outfit: Pick out your outfit before the big morning; it will make everything go so much more smoothly for you. Opt to be a bit more conservative until you know your new office’s culture and what the standard of dress is amongst your coworkers.
5. Stockpile some food: Your boss and your new team may take you out for lunch, but don’t plan on it—you may end up going hungry. They may be busy or it may not be the office norm. Pack a lunch and some snacks that you can keep at your desk in case you’re on your own. Having some food on hand will help keep your energy up. Bring some cash and change in case you do go out for lunch with your teammates.
6. Ask questions: Don’t be afraid of looking foolish. The company hired you because they thought you were capable. You’re supposed to ask questions when you’re new! Just time them appropriately. Rather than popping into your boss’ office several times a day, write down your questions and ask them all at once so you don’t constantly interrupt her train of thought.
7. Take notes: Along with those questions, make sure you take tons of notes. From little reminders about who is who (i.e. long red hair=Jen) to copier codes and procedures, your notes will keep you from annoying people by asking the same questions over and over again.
8. Be prepared: Make sure you have everything you need, from paperwork HR asked you to fill out to remembering your social security card and ID. This will make the orientation process so much simpler and let you get started without a problem or delay.
9. Then listen some more: You’re eager to prove yourself and that’s awesome. But before you start making suggestions or doing things a different way, spend your first few days and weeks listening and understanding the rationale behind procedures. There may very well be a solid reason why they do things a certain way, so make sure you understand that before making suggestions. Once you’ve learned the ropes, if you find a way that would save time or money or increase results, by all means, speak up!
10. And breathe: You’re going to be nervous your first day and that’s okay. Take some deep breaths when you feel overwhelmed, smile, and ask for help from your new coworkers. You can do this!

Heart of Florida United Way is dedicated to changing lives for the better by helping families and individuals gain access to resources they need to stay afloat and succeed financially. For more information about Heart of Florida United Way’s efforts to improve employment and financial stability in Central Florida, visit www.HFUW.org.

13 Ways to Prepare for an Income Reduction

This article originally appeared on “Surviving and Thriving” and has been reposted with permission by Donna Freedman.

A reader suggested an article on preparing for income reduction. Not layoff or job loss, but rather a partial loss of expected funds – salary reduction, an end to child support and the like.

“Where you still have a job, but really need to evaluate the ‘new budget’,” she says.

I’ve written on this subject before, calling it the “financial fire drill.” You figure out how little you can get away with spending – and you do it with an attitude of calm preparation, not fear of deprivation.

This baker’s dozen of tips will get you started.

1. Figure a baseline budget. This is the absolute minimum needed for basic shelter, food, utilities, and mandated payments like child support or student loans. Best-case scenario: Trimming some budgetary fat partly or mostly offsets the income reduction.
2. Track current spending. If you haven’t got a budget, build one – with pen and paper or with a free online tool like Mint.com. Again: Knowing where it’s going can show you places to cut.
3. Pay down any consumer debt. Trimming some budgetary fat, as noted above, can give you extra bucks to throw at debt. Two other potential tactics: Try to negotiate a lower interest rate or see if you can get a balance transfer.
4. Ease off on prepayments. Have you been paying extra on your mortgage or your student loans? Redirect that money into savings; as my MSN Money colleague Liz Weston points out, even a $500 emergency fund can make a huge difference.

Cut some costs

5. Re-think your auto. Can yours be a single-car or even a car-free household? If so, sell or garage one vehicle. Don’t cancel your car insurance outright, since it can be hard and/or expensive to get back in. If you truly need wheels, then talk to your agent about raising your deductible. While you’re at it, look for a better insurance rate.
6. Inventory your stuff. Is any of it saleable? Somebody paid $1,200 for my little plastic statue of Bob Feller.
7. Cruise frugality sites. May I suggest the following: my site (of course!), The Dollar Stretcher, Wise Bread, Get Rich Slowly and I Pick Up Pennies. May I also suggest that you incorporate changes gradually, so that you don’t burn out?
8. Seek utility discounts. Some have reduced rates for people in reduced circumstances.

Just in case

9. Got kids in school? Talk to the financial aid office; a change in circumstances might mean your scholar is eligible for additional help. (Avoid more loans, though.)
10. Still paying your own student loans? Learn about forbearance now, before you need it.
11. Know what’s out there. Go to Benefits.gov to learn about the Supplemental Nutrition Assistance Program and any other programs for which you might be eligible. Check local resources like food banks and public health clinics, too; visit the 2-1-1 page for links to services in your area. As with forbearance, find out these programs before you need them.
12. Seek a side hustle. Even a few extra dollars could be a huge help. See “Can’t get a job? get a microjob!” for specifics.
13. Think about boarders. Maybe a friend or relative (or a grad student) needs a room. Or check out home-stay programs like Airbnb.com and Roomorama; one couple I interviewed pays most of the mortgage this way.

Does all this sound drastic? Remember, you don’t have to do all of it – and you might find more suitable ways to cut costs.

Attitude is as important as any frugal hack. This is not about deprivation, but rather about smart use of available funds. If your income is reduced your outgo better shrink, too. Continuing to live the way you always had would be financial suicide: Those credit-card bills will keep coming in whether or not your ship eventually does.

Readers: Have you had to (or did you want to) cut spending? Got any advice to share?

Donna Freedman has been making a living as a writer for 31 years, the last eight of them as an online freelancer. She recently compiled her expertise into an online course called Write A Blog People Will Read; follow the link for a 25 percent discount.
Heart of Florida United Way is dedicated to changing lives for the better by helping families and individuals gain access to resources they need to stay afloat and succeed financially. For more information about Heart of Florida United Way’s efforts to improve employment and financial stability in Central Florida, visit www.HFUW.org.

5 Job Searching Tips for New Grads

Graduation is coming up fast. Along with graduation parties and relief that finals are done comes another milestone—it’s time to enter the real world and get that first job.

For new grads, this can be a scary prospect.

With some preparation, grads can confidently start their job search and land that coveted position. Here are 5 tips to help get started in a tough job market:

1. Get Started! The job search process can be quite extensive and prolonged. From the time you submit a resume until you get hired can take up to three or four months. A fresh grad with little experience may find it takes even longer to find a position. Start looking for jobs in your industry before graduation if possible so you can get the process in motion.
2. Tailor Your Cover Letters to Each Job: Don’t just use one generic cover letter for each application. Write a new cover letter for every position. Include specifics about how you are the best fit based on the job description and show your enthusiasm for the industry and company.
3. Do Your Homework: Sorry guys! Homework isn’t done yet. Research companies you plan to apply to before submitting your application and interviewing. Make sure you understand what that company does, what their culture is like, and who their competitors are. Having a strong foundation about the company will set you apart.
4. Have Strong References: Make sure you have solid references lined up. As a new grad, your references can be managers from internships, volunteer organizations, or professors. Let your intended references know when you start applying so they’re prepared for that phone call.
5. Clean Up Your Social Media: Senior week and graduation pictures are fun, but may give the wrong idea to your future employer. Spend some time cleaning up your social media pages to ensure you are promoting yourself as professionally as possible. Delete pictures if needed, reset your privacy settings, and make sure you come off as a competent, reliable professional.

Heart of Florida United Way is dedicated to changing lives for the better by helping families and individuals gain access to resources they need to stay afloat and succeed financially. For more information about Heart of Florida United Way’s efforts to improve employment and financial stability in Central Florida, visit www.HFUW.org. 

Using the Cash Envelope System

It’s easy to break out the credit card for routine purchases like groceries, gas, clothes, and fast food. The convenience can’t be beat, but using that credit card can cause you to spend more money that you intended and rack up debt. According to a recent study, people spend up to 18% more when they use a credit card rather than cash.

The envelope system is a great way to get a handle on your spending and help you keep to a budget. It’s easy and requires no special tools or software, just some plain envelopes.

To get started with the envelope system, follow these steps:

1. Make a budget: Review your spending over the past month and your bills. Bucket your expenses into categories, such as rent, groceries, gas, cable, etc. Then create an envelope for each one and label each envelope with a category.
2. Fill your envelope: Set aside the amount of money for that week for that category in each envelope. For instance, if your grocery budget is $400 a month, you would put $100 in that envelope for the week.
3. Spend! The fun part! Spend your envelopes on each category as needed. The important part is not to borrow from one for another category—no raiding the grocery budget to pay for shoes! If you run out of money in any category, spending is over.
4. Adjust: If at the end of the week you have any money left over, deposit the extra amount into savings or pay down debt. Even an extra $5 each month can make a difference over time.
5. Refill the envelopes: At the start of the next week, refill the envelopes and start again.

If you’re used to carrying a credit card, it may take some time to get used to the envelope system. But give it time. Adjusting to a cash system will make you more aware of your finances and spending, helping you keep on budget and build your savings.

Heart of Florida United Way is focused on addressing the five major building blocks of financial stability in order to provide low-income working families the services and support necessary to succeed. For more information visit www.hfuw.org or if you are in need of assistance, call 2-1-1, our 24-hour information and referral helpline.

Dress2Learn Delivers New School Clothes and Hope to 5,400 Local Homeless Students

The day that Jenny Gibson-Linkh, principal at Evans High School in Orange County, discovered a student washing her clothes in the bathroom sink after school was the day she realized that clothing was a significant need among her homeless students. It’s estimated that more than 10,000 students in Orange and Osceola counties are homeless and are faced with many challenges – both personally and academically.

“It’s not just about dressing to look good or feel good, although that is significant to a student’s self-esteem, but it’s also to improve attendance, to provide the opportunity to stay on track academically, to graduate and ultimately move on to that next step in life. We may not think of clothing as a significant need, until you’re the one without it.”

In October 2014, Heart of Florida United Way launched Dress2Learn, a clothing program for homeless students in Orange and Osceola counties. As a result of the program this year, more than 5,400 homeless students across 250 schools received new Levi’s brand apparel. Jeans, khakis, shorts, polo tops and graphic tees were distributed to K-12 children in need. Not only is it about attendance and performance in school, but it’s also about relieving the financial burden of purchasing clothing for growing kids.

“When parents are concerned about keeping a roof over their kids’ heads and putting food on the table, clothing is a need that gets pushed down the priority list,” said Robert H. (Bob) Brown, president & CEO of Heart of Florida United Way. “Through Dress2Learn, we hope to level the playing field for our homeless students and allow them and their families to focus on next steps beyond their current situation – whether that’s graduating or regaining stability.”

Evans High senior Romicha Baker was one of the 5,400 recipients of the Dress2Learn program.

“I’m glad that I have the help because there are people who make jokes out of what you wear and pick on you,” Romicha said. “It makes it harder to be in an environment where you’re supposed to learn when people are laughing and then get the whole class laughing at you. I used to worry about that. I’d go into class quiet, sit in the back so I wouldn’t have anyone laughing at me.”

Not only did Dress2Learn provide Romicha with a new set of fitting clothes, but also a renewed sense of hope.

“When I heard about [Dress2Learn], I thought this would be a way for me to actually sit up front and not have to worry about what other people have to say and try to graduate like the others.”

It’s easy to see the interconnectedness of United Way’s focus areas – education, income, health and basic needs – through Dress2Learn. A balance must be achieved in all four of those areas for stability. Although, United Way believes that education is the change maker: get kids to focus in school, they may be able to break the cycle. And sometimes, it’s something as small as a new t-shirt to get them there.

“I think sometimes we forget that it’s the little things that make the biggest difference in education,” said Gibson-Linkh. “We focus on test scores … we focus on curriculum … we focus on all the assessment, and sometimes we forget about the child. We forget about the basic necessities. We forget about them as a human. Dress2Learn brings it back to them and puts them first. I’m glad we’re doing this because our students should always be first.”

To learn more about ways you, your company or organization can get involved with Dress2Learn, visit UWDress2Learn.org. Just $50 can supply one homeless child with a full complement of school clothes. Fundraising for the program is year-round, so your help is always needed and welcomed. Thank you!

National Day of Service Focuses on Financial Stability

This past Martin Luther King, Jr. Day marked the sixth annual, “Financially Fit” Campaign put on by the Volunteer Resource Center of the Heart of Florida United Way. Volunteers carried on MLK Jr.’s legacy of creating solutions to various social problems during this National Day of Service by distributing crucial information regarding free tax preparation services through the IRS’s Volunteer Income Tax Assistance program (VITA), and the Earned Income Tax Credit program (EITC). Last year alone, more than $600 million was returned to Central Florida residents through EITC.

Thousands of low- and middle-income residents in Orange, Osceola, and Seminole counties received door hangers with VITA and EITC information, as well as information on United Way’s 2-1-1 Crisis Helpline, which also aides residents in qualifying for free financial services. Over 40 volunteers, including AmeriCorps VISTAs and Pathways to Success members, participated in this initiative designed and implemented to help people achieve financial stability, which is one of HFUW’s four Investing in Results goals.

In total, an estimated 100 volunteer hours were logged over the course of the day, and nearly 6,000 low-income homes were reached. The volunteers not only provided much needed outreach to the Central Florida community, but also helped in fulfilling one of MLK Jr.’s last goals of solving economic injustice.

5 Financial Fitness Tips for this Tax Season

Come January, you and many others will start thinking about holiday indulgences and the need to get fit.  While some will be thinking physically fit, others may be thinking financially fit. For the latter, United Way has some tips to consider adding to your tax routine this year.

1. Determine if you’re eligible for EITC. The Earned Income Tax Credit is lauded as the most effective federal program for lifting children and families out of poverty. In Orange, Osceola and Seminole counties, more than $2.5 billion in credits have been claimed over the past seven years, including more than $570 million distributed in 2012. But still, the IRS estimates that one in four qualified taxpayers misses out. If you’ve worked at least one day in the past tax year, you may qualify based on your income and number of dependents. See income limits by clicking here.
2. Find a free VITA tax prep site. With more than 30 throughout Central Florida, there is bound to be one near you to help walk you through filing your taxes, claiming EITC and answering tax-related questions. Volunteer Income Tax Assistance (VITA) sites allow taxpayers to keep hard-earned money in their wallets.
3. Text “mymoney” to 898-211 for timely info and tips. Navigating the system is tough. United Way offers quick tax-related updates via text message for those who subscribe.
4. File your own taxes online for free. If you’re comfortable with technology, use MyFreeTaxes.com. This free site will even factor in the Earned Income Tax Credit and others to make sure you’re getting your maximum refund.
5. When in doubt, call 2-1-1. Specialists are standing by 24/7/365 and can help you get the information you need when it comes to tax help or any other community resource.