Financial literacy can help us avoid economic pitfalls.
Diane Colozzi, a patient access rep at Community Hospital in Syracuse, N.Y., struggles with $160,000 in student loans.
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The first action working people can take to defend themselves against financial abuse is to sign a union card. Membership in an honest union puts a brake on employers’ ability to exploit the workforce. Unionized members tend to earn more and receive greater benefits than do unorganized workers.
Good unions, like 1199SEIU, also take the struggle for their members and their families into the political and legislative arenas.
Unfortunately, the last few decades have witnessed the decline of organized labor and the strengthening of the big corporations. With those two trends comes a loosening of the levers of control against the moneyed interests. This has led to an environment in which working people have become fair game for both legal and illegal financial abuses.
No sooner than we pick up our paychecks, we confront a gamut of institutions and individuals just itching to put their hands in our pockets and pocketbooks. And, more often than not, those of us who earn the least are exploited the most.
And none of us are exempt. In the recent period, particularly under the present Washington administration, more and more of us are feeling the financial squeeze. For the first time in generations, the sons and daughters of middle-aged Americans will not enjoy a standard of living equal to that of their parents.
We should fight not only for decent benefits and incomes, but also for a marketplace in which we’re not further victimized.
Given the toxic financial environment, it’s crucial that 1199ers and other working people become aware of the financial pitfalls that surround us. We should fight not only for decent benefits and incomes, but also for a marketplace in which we’re not further victimized.
This issue of Our Life And Times explores the pitfalls of financial naiveté. For some of us, it begins with our paycheck. One of the fastest growing industries in our nation is the payday loan business that traps workers in a cycle of borrowing on their paychecks.
Related to that is the rent-to-own ruse in which the consumer pays rental fees that add up to as much as three times the cost of the goods and often loses both the goods and her money by missing just one payment.
The insurance industry often provides more headaches and exploitation than it does security and peace of mind. Who hasn’t dealt with a company that harasses you for premium payments yet refuses to pay your claims?
This issue profiles several 1199ers stuck with burdensome student debts. New York State Attorney General Andrew Cuomo has blown the cover of college financial officers who have steered students to companies that did not provide the best terms but did provide the officers with kickbacks.
No unsavory financial practice will have greater repercussions than the subprime mortgage scam. A steep rise in the rate of subprime mortgage foreclosures has forced more than two dozen subprime mortgage lenders to fail or file for bankruptcy in the past year. Worse, thousands of families are losing their homes and savings. CNN reports that 20% of subprime mortgages issued in 2005 and 2006 will end up in foreclosure.
Today, it is virtually impossible to live without credit cards and at least some debt. The average U.S. family owes $9,300 in credit card debt. Many can barely keep up with monthly minimums, and, thus, are unlikely ever to pay off the principle.
If it seems to you that each day it becomes more difficult to make ends meet, you’re not alone. This issue highlights members with financial problems and others who have found their way out.
It’s important to fight for policies to help level the playing field, but it’s equally important for each individual to gain the knowledge that can prevent them from falling prey to the profit-mongers and to get on the road to financial literacy and health.
