Those are enormous numbers, and are resulting in a big impact on the economy, and a big impact on the lives of students and parents. Students now start their lives immediately deep in debt, forced to indefinitely delay purchases, including buying a car or home. They are even delaying marriage, and starting families. More adult children are living with their parents for a much longer time. The burden is on parents, too, who may have cosigned a student loan, or who are still supporting their adult children.

And it’s not affecting only those students in college for the first time. Workers trying to get retraining, or professionals looking to add a degree to make themselves more employable are also borrowing for their education and additional training. For-profit schools utilize the most student loans, and have the highest loan default rate.

Why has student debt risen so dramatically?

Students are borrowing more, 63% more, than only a decade ago. The percentage of student loan borrowers more than nine months behind on payments rose from 6.7 percent in 2007 to 8.8 percent in 2009, and continues to increase.

College tuition costs have risen faster than the rate of inflation—between 25% and 37% or even more for some institutions. Tuition has increased because federal and state subsidies to colleges have been greatly reduced; and administration, property maintenance, technology, and security costs have increased.

Student loan debt is structured differently than consumer debt, and cannot be discharged during bankruptcy. In 1998 federal students loans were restricted from inclusion in bankruptcy discharges, and in 2005 private student loans were also restricted. Unlike all other debt, for student loans, once it’s borrowed, it’s owed for life.

The increasing burden of student debt, combined with other debt, impairment of income, dissolution of savings, and unstable and difficult job market, combines like a perfect storm to keep the economy from recovering.

Let’s face it, personal data is more and more easily accessible. With that wealth of information, many new data providers have jumped into an eager market.

And not just for criminal or sex offender background checks; credit checks are increasingly being requested for job applicants and for rental applicants.

What can you do about it?

First be aware:

Not all data providers are reliable or accountable. Many of these companies have started, and conduct themselves, with no government oversight. They buy data, from a wide variety of sources, without being concerned if the collection is legal, accurate, or even for the correct person.

Sometimes the information itself may be flawed. Names can be confused—a person with a similar name and a criminal record can leave you without that job offer.  A misplaced digit in your Social Security Number can lead to incorrect information. A settled dispute regarding a debt may not have been cleared off your credit history. Past minor offences can suddenly show up categorized as major crimes, or sealed records suddenly are unsealed. Arrests that did not result in convictions may also show up on criminal background checks.

Know your rights:

Make sure you know what is legal. More and more cities and states are looking at regulating this issue. In San Francisco, for example, employers may no longer use the results of background and credit checks as the sole reason for not hiring an applicant.

In Hawaii, employers may ask about and consider criminal convictions less than ten years old that are rationally related to the duties and responsibilities of the job (banking, for example). Employers must first make a conditional offer of employment before running the background check.  The conditional job offer may be withdrawn if the applicant has a conviction record rationally related to the job. Contact the Hawaii Civil Rights Commission for more information.

You must give written permission to allow another person, even a potential employer, to request your credit report. If you are denied employment as a direct result of your credit report, the potential employer must give you a copy of the report and let you know you have the right to challenge it. More information from the Small Business Administration here.

If you have declared bankruptcy, it will show up on your credit report. However, Federal law prohibits employers from using that as a reason for not hiring.

Take action:

Review your credit report at least annually (it’s free!), especially if you are about to need it for a job or rental application. Take action to correct any mistakes.

If you are denied employment or housing, ask to see the supporting information collected about you. Check for errors, and make sure your potential employer or landlord knows the truth.

Remember that errors are common, and more and more companies are requesting background checks of one kind or another. It’s up to you to protect your rights, and make sure information reported about you is correct.

How to Protect Yourself

Make sure you know what fees, if any, are involved.

Is it cheaper to have funds direct deposited onto the card? Is there a fee for a customer service call? Or a fee for paper documents or to check your balance? Is there a monthly service fee, and how can you avoid that? Compare set-up or activation fees. Be sure to review and know your card’s fee structure, and account for those fees when thinking about your card’s available balance.

Where to go if you have a problem? Frequently there may be a fee to call customer service. Can you talk to someone in person to avoid that fee? Or where would you send a letter?

Know what ATMs you can use without incurring a fee.

Your pre-paid debit card will not necessarily establish your good credit, although credit bureaus are looking at adding that information in the future.

Remember that a pre-paid debit card is essentially the same as cash, and can be stolen. Take care of it as you would actual cash or a credit card.

Use a strong password and keep it safe. When you key it in, be aware of your surroundings and shield the keypad.

Track your debit card spending. This will keep you within your budget, help you avoid unnecessary fees, and let you anticipate expenses.

Be cautious if your pre-paid debit card automatically draws from your savings account—you don’t want to unknowingly start draining your savings! With PayDayHawaii’s pre-paid debit cards, you are eligible for a NetSpend Savings Account: No minimum deposit, and it pays 5.00% interest (Annual Percentage Yield)—one of the highest interest rates in the country. Load your card with funds from your savings account, or use it to deposit funds. And it’s FDIC insured.

For help in understanding the ins-and-outs of pre-paid debit cards, what card programs offered at PayDayHawaii, and how pre-paid debit cards could fit into your life, visit us here, call 808-822-5115, or visit one of our handy locations.

What’s the truth about pre-paid debit cards? How can you use them wisely and take steps to protect yourself?

First, understand the difference between a bank debit card and a pre-paid debit card—they are not the same. A debit card from your bank is used as a “draw” on your checking or savings accounts; is limited in funds only by the amount you have in your accounts at the time; and is subject to regular bank fees, including checking account, overdraft and ATM fees. A pre-paid debit card is not attached to a bank—you do not need to have a checking account to get and use one; there may or may not be small fees to set one up and use it; it can be loaded with whatever amount you choose. Neither bank debit cards nor pre-paid debit cards are subject to financial information oversight as credit cards are, so it is up to you to make sure you understand what you are getting, and to protect yourself and your money.

What Are the Advantages of a Pre-Paid Debit Card?

You don’t have to qualify for it as you would for a credit card, but you can use it in most places you would use a credit card, even internationally.

You don’t need a bank account to get one.

No monthly bills or late charges!

It’s safer to carry than cash.

And you can still use it to withdraw cash from the card if necessary.

You can use it to shop on the internet without needing a credit card.

It can be easily reloaded with funds, via the internet, phone, or ATM.

You can use it as a savings account, even keeping funds on different cards for different purposes. You can also give it as a gift (a good choice to give a student for school expenses).

You can also use it as a way to budget and to control your spending: There’s a definite limit on what you can spend, and you can’t rack up debt, unlike a credit card.

Pre-paid debit card fees are generally lower in total than those fees imposed by banks on checking accounts with their accompanying debit and ATM cards.

As part of our financial services packages, we do offer pre-paid debit cards at PayDayHawaii.

With your pre-paid debit card, you are eligible for a NetSpend Savings Account: No minimum deposit, and it pays 5.00% interest (Annual Percentage Yield)—one of the highest interest rates in the country. Load your card with funds from your savings account, or use it to deposit funds. And it’s FDIC insured.

For more information visit us here, call 808-822-5115, or stop by one of our handy locations

In Hawaii, our “ohana” culture encourages the reliance on our family and friends for support, which often includes financial assistance. Our tendency to mistrust large, faceless institutions is almost warranted, considering the state of the financial crisis, the new fees banks are charging and the Occupy Wall Street movement. Those reluctant to depend on nationwide banks seem more reasonable than ever before.

However, relying solely on family and friends can be disadvantageous, as well as sometimes impossible, in certain situations. When you are unable to pay this month’s rent, pride and other factors can lead us to look beyond the help of our loved ones. A Micro-Credit Advance is there for situations such as these. Large banks often require an intensive credit history check or steady employment. For people who lack collateral and may not have a stable source of income, a Micro-Credit Advance extends small loans perfect for these unexpected situations.

Unlike large banks, local institutions such as PayDayHawaii act as smaller, more intimate establishments reminiscent of your family and friends. Established in 1999, PayDayHawaii is locally owned and operated and is only available to Hawaii residents. It began in Kauai and currently has ten offices all over Hawaii. At PayDayHawaii, you can get a small loan if you are laid off or do not have enough funds for the chaotic and extremely costly holiday season. If you have a family emergency, you may not have enough to cover medical costs. If your rent is unexpectedly raised for whatever reason, your monthly income may not be sufficient. Or when the new school year starts for new clothes and school supplies. Life throws us all sorts of obstacles, and it may be inevitable that we cannot afford to pay the price.

PayDayHawaii offers Micro-Credit Advances that fit every situation. Once you receive your next pay check, you can work towards paying off your loan. For Micro-Credit 3, 11% of the repayment amount is charged for the loan, which will be due on any payday up to 3 days, ideal for over the weekend. For Micro-Credit 7, 13% of the repayment amount is charged for the loan, which will be due on any payday up to 7 days. For Micro-Credit 16, 15% of the repayment amount is charged for the loan, which will be due on any payday up to 16 days. For Micro-Credit Social Security, 11-15% of the repayment amount is charged for the loan, which will be due on your benefit payment date but no later than 31 days.

The size and density of our islands foster a culture of interdependence and close-knit ties. The aloha spirit and treating each other as ohana are just two things that make Hawaii such a unique place. It makes perfect sense that we go straight to the people we trust for favors. However, since our pool of resources is likely to run dry, especially in today’s economy, it is reassuring to know that Micro-Credit Advance can serve as a suitable substitute.

Banks, too, were hit hard by the financial crisis, and especially by new regulations (aimed at NOT having another crisis). Now that many of their previously profitable enterprises have been restricted, the banks’ new business model is to replace that lost revenue by creating additional fees, ranging from $4 to $40, for as many services as possible.

How can you minimize these extra fees?

First, carefully examine all communication from your bank, and read the fine print. Pay attention to see if they are instituting any new fees, and see if you need to change your accounts (keeping a minimum balance, not using actual bank tellers, or banking online, for example).

Don’t overdraw your checking account: those fees have increased, and can very quickly add up to a serious amount.

Only use your ATM card at your own bank’s ATMs: Most banks charge a fee for using another bank’s ATM, even if it’s part of the same “network.”

Don’t make a late payment to your credit card account. Again, those fees have greatly increased, and are very profitable to the banks and credit card companies.

If you’ve made just one late payment, or can’t get out of a new additional fee, talk to your bank. They don’t advertise it, but frequently you can get them to waive a fee one time, especially if you’ve been a reliable customer.

It’s not necessarily true that you’ll get a better deal if you combine all services at the same bank. It DOES pay to shop around and even divide up the services you need.

Reconsider what services you really need from a bank, or if you need a bank at all. Don’t pay for services you are not using! If you only write one or two checks a month, do you really need a checking account? PayDayHawaii offers Billpay, check cashing, money orders and money transfers, and prepaid debit cards, all perfectly suited for everyday life.

For full banking services, price-shop at smaller local banks and at credit unions; both will likely offer better deals and lower fees.

In today’s world, “buyer beware” is truer than ever. Don’t assume, and always ask questions. You worked hard for your money—don’t waste it on bank fees!

Don’t make it easy for someone to steal your identity and credit information! Here are some steps everyone should follow:

Guard your personal information:

Don’t share your Social Security number unless you absolutely have to, and don’t carry your card in your wallet.

Don’t share your birth date, your home phone number, or mother’s maiden name.

Put as little information on your checks as possible–definitely not your Social Security number or Driver’s License number, and not your home phone number.

Shred, shred, shred, shred!

Thieves search through trash to find statements you’ve thrown away, credit card offers, and other information they can use to recreate your identity. Don’t ever discard something with your personal information, passwords, account numbers, or enrollment forms. Shred!

In your wallet:

Sign your credit cards and bank cards—you can even write “Check Photo ID” in that space as well, if you want to be extra careful.

Make a copy of all your identification (everything in your wallet), with notification phone numbers, and keep in a safe place. Be sure to keep this updated.

Out in public:

Be aware of your surroundings when entering your pin number in public places—don’t let someone look over your shoulder.

Try to pay cash in coffee shops with a lot of laptop users—they can lift your card information.

Don’t shop online or enter secure information on a public WiFi system.

Have your mail collected by a neighbor or put on hold if you will be away.

Don’t leave bills or other revealing mail in your home mailbox for pick up—mail at the Post Office or at a Post Office box.

Online:

Create a strong password system, and don’t use the same password on all sites you frequent. Don’t use easily accessible information for your password: your pet’s name, your birthday, etc; and mix up your password with numbers and capital letters.

Don’t include your personal data (full name, birth date, phone number, address) on Facebook or other social networks.

Don’t expose your location/time/place in real time online (Facebook, FourSquare).

Keep on top of your online privacy settings.

Keep your antivirus settings up to date.

If you make purchases online, buy only on a secure encrypted website—look for the small padlock at the bottom or top of the screen.

Monitor your account activities online—this makes it easy to see if there’s any unauthorized activity. Check over your statements each month.

And finally…

Review your credit reports at least once a year. You’ll be able to check for mistakes, and to see if a thief has taken credit out in your name.

You are entitled by law to a yearly free copy of your credit report from each of the major agencies—do it!

Equifax: 1-800-525-6285
Experian (formerly TRW): 1-888-397-3742
Trans Union: 1-800-680-7289
Social Security Administration (fraud line): 1-800-269-0271

Make it easier on yourself by getting started on your tax prep now and getting yourself a little organized. It will take less time with your tax accountant, and might end up saving you money.

• Gather your W-2 forms and, if you have investments or interest-bearing bank accounts, pay a mortgage, or have done consultant work, your 1099 statements. If you were on unemployment or receive social security, you will receive a 1099. Do check them over—mistakes can happen! Bring your last paycheck stub of 2011, too.
• If you have bank accounts, gather together those statements, and any investment account statements.
• Have your social security cards for each member of your family, including any new family additions.
• Bring your photo ID (driver’s license, etc.).
• Be sure to bring your 2010 tax returns, even if you are using the same tax preparer.
• If you had any major family changes, bring documents relating to those (divorce, adoption, death, marriage). If you declared bankruptcy, bring your debt discharge statement.
• Do you have any work-related expenses? Hopefully you saved those receipts—bring them with you. Did you buy a uniform for a job, use your home computer for work, or buy tools for work? Did you have to travel for work, to a customer or to a meeting? List those (and the distance you traveled).
• If you have a home office or workspace, calculate the square feet and the percentage it is of your total house. Collect your utility bills, too—your office would have used some of those utilities. And don’t forget receipts for office supplies.
• You’ll need your automobile registration amount.
• Medical: The amount of medical bills you must exceed to make a tax deduction is fairly large; however it’s worth gathering together receipts for what you have spent and asking your tax preparer. Don’t forget prescriptions, chiropractic treatments, dental treatments, and insurance co-pays.
• If you purchase your own health insurance, discuss with your tax preparer whether it’s deductible.
• Do you pay child care, tuition, have a student loan, or receive financial aid for education? Bring all those documents to your tax preparer.

A little organization upfront makes the entire tax process more bearable, and you want to take all the deductions you are eligible for!

And don’t forget, PayDayHawaii offers tax preparation services. We’re an authorized E-file agent with over eight years of experience. Because we’re open year around, our fees are always less than the tax preparation specialists, and we can make sure you get your tax refund fast.