The power of V.I.T.A. and financial counseling

Client A.V. came to our offices to find assistance managing his finances along with assistance finding a second part time job to increase his monthly income.  A.V. also came to us with a $4000+ debt to the government. As a result his checks were even further reduced by an administrative wage garnishment.  Money is continuously tight for the A.V. household!  In discussing his finances we determined that he had made some mistakes on his tax filings.  By paying attention to his situation and listening for the clients response we began asking further questions.  Some question that came about were if he had been using the earned income tax credit and claiming his daughter on his taxes.  We found that he had been missing valuable credits which would have greatly increased his refund.  We filed corrections for his taxes and as a result he was entitled to much larger returns for the past three years.  Because of the garnishment these refunds were used by the government to pay this debt, however, now his liability has been greatly reduced by over $3000! Soon this balance can be paid and this garnishment will end, increasing the amount in his budget.  We are happy that we were able to have such an impact on the life of a client!

September Success Stories

Kim K., came to us as a referral from a good friend after recently being terminated from her most recent employer. Through the center’s services she received assistance applying for unemployment, but unfortunately was quickly denied.  Soon after her main focus was finding employment but she was not sure of where to start. She was also injured on her previous job which posed an issue for her to return to the field shed known for so long. Kim’s experience prior to program entry was in the healthcare industry but she also held a Class E driver’s license, but never truly took advance of it. For years she never needed a resume or had to apply online for jobs. So today’s job was an unexpected hurdle. However, with the assistance of employment services, resume building, job leads and access to the computers to conduct her job search. Soon after her membership she was gainfully employment full time as a local transportation driver with benefits. Kim’s success was due to her commitment to make scheduled appointments and her openness to overcome her hurdles.

Employers and Credit Checks

It is become a major topic of conversation on many job search and career sites.  People are talking about it with their friends and family members. I'm referring to the growing trend of employers using credit reports as a way of finding the "best" employees to fit their firms.  What this means and how it actually affects individuals is often poorly understood!

Who's checking and why?
Traditionally employers in very sensitive and high profile industries.  These have included the finance industry, defense firms, chemical and pharmaceutical companies.  However increasingly more firms in less sensitive industries are picking up this trend as a way of whittling through long lists of candidates.
Reviewing of credit reports are being used as an indicator of an applicants financial honesty and personal integrity.  Unfortunately, a credit report isn't always a great indicator of either, especially if negative credit items are the result of being unemployed!

Consumer protection
In all cases, an employer must get your permission to check your credit report.  The report that employers do receive is modified in a way that shields some consumer information such as account numbers, year of birth and references to your spouse.  Additionally, if a negative decision is made based on information in your credit report, the employer must send information on how an individual can get a copy of their report.  Most importantly, an employer can not access your credit report without your permission.

What you need to do:
Understanding that the reviewing of credit reports is being used as a way to help shrink the pool of potential candidates and make hiring decisions more efficient, there are ways of addressing negative items and ensuring you aren't automatically placed in the "No" Pile.

• Get a copy of your credit report from AnnualCreditReport.com: By knowing what's on your report you can identify any negative items.
• Be proactive: If you think something on your report may be keeping you from getting a job, take steps to address it with employers
• Write a letter to a potential employer detailing the life situations that caused the negative credit report item:  Highlight any steps you took to rectify the situation. 
• If the item is current or fairly recent, develop a plan on how you will improve the credit report:  Contact creditors or collection agencies to set up payment plans or negotiate payments or settlements. If you can't make payments due to your current situation, e.g. unemployment or under employment, discuss steps you will take when you are able.
• Focus on steps you are taking to ensure that your future credit performance stays positive.
• Stay away from excuses and wording that may be perceived negatively: For example, saying that I simply forgot to make my payments could show a lack of attention to detail.
• Remain positive: Talk about the changes you will make going forward and how you won't let money problems distract you from your work life.

Debt Collections: A huge problem for many Americans

Study: 35 percent in US facing debt collectors: Associated Press

In the above article, its reported that more than 1/3 of all Americans are being confronted by debt collections. Not only are they having to deal with the collection calls and other practices, for many who find themselves with accounts in collection, they also find themselves with a reduction in their credit score, difficulty finding housing and employment and the potential to be required to pay high deposits for services.  In many cases, accounts falling in to collection are the result of rising costs of services, increased costs of goods, which may divert funding away from bills to other necessities, and even extreme weather conditions can make paying utility bills more difficult.  With the stagnant wage growth in America, and the rising costs of living in many cities there are several important things the the Prosperity Center staff encourages. 
We work diligently to ensure that our clients can create a budget that helps them to get their finances on track.  We also help clients work towards keeping to their budget.  Our employment coach works with clients to help them find employment that pays a liveable wage.  She also works to help clients who are employed find ways to help them find ways to increase their salary through negotiation skills advanced training and/or certifications.
In addition to this, what's needed are some policy changes.  It isn't fair to the credit profile of many Americans to spend years paying their utility bills on time and to never have that information reported (Utility bills, including cell phones and cable services, are not reported monthly on your credit report).  The only time these accounts will report is when the account falls behind and goes in to collections.  One opportunity for policy improvements involves reporting the "full file" about clients.  This way in addition to the negative impact of a collection, clients will also have an account that shows the years of on time payments, allowing viewers of the report to see how well individuals pay their obligations and helping individuals to better showcase their good payment history.

March Success Story

 

 

Reginio H., came to us after being long term unemployed and having no income for a little over six years.  Mr. Hernandez has tried other employment services in the community, but unfortunately he was still unable to find employment. Within a nine year time frame his prior work experience was in a wide range of industries and no position was the same. Upon program entry, he received intensive one-on-one coaching sessions to determine his transferable skills in order to make him marketable for employment. His sessions also included: a mock interview, resume and cover letter revisions, employment referrals and job search options. Within a few months of his participation and determination he was able to find part time employment with the possibility of full time.  As a result, he received support services offered from the Center to assist with transportation for the first month. Not only has Mr. Hernandez increased his income he will also receive paid training from his new employer.