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What to Do if You’re Trapped in a Bad Auto Loan

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Sometimes, you don’t realize you sign a bad deal until you start having to pay for it.

Imagine this scenario: When you walked away from the auto dealer’s lot, you were excited. You had a brand spanking new — or new to you — vehicle. After the hassle of saving for, finding, and finally purchasing your dream car, your financing terms were likely the last thing on your mind. When the dealer sat you down and told you what your monthly payment would be, you did some mental math, figured you could afford the bill, and signed the dotted line. A few months later, you notice your loan could have been less expensive and feel cheated.

What do you do?

“If it’s in the contract and you signed the contract that’s it. You’re stuck with that,” said Anthony Giorgianni, associate editor at Consumer Reports.

If you’re not sure about your financing deal, a good way to evaluate it is by taking a look at the amortization table in the contract you signed, said Jerry Buchko, a Minneapolis-based debt counselor. If you can’t locate the original contract, you can ask for one via email or look for one online and estimate, but it’s most ideal to get it from the lender, and they should have a copy, said Buchko.

The amortization table is a set of tables that shows the total cost of your financing deal assuming all of your payments are made on time.

With the table in front of you, it becomes much easier to see if you’re currently paying more than what your vehicle is worth and if you’ll be in danger of being upside down on the loan (paying more than the vehicle is worth) in the future.

“With that information you should have all you need,” said Buchko. When analyzing and comparing the amortization tables for each loan offer, look for the one offering you the greatest overall savings, he recommended. Take a look at the interest rate you’re currently paying and the length of your loan, and see if you can make any adjustments to your lifestyle in order to save money.

For example, if the interest rate you’re paying isn’t very high, but your financing term is long and you see you’ll hit the ‘underwater’ point before your auto loan is completely paid off, you may want to consider increasing your monthly payments to pay off the loan faster (and get a chance to make money on a trade-in or sale before you can’t anymore).

While you’re looking at the contract, look at everything else it says, like the line items that were financed and any caveats in the terms, like a prepayment penalty that would penalize you for paying off the loan faster, as suggested above. You may also find there are elements of the loan agreement you didn’t really agree to.

“Sometimes the loans are packed with unnecessary things that are really expensive,” said Giorgianni. “If you feel you were misled, then go to the dealer and complain, and to a state agency if they don’t help.”

If you think you were duped into taking on more financing or given an unfair interest rate at the dealership, file a complaint with agencies like the Consumer Financial Protection Bureau, the Federal Trade Commision or the Better Business Bureau. The CFPB and FTC are also two good resources for consumer information on auto financing.

4 options to explore if your auto loan is too expensive

If you realize your auto loan  payments are too costly, the interest rate is too high, or the loan term is too long, you can try taking these steps to get out of a bad financing deal as well as better afford your auto debt.

Option #1: Try to refinance for a better deal

When you’re noticing your monthly auto payment may be too large to fit your household budget, you could try to lower your monthly payment somehow, by reducing your interest rate or lengthening your loan term. You can accomplish either by refinancing your auto loan at more favorable terms to get your payment under control.

If your credit score was lower at the time you financed your vehicle, then you may have been given less favorable loan terms. Understandably, you can’t always perfectly time a car purchase. If you desperately needed a vehicle to get around and didn’t have time to build your credit, your circumstances may have forced you into taking a bad deal. Now, if your credit score has improved or interest rates have gone down, you may have a better shot at reducing your interest rate.

“If it turns out that the main problem with the contract is that your rate is higher than it should have been, then a refinance is a good option but for a shorter or the same period,” said Giorgianni.

When you’re looking to refinance, compare loan offers with several different lenders, like your bank, a local credit union, and online loan search sites. Make sure to compare the final cost to you using the amortization table.

“Take a look at who is out there” said Buchko. “If you see another institution offering a lot better terms, contact them.” He recommends asking for the best loan arrangement you can get to pay off the loan when you contact a lender.

Extending a loan term to save money in the short run isn’t always the best savings strategy. But, if you need your vehicle and you are strapped for cash affording it, refinancing at a longer loan term may prove extremely beneficial. Giorgianni suggests borrowers avoid extending their loan terms unless it’s absolutely necessary — for example, if “you can’t afford the car and it will be repossessed.”

Whatever you do, be careful to make sure that the offer you ultimately decide to go with is as good or better than your current loan offer. If there are any fees associated, take care to factor those in as well as they could drive your monthly payment higher. Pay attention to the total cost you’ll pay and consider passing on the deal if it’s higher than what you’d pay in your current arrangement.

Buchko recommends asking yourself: “Am I meeting a goal of a smaller payment?” and, “Is the overall final cost of the loan going to be worth the smaller payment?”

Option #2 : Negotiate your terms with your current lender

Buchko said he often recommends trying to negotiate your current terms with the lender holding your loan. “Go to the lender you have been working with and see if there is anything they are willing to do to help you,” he said. “It’s much better to work out some sort of arrangement before you fall behind.”

You may be able to negotiate a lower interest rate or work out a deferment arrangement where you can skip making payments for a period of time, but they will be added to the end of your loan term and you’ll ultimately have a longer loan and pay more interest over time.

Buchko said speaking with your current lender works because the lender that you’re working with already has a vested interest in keeping you as a customer. However, he added, “a lot of it is up to the lender and how flexible they are willing to be to the customer.”

If your loan is still with the dealership, you may be out of luck if you want to negotiate better terms.

“Generally speaking, the dealer is probably not going to be interested in dealing with you,” said Jack Gillis, director of public affairs at the Consumer Federation of America and author of “The Car Book.”

If some time has passed since you made the purchase, the dealer probably doesn’t hold the loan anymore, Gillis pointed out. Your loan has probably been transferred to another company, anyway. You could call that company and ask for a refinance, and they may or may not respond with another offer.

Option #3: Cut back on other spending in your budget

An oldie but goodie. It’s always a good idea to refine your budget if you’re having a tough time covering your bills. If your car payment is difficult to manage, and you aren’t able to refinance your loan for a lower monthly payment, you should take a look at your budget to see if there you can find a way to get the car loan under control.

First, calculate your monthly income. That’s what you’re working with each month. Next, subtract your fixed expenses. Those are fairly non-negotiable items in your budget that aren’t likely to shift much like your rent or mortgage payment, auto loan payment, food, and any insurance you’re responsible for paying.

According to the 50/20/30 budgeting rule of thumb, your fixed expenses should comprise no more than 50 percent of your total income. If they are higher, see where you can save money. You could dial back spending on food, for example, by cooking more of your meals at home or switching grocery stores.

Next, your savings. Subtract what you intend to save for the month. Under the 50/20/30 rule, about 20 percent of your income that goes toward saving for things like retirement and vacations, or funding an emergency fund.

What you’re left with is money you can use on flexible expenses like dining out and entertainment. It should be about 30 percent of your income if you’re able to follow the 50/20/30 rule. Your flexible expenses should be where you should look to make the most adjustments because you may have more room to cut back. You may find extra money by cutting back on how much money you spend on coffee each week, or reducing the number of shopping trips you take each month.

Option #4: Sell your vehicle

Selling your car can be a tough decision to make for a myriad of reasons. Your vehicle may hold sentimental value to you, for instance, or it may be the only method of transportation for you and your family.

“Unfortunately, most people don’t want [sell the vehicle] but it’s better than getting the car repossessed,” said Giorgianni.

If your current financing deal is too much for you to handle, or if you realize keeping the car will eventually lead you to holding an upside-down loan, selling it may be your best option.

“If you are in trouble, then your only option really is to sell the vehicle and keep your fingers crossed that you are not upside-down so that you can use the proceeds from the sale to pay off the vehicle,” said Gillis.

If you plan to sell, sell as soon as you can. The longer you own your vehicle, the longer it has to depreciate (lose monetary value).

“If the car is fairly new, there is still value in the car,” said Buchko. If the vehicle still holds some value, and it’s more than what you owe, you can try to trade it in and use whatever value it still holds to purchase a new car, under more favorable financing terms for your

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Brittney Laryea
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Brittney Laryea is a writer at MagnifyMoney. You can email Brittney at brittney@magnifymoney.com

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Best Places for Women Entrepreneurs

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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Source: iStock

While women have been making strides in the world of business leadership in the past decade, American companies are still far from progressive and equal in this regard. Of incorporated businesses across the top 50 metropolitan areas in the U.S., just 30% are led by women, according to a new study by MagnifyMoney.

But where are women entrepreneurs seeing the most success? We surveyed the 50 largest U.S. cities to find the best places for women who want to be their own boss, launch a business — or both.

To create our rankings, we looked at data about women entrepreneurs across four different categories. The first two related to raw income and were double weighted in our analysis, while the last two related to the number of women entrepreneurs and business owners in the metro area.

What we considered in our analysis:

Business income for self-employed women. We ranked cities on both median and mean business income of self-employed women. By including both metrics, the rankings “capture both the more common experience of self-employed women as well as monetary success overall,” said Kali McFadden, senior research analyst at MagnifyMoney.

Ideally, both numbers would be in the higher end. A wide range between the two, however, could indicate a broader range of potential earnings for self-employed women in that area.

Business earnings for self-employed women compared with wage earners. We also ranked metro areas on the difference in earnings between self-employed women and those working for wages (both median and mean).

In general, self-employed women do earn less median and average incomes than people with earned income. “But a smaller gap between each group’s income implies better a potential upside for those going into business for themselves,” McFadden said.

The rate of self-employed and “incorporated” women. The rankings considered the percentage of employed women who work for themselves. “A higher rate of self-employment suggests that the city’s opportunities and ease of entry into business are better for women,” said McFadden.

Additionally, we looked at how many of those self-employed women have an incorporated business. “A higher number means that more women are seeing enough success and permanence to think about the legal and tax implications” of the businesses they own, McFadden pointed out.

Parity of business ownership between women and men. We looked at the percentage of total self-employed workers and incorporated business owners who are women.

Cities with higher percentages of self-employed women and women business owners could indicate a more even playing field, “where women are seeing the opportunities and conditions to break out on their own,” McFadden said.

Key findings:

  • San Francisco is the best metro for women entrepreneurs by a wide margin. Austin, Texas came in the second spot, and San Jose (Silicon Valley) was third. Cleveland, Pittsburgh, and Philadelphia came in last for women entrepreneurs.
  • Women entrepreneurs are set up for success on the West Coast. Five out of the top 10 metros are in California, with another in Washington. Tennessee is also hospitable to women entrepreneurs, with two metros in the Volunteer State landing on our list at the 4th and 5th spots.
  • There is a long way to go before we reach entrepreneurial parity — meaning an equal number of women and men starting and heading up young businesses. The average percentage of self-employed people on our list of metros who are women is a scant 37%, and the number is even lower among people with incorporated businesses: 30%.
  • Most self-employed women are not getting by on their business income. The highest median income we uncovered for women-led businesses is just over $10,000 and the lowest is zero. And across the 50 metros we reviewed, median business incomes amount to just 10% of the local median wages for women. “This is not surprising,” McFadden noted, “as self-employment could mean anything from having an Etsy store or offering a few hours of labor on TaskRabbit, to owning a bed-and-breakfast or gas station, to being a high-dollar commercial realtor or blockbuster novelist.”

The top 10 places for women entrepreneurs

In the best cities for women entrepreneurs, women who work for themselves are more likely to earn a decent living by doing so.

These cities also tend to have higher rates of women who are self-employed, a sign that the conditions could be favorable to workers ready to go at it alone.

Here’s a deeper look at the best U.S. cities for women entrepreneurs.

1. San Francisco

At No.1, San Francisco ranked at the top largely due to having the highest business incomes earned by women working there. The median business income is $10,378 among women in this city, and women’s average business income is $31,880.

In addition to their higher business incomes, women entrepreneurs are also more common in the San Francisco. Just over 10% of San Francisco’s women earners work for themselves. Looking at business owners, 41.7% of the city’s self-employed workers are women, and 32.1% of incorporated businesses are owned by women.

2. Austin, Texas

Women’s business earnings in Austin were on the higher end in terms of dollars, with the median at $8,262 and the average at $25,345.

But they’re among the highest when comparing women’s business income with the women’s earnings through wages. The average self-employed woman or business owner in Austin, for instance, makes nearly half (48.1%) what the average income for women in the city.

3. San Jose

A neighbor to San Francisco, San Jose is a similarly ideal place for women entrepreneurs. The city has one of the highest average business incomes for women, at $30,344 per year.

San Jose also has higher rates of women who are self-employed (41.1%) as well as incorporated businesses owned by women (32.2%).

4. Memphis, Tenn.

Memphis stands out for the higher median business incomes; most women entrepreneurs make around $9,068 in business income, second only to San Francisco. Plus, Memphis women have the highest business incomes when compared with local women’s earned income, earning about 25% of a typical woman’s wage in this city.

However, the average business income for women in Memphis is just twice as high as the median, “suggesting that the range of income isn’t that great,” McFadden said.

5. Nashville, Tenn.

Next is another Tennessee metro, Nashville, which is a standout when it comes to average business incomes for women. At $23,373, self-employed women in this city make just under half a typical women worker’s earned income. This is a sign that striking out on their own is a viable way for women to earn a decent living in Nashville.

That’s great news, given that Nashville has fewer women working for themselves and incorporating. Seven percent of women workers are self-employed, but just one in five of self-employed women have an incorporated business.

6. Los Angeles

Then there’s Los Angeles, which has the highest portion of self-employed women workers of any city on this list — 10.9%. Women entrepreneurs in LA can also expect a business income on the higher end, with the median at $7,758 and an average of $20,945.

7. San Diego

The next major California city to make the list is San Diego, which offers women a similarly attractive business landscape. Among women earning a business income in San Diego, the median is $8,060 and the average is $20,949 (both slightly higher than what LA’s women entrepreneurs bring in).

San Diego also has high rates of self-employment among women. One in 10 women workers in the city is self-employed, and 39.3% of self-employed workers are women.

8. Sacramento, Calif.

Sacramento lands at No. 8 by faring above average in most ranking factors, showing it’s a solid place for women entrepreneurs to take the leap into starting a business.

Take women’s business incomes as proof; the median at $7,053 and the average at $23,596 show Sacramento’s women entrepreneurs are able to outearn similar cohorts in other major U.S. cities.

9. Seattle

In Seattle, the average income for self-employed women is five times higher than the median — $22,713 to $4,534, respectively. “[This] suggests that while most self-employed women aren’t making much money, those who are are doing well are doing very well,” McFadden said.

Another factor backs up this insight: Among the top 10, Seattle has the highest rate (30.6%) of self-employed women who are incorporated. Plus, the city has high rates of parity in women business ownership: 42.1% of self-employed workers are women, as are nearly one-third of incorporated businesses owners.

10. Cincinnati

Rounding out the list of the best cities for women entrepreneurs is Cincinnati. Self-employed women earn decent business incomes in this Ohio city, with the median at $7,556 and an average of $21,432.

These earnings are high enough to compensate for lackluster rates of women working for themselves. Just 5.4% of Cincinnati’s women workers are self-employed, and these women account for 35.4% of all self-employed workers in the city.

In the 10 cities that ranked last on our list, self-employed women are earning far less than their counterparts in other cities. Take a look at the worst city, Cleveland, where women’s median business income is $0 — meaning at least half of self-employed women there don’t make anything at all.

The worst cities also have fewer women who have incorporated a business or taken the plunge into self-employment. This might make it harder for entrepreneurial women in these metro areas to find women mentors and women-centered entrepreneurial networks that can provide support vital to a new and developing business.

Placement at the bottom of this list could also signal that these cities are inhospitable to self-employed workers or new business owners in general — for both men and women alike.

That’s not to say it’s impossible for women entrepreneurs to start and build successful businesses in these cities.

Women living in these worst cities shouldn’t assume that their business endeavor will be doomed before it even begins. But they would be wise to practice extra caution in their plans to transition to self-employment or business ownership.

How women business owners can beat the odds

Living in one of the best cities won’t guarantee automatic success any more than a woman starting a business in one of the worst cities will fail. Wherever they live, women entrepreneurs must overcome obstacles and chart their own path to self-employment.

For women ready to take their first steps toward entrepreneurship, these steps can help them get further faster.

  • Start small but dream big. Even if you’re not ready to quit your job and hustle full time, don’t put your entrepreneurial goals on the back burner. Build out a timeline to get you closer to self-employment or starting a business, filled with small and actionable steps you can start taking now. A side hustle can be the perfect way to get a feel for being your own boss without giving up your main source of income.
  • Explore the business landscape of your specific city. Research local regulations and bylaws that could be pertinent to your business idea. For example, you can start checking out everything from business licensing laws to local small business tax breaks to help build out your business plan. You can also research local small businesses to see which are doing well and why, to get insights into how to set your own venture up for success.
  • Seek out local resources for women entrepreneurs. Many cities recognize the important role small businesses, startups and self-employed workers play in fueling local economies. And some have responded with support systems designed to foster growing businesses — and women entrepreneurs who lead them. One example is San Francisco-based Girls in Tech, a nonprofit founded by Adriana Gascoigne,which seeks to empower and educate women (including entrepreneurs) in the tech industry. Even the bottom-ranked city, Cleveland, has local organizations focused on supporting women entrepreneurs, such as women -focused business development courses from Aviatra Accelerators and an annual Female Entrepreneur Summit.
  • Network with other self-employed women. Don’t underestimate the power of meeting, working with and learning from like-minded, entrepreneurial women. The local organizations mentioned above can be the perfect way to connect with other women entrepreneurs in your area and find a new friend, mentor or even a future business partner. You can also look for co-working spaces, entrepreneurship-centered meetups or social events for local businesswomen to grow your network.

Methodology:

Each of the 50 largest metropolitan statistical areas (“MSAs”) was scaled against each other, so that the most positive result for each factor was 100 and the most negative was 0, on the following eight factors from the U.S. Census Bureau’s American Community Survey for 2016, either available through FactFinder or calculated from microdata housed in IPUMS USA. The results for each factor were then weighted according to the notation below, and the sum was divided by eight (rounded to one decimal point), for a highest possible score of 100 and a lowest possible score of 0.

  • Median business income for self-employed women (double weight)
  • Average business income for self-employed women (double weight)
  • Ratio of median business income to median earned income for the metro (double weight)
  • Ratio of average business income to average earned income for the metro (double weight)
  • Percentage of working women who are self-employed (single weight)
  • Percentage of self-employed women who are incorporated (single weight)
  • Percentage of self-employed people who are women (single weight)
  • Percentage of incorporated people who are women (single weight)

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

Elyssa Kirkham
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Elyssa Kirkham is a writer at MagnifyMoney. You can email Elyssa here

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The 5 Best Outdoor Renovations for Summer

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

203k loan

By Ellie Holt, Fast Copy News Service

If you want to host evening barbecues, patio brunches or an afternoon tea party, you need an outdoor living space fit for guests. Upgrading your porch, patio, deck or yard can be an investment that adds comfort and possibly increase your home’s value.

The updates could improve your mood, too. According to the National Association of Realtors (NAR) and National Association of Landscape Professionals (NALP) 2018 Remodeling Impact Report, homeowners’ happiness increases after an upgrade is done. A new wood deck, water feature, statement landscape and new patio all received “Joy Scores” of 9.7 out of 10, or higher, according to the survey of 4,079 people.

Here are five investments to amp up your outdoor space for summer entertaining.

New deck or patio

A new deck or patio is one of the largest investments that you can make in your outdoor space, to host family and friends not just during the summer, but also year-round.

According to the 2018 Remodeling Impact Report, landscape professionals estimate the average cost of a 18-feet x 16-feet concrete paver patio to be $7,200; NAR says $5,000, or 69% of the cost could be recovered when selling a home.

The average cost of a 14-feet deep x 18-feet wide wood deck attached to the house would be  be $10,000, with 80%, or $8,000, recovered when selling, according to NAR estimates.

Investing in a project to transform your outdoor space could help you see your home in a new light. In fact, 84% of those surveyed said they have a greater desire to be home since completing a patio project, and 81% said they have a greater desire to be home since completing a new deck.

Dramatic focal point

Creating a focal point, from a water feature to a fire pit, can be a game changer for an outdoor lifestyle.

Kirsten Coffen, a landscape architect and owner of Garden Architecture, based in Fork, Md., suggests that homeowners consider the maintenance you are willing to put into your outdoor space before you decide on your focal point.

Research shows that consumers are happier after completing a water feature project. The Remodeling Impact Report stated that 83% of those surveyed said they have a greater desire to be home since completing the project and 79% have an increased sense of enjoyment when they are at home. A water feature project had a “Joy Score” of 9.8 out of 10.

But fire features snagged a perfect 10 “Joy Score” from the NAR and NALP survey. The report found that spending $6,000 to add a fire pit with natural stone and a gas burner on a flagstone patio that is 10 feet in diameter resulted in $4,000, or 67%, in estimated recovered costs.

A more affordable option is a portable fire pit, which can cost less than $50, and Coffen suggests to make sure it has a lid to contain the ashes when it’s not being used.

Container gardening also can be a choice, said Coffen, a member of the American Society of Landscape Architects (ASLA). Adding a planter — which can cost less than $60 for a small, lightweight resin or about $150 for containers made of terra cotta or stone — or two can create a pleasing aesthetic.

Lighting

Lighting can do wonders for your outdoor living space, from highlighting a focal point to adding the perfect atmosphere to your space, Coffen said. For example, installing 20 LED lights and a standard 600-watt transformer costs $5,000 on average, according to the Remodeling Impact Report.

“It can also be quite lovely to uplight some of the specimen trees, or if there is a water feature or a pond or something to have some lighting in that,” Coffen said.

More than half, or 51%, of people install landscape lighting to add features and improve livability, according to the Remodeling Impact Report. You could recoup half the cost, NAR estimates.

Lighting along pathways can add just the right touch to a party or evening dinner.

“It can be as simple as stringing some lights in their trees or actually having lights installed outside,” said designer Alice Cramer, owner of Atlanta-based Alice Cramer Interiors.

Statement landscaping

Nature draws people outdoors, so presenting your landscape in an intentional way is a crucial component of outdoor entertaining.

A 2018 ASLA survey of landscape architects identified these project types with the most expected consumer demand: native plants (83.3%) and low-maintenance landscapes (80%). The placement of your natural focal point, such as planting trees, also can drastically change the outdoor ambience, Cramer said.

Coffen recommends planting a specimen tree or a shade tree by your patio. Consider how it filters the light to create shadow patterns.

“It’s like a piece of living architecture outside,” Coffen said.

According to the 2018 Remodeling Impact Report, 74% of real estate agents have suggested sellers complete a landscape maintenance program before attempting to sell their home.

Furniture

Furniture may be an obvious update, but it continues to be a go-to way to invest on the outdoors, with 64% of landscape architects surveyed by the ASLA agreeing it’s the most important outdoor design element.

“Nobody’s going to go out there if it’s not comfortable or pretty,” said Cramer. “If you’ve got some nice furniture sitting there, people are gonna want to go. It’s more appealing.”

But just like buying furniture for inside the home, don’t forget to measure the space outdoors, whether it’s a screened porch, patio or pool cabana.

“First of all, it is important that the space is big enough to accommodate the furniture that you want to put outside,” Coffen said.

If you don’t have room in your budget to replace your furniture, add an umbrella for an instant burst of color and style. Coffen suggests that you tie in the colors in your umbrella with pillows on your furniture or your flowers to create a common color scheme.

Patio umbrellas range from about $55 for a 9-foot ikat option from Walmart in chartreuse with the ability to tilt to block out the sun, to nearly $900 for a cantilevered, 11-foot option in colors such as kiwi from Frontgate.

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MoviePass vs. Sinemia vs. AMC Stubs A-List vs. Cinemark Movie Club — Which Theater Subscription Is Best?

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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This story was originally published on July 17, 2018. It was updated with new rules and changes to the theater subscriptions featured in the article.

MoviePass is facing stiff competition as several theater chains and startups have launched their own rival theater subscription services.

There’s AMC Entertainment’s AMC Stubs A-List, launched in June, Cinemark’s Movie Club, which hit the scene at the end of 2017 and Sinemia, a startup founded in 2014.

All three competitors seem in their own way to directly target the biggest consumer gripes about using MoviePass — the inability to book tickets in advance, see multiple films in one day and see the same flick more than once.

To its credit, MoviePass isn’t going down without a fight. It already made a dramatic pricing change, slashing its monthly fee from $39.99 at its highest to $9.95 per month, attracting millions of new subscribers in the process. The number of MoviePass subscribers reportedly surged from about 20,000 in early 2017 to 3 million as of June 2018. Earlier this year, it reportedly sued Sinemia for patent infringement. And it recently diversified its offerings with a lower-priced subscription plan.

Cash-strapped MoviePass announced in late July it would raise the monthly subscription to $14.95 but canceled the price hike plan just a week later. Instead, it’s now keeping the $9.95 plan but limiting each member to a three-movie allowance every month starting Aug.15, 2018. For each additional ticket, MoviePass subscribers can get a discount for up to $5. MoviePass members used to be able to see up to one movie per day with the same monthly subscription fee.

For consumers, competition is almost always a good thing. Companies are forced to make their services more appealing in hopes of attracting new customers.

In this post, we will go over the benefits and limits of the four monthly movie subscription packages to help you choose the one that best fits your needs.

MoviePass vs. AMC vs. Cinemark vs. Sinemia

Fees and fine print

AMC Stubs A-List



MoviePass



Sinemia



Cinemark Movie Club



COST


$19.95/month + tax

$7.95/month or $9.95/month depending on the plan

$3.99 to $14.99 per month for individual plans; $8.99 to $89.99 for family plans.

$8.99/mo

MOVIE LIMITS


See up to 3 movies per week

3 movies per month starting Aug.15, 2018.

See up to 1, 2 or 3 movies per month, depending on the plan.

1 movie per month

THEATER ACCESS


600+ AMC theatres

5,200+ theaters

4,000+ theaters

339 Cinemark theaters

CANCELLATION POLICY


You can’t cancel your subscription during the initial three months of membership. After the three-month commitment, you can cancel anytime and your benefits last until the end of the current billing period.

If you cancel your subscription, you won’t be able to re-enroll or start a new subscription for 9 months. Your account will be active until the last day of your current billing cycle.

You can cancel anytime but Sinemia won’t refund you the upfront annual fee. However, you’ll be able to use your membership until the last day of your plan.

You can cancel any time you want and won’t have to wait for a period of time to reactivate your membership after cancellation. Your benefits are effective until the last day of the current billing cycle.

FINE PRINT


May charge surcharge when movies are in high demand. (peak pricing is suspended for users who’ve migrated to the new plan)

The monthly fee is actually charged upfront for the entire year. If you prefer not to make a year-long commitment, you have to make a one-time monthly initiation payment of $19.99.

AMC’s fee may seem steep, but with MoviePass adjusting pricing beginning mid-August, AMC Stubs A-List will become the most cost-effective plan for the number of movies it offers every month (12). In addition, it offers more flexibility, such as advance ticket-booking, repeated visits to the same movie and seeing more than one movie on any given day.

Cinemark might look more appealing at $8.99/month, but you can only see one film per month and you’re limited to Cinemark theaters. By comparison, though there are many limitations with MoviePass, like the one-visit-per-movie rule, it’s still one of the better deals — $9.95 — for three movies a month. MoviePass currently has a lower price plan that charges $7.95 for three movies per month. It’s unclear what will happen to this plan after Aug. 15, however. MoviePass has said 85% of its members see three or fewer movies a month, but avid users may be disappointed by the change.

If you are not a frequent moviegoer, Sinemia’s classic plan — one 2D movie per month — is by far the least expensive plan, starting at $3.99/month. But read the fine print. The service charges its fees upfront, meaning you could be on the hook anywhere from to $47.88 to $179.88/year right off the bat, depending on which plan you choose. And if you cancel your subscription before the year is up, they won’t refund you the upfront fee. For those who don’t want to make a long commitment or want to have a test run with Sinemia, you have the option to pay a $19.99 one-off monthly initiation fee, in addition to your monthly plan payment.

Hidden costs

MoviePass recently introduced peak time pricing, meaning users will have to pay a surcharge fee — on top of their monthly subscription — for high-demand movies, depending on the specific title, date or time of day. In New York, for instance, the surcharge can be as high as $8. In order to avoid the additional cost, price-sensitive users will need to pick showtimes and locations accordingly. MoviePass said it would suspend the surcharge for members in the new plan starting August 15.

Variety of plans

AMC and Cinemark are simple with just single plan options. MoviePass has two plan options. Sinemia has the most complex offerings, with four different plans to choose from:

Classic (2D movies only)

  • $3.99 (1 movie per month)
  • $6.99 (2 movies per month)

Elite (all movie formats)

  • $9.99 (2 movies per month)
  • $14.99 (3 movies per month)

Available formats

AMC Stubs A-List


MoviePass


Sinemia


Cinemark Movie Club


All formats, including 2D, Dolby Cinema at AMC, IMAX and RealD 3D


2-D movies only


Varies by plan.


2-D movies only


If you want premium movie formats, go for AMC Stubs A-List or Sinemia’s Elite packages. MoviePass and Cinemark Movie Club members can only see 2-D movies. However, with Cinemark Movie Club, you have a choice to see premium movies, such as IMAX, with some additional fees.

Book tickets in advance?

AMC Stubs A-List



MoviePass



Sinemia



Cinemark Movie Club



Yes. You can make a reservation through the AMC website or mobile app.


No. You can only reserve a same-day ticket if the app indicates e-ticketing is available in a particular theater. Otherwise, you have to book in person. A physical card is needed for ticket purchasing in most cases unless the theater supports e-ticketing.


Yes. You can book your tickets online up to 30 days in advance through the app.

You can also order a physical card separately, which allows you to purchase tickets on the spot at the theater in a MoviePass fashion.


Yes. Tickets can be purchased via the Cinemark app, online, or at the box office.


MoviePass might require the most hassle to reserve a ticket. First, you need to sign up for a MoviePass account online or through its mobile app. Then you have to wait for a physical MoviePass card to arrive in the mail to activate your account. MoviePass users must physically show up at theaters to buy same-day tickets with the card (unless the theater supports e-ticketing, in which case you don’t need the card) and, they have to verify the purchase each time they use MoviePass by taking a photo of the ticket stub and submitting it through the app. You can follow our step-by-step guide to use MoviePass correctly and effectively to avoid unwanted frustration.

With other services, a membership card isn’t necessarily needed for purchase tickets. Members can make a reservation in advance through the services’ websites or mobile apps or at the theater box office.

Can multiple users share a subscription?

AMC Stubs A-List



MoviePass



Sinemia



Cinemark Movie Club



No


No


Yes


Yes*


Most of these services don’t let friends or family share subscriptions — the exception is Sinemia. It features a wide selection of family plans for two to six people, charging from $7.99/month (one movie day for two people) to $89.99/month (three movie days for six people).

*Cinemark allows Movie Club members to pay $8.99 for an additional ticket at checkout. Theoretically, it could be a $17.98 monthly subscription for two.

Other perks

AMC Stubs A-List




MoviePass



Sinemia



Cinemark Movie Club



-Members receive the AMC Stubs Premiere benefits for free (worth $15/year+tax).
-Members can earn AMC Stubs points on the monthly membership charge:100 points on per $1 spent.


You can refer up to three friends who, upon sign-up, will get their first month of MoviePass for free.


You can get $5 for referring each friend to Sinemia. Your friend also gets the same credit reward.


-Members can receive 20% off on concession purchases.
-New subscribers can get a free Android smartphone (as of July 10) if they pay $100 for 2 months of wireless services.
-Members can earn Cinemark Concessions points.


While it’s unclear which Android phone comes with a Cinemark Movie Club membership and an additional $100 for two months of wireless services, for those who need a smartphone, the deal just comes in time.

Which subscription service is best for me?

Who MoviePass is best for

If you are a flexible moviegoer who does not mind avoiding peak time to see movies and feel comfortable going through the multiple steps to purchasing tickets, MoviePass is a more cost-effective deal for you. In many parts of the country, such as New York, where a movie ticket easily costs more than $15, you could get your subscription value back by seeing just one movie each month. If you have a taste for indie, low-budget movies, or you simply don’t frequent AMC or Cinemark theaters, you should also stick with MoviePass.

Steer clear of MoviePass if you live in a densely populated area where movies may sell out quickly. You may find it difficult to get to the theater and reserve a seat the same day.

And keep in mind MoviePass will block you from reactivating your plan or signing up for a new subscription after cancellation.

Check participating MoviePass theaters here.

Who AMC Stubs A-List is best for

Mainstream movie viewers who prefer to lock in tickets in advance — especially tickets to premieres of big releases — or have a particular liking for premium movie formats, such as 3D, may want to pay extra for the better service terms with AMC. You could also get discounts on beverages or popcorn at the concession stand. Just make sure you live in reasonable distance of an AMC theater.

Check participating AMC theaters here.

Keep in mind AMC Stubs A-List requires a minimum three-month subscription from its members, during which they cannot cancel their membership.

Who Sinemia is best for

If you only go to the movie theater once or twice a month and are willing to commit to paying an entire year’s subscription upfront, consider Sinemia, whose multi-layer pricing structure could satisfy people with different entertainment needs. For families, couples and friends who would like to see movies together, a Sinemia’s family package could also be a worthwhile investment.

See participating Sinemia theaters here.

Keep in mind Sinemia, which charges members a lump-sum subscription fee once a year, won’t refund you if you cancel your membership. If you would rather pay by month, you have to pay a $19.99 one-off monthly initiation fee, in addition to your monthly plan payment.

Who Cinemark Movie Club is best for

If you are someone who lives in a place where a movie ticket costs more than $9 and you do not like to commit to seeing a certain number of movies each month. Cinemark Movie Club allows unused credits to be rolled over. If monthly credits are used up, subscribers can also buy two additional tickets per transaction for $8.99 each. Basically, it’s an indirect way to sell a movie ticket for $8.99 that comes with some conditions. And if you happen to need a smartphone, its current sign-up deal is a steal.

Is MoviePass here to stay?

The finances of MoviePass have recently been called into question. Industry experts have suspected that the company can’t stay afloat with its unprofitable business model. MoviePass buys full-price tickets from theaters and offers them to subscribers.

In May, the company’s majority owner, Helios and Matheson Analytics, reported more than $26 million in net profit losses during the first quarter of 2018.

Because it didn’t have enough money to pay for movie tickets, MoviePass experienced a service outage on July 26, when many customers couldn’t use their MoviePass cards to purchase tickets at theaters. The company had to borrow $5 million in cash the next day to pay its merchant and fulfillment processors. This was the incident that spurred the now-abandoned plan to increase the monthly charge, through which the company hoped to reduce the monthly burn by 60%.

Helios and Matheson Analytics’ stock traded at $0.09 per share on Aug. 6, a nearly 52-week low, down almost 100% from last October’s peak of $38.86.

While MoviePass projects its subscribers to surpass 5 million by August, some analysts have predicted in media interviews that the company has a high likelihood of bankruptcy.

If MoviePass eventually proves to be too good to be true, current users should enjoy the deal while it lasts. At least alternatives are now available.

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

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America’s Biggest Boomtowns

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

iStock

The story of the United States is the story of people migrating to different cities and towns to build new lives through new opportunities. From the promise of gold to the promise of big tech in Northern California; from trading furs to building cars in Detroit; from the prosperity of shipping to the prosperity of hospitality in Charleston, the country is built on boomtowns.

We wanted to find out where Americans are gathering now to take advantage of growing prosperity and improved lifestyles to achieve the American dream.

Key findings

  • Austin, Texas; Provo, Utah and Raleigh, N.C., top our list of America’s boomtowns.
  • Scranton, Pa.; Syracuse, N.Y. and New Haven, Conn., fall to the bottom.
  • Americans are flocking to and prospering in Texas.
    • Texas metros take up one-third of the top 15 spots.
  • Parts of the Mountain region are also booming, comprising four of the top 15.
    • Two of the three Utah metros we reviewed are in the top 15 (Provo in 2nd place and Ogden in 12th), with Salt Lake City not far behind in 18th.
    • Denver came in 6th, and Boise, Idaho came in 8th.
  • The Carolinas are also attracting workers and businesses, with Raleigh taking the 3rd spot, Charleston the 4th and Charlotte the 13th. Durham, Raleigh’s neighbor, is in 16th place.
  • On the other end of the spectrum are the Northeast and some neighboring states, including Ohio, where four of six metros in our study saw their labor forces and the number of businesses shrink, and only one saw appreciable growth (Columbus, Ohio).
  • Every metro in Connecticut and Pennsylvania falls in the bottom quarter of our list, as did every metro in New York except for New York City. In fact, the only Northeast city to fall in the top half of our list was Boston.

The elements of a boom

To find out which of America’s metros are booming, we looked at how much each metro has changed between 2011 and 2016 (the most recent year for which all data is available at the metro level) in three different categories, which we scored independently before combining the results to reach a metro’s final score.

Growing industry

The first thing we looked at was how much business and industry has grown locally. We not only wanted to know how many new businesses there are but also how businesses in general are doing, as measured by their increase in hiring and — for businesses that don’t have employees, known as non-employers — how much revenue has increased.

More people and housing

The most essential component to a boomtown is this: Are people coming, and is the metro growing to keep up? To figure that out, we used the Census Bureau’s American Community Survey (ACS) to measure changes in total population and the number of housing units.

Growing workforce and employment opportunities

People generally enter a local workforce because they seek better opportunities, so we wanted to see how that changed, along with improvements to the unemployment rate and the increase in earnings.

Why some of our results might surprise you

Some of the metros that have been declared among the “fastest growing” in the news may fall lower on our list on than one would expect. For example, Greenville, S.C., has been touted as one of the fastest growing cities in America, but we see a population growth of 5.5% over the five-year period. Nothing to sniff at, but it’s the 13th highest on our list rather than in the top five.

One reason is that we looked at the five-year growth period rather than one year. Another is that the Census changed the area of some metros, so additional counties were added between 2012 and 2013. To make sure we were actually talking about the exact same footprint, we used and compared the data for counties that are currently in each metropolitan statistical area.

The biggest boomtown in America

These are the metros that are seeing the biggest influx of people, work opportunities and business growth.

1. Austin, Texas

Final Score: 87.8

Austin jumps way out ahead of all the metros we reviewed, showing the greatest five-year growth in population and housing, earning a perfect Population & Housing score of 100. Even so, the increase in housing units of 10% isn’t keeping up with the population growth of almost 16% over a five-year period. Interestingly, almost all of those gains in population have gone directly to the local workforce, and that, combined with a 23% drop in unemployment and an almost 9% increase in median wages, gives Austin the highest Workforce & Earnings score (70.3) on our list. While the metro comes in second for Business Growth, it’s with an A score of 93, thanks to a 21% increase in the number of businesses and a 24% increase in the number of employees those firms hired.

2. Provo, Utah

Final Score: 75.7

Business is booming in Provo, with 20% more businesses in 2016 than in 2011 employing 30% more workers. This gives the metro the top Business Growth score of 95.1. It also ranks high in Population & Housing, coming in third with a score of 79.9 thanks to a population increase of 12% and a housing increase of 8%. The Workforce & Earnings score is a respectable 52.2 (8th highest on our list), thanks to 13% growth in the workforce, and an OK drop in unemployment compared with other metros, at 20% (32nd). But wages don’t seem to be keeping up, as the median earnings for workers is only 3.5% higher than it was five years earlier (63rd).

3. Raleigh, N.C.

Final Score: 67.7

The second biggest population and housing increases — 13% and 9%, respectively — give Raleigh the second highest Population & Housing score of 84.1. North Carolina’s capital ranks No. 5 in Business Growth with a score of 70.8, boasting a 13% increase in establishments and a 21% increase in paid employees. Raleigh earned the 10th highest Workforce & Earnings score (48.3), thanks to 12% increase in the civilian labor force, which offset the mediocre (relative to the other metros on our list) 18% drop in the unemployment rate and a median earnings growth of under 4%.

4. Charleston, S.C.

Final Score: 66.4

Nipping at Raleigh’s heels, the historical coastal city saw its population jump by 11% between 2011 and 2016. The increase in housing units hasn’t kept up, at just over 6%, giving Charleston the fifth-highest Population & Housing score (66.9). The Business Growth score is the fourth highest on our list, at 71.7, due to a 14% increase in business establishments and 17% increase in paid employees (the fifth and 18th highest gains on our list, respectively). Charleston shines even more in Workforce & Earnings category, with a score of 60.6, the third highest on our list. The healthy 22% drop in unemployment and an 11% increase in the workforce (closely matching the overall population increase) are matched by the seventh-highest median wage increase of over 9%.

5. Nashville, Tenn.

Final Score: 60.7

Business is good in Nashville, where firms grew their staff by 21% (fourth highest), numbers that seem to be in excess of the 10% increase in establishment (22nd highest). That earned Nashville a Business Growth score of 72.9, the third highest among the metros we reviewed. It follows that the metro, which has long been diversifying from its country music legacy, has the fifth highest Workforce & Earnings score of 54.6, thanks to a 9% increase in workforce (ninth highest), a 25% drop in unemployment (14th highest), and 7% increase in median earnings for workers (16th highest). An interesting note is that the increase in the workforce is actually greater than the overall increase in population of just under 9% (14th highest), suggesting that the boom may be luring people to work. Although at 5%, housing growth isn’t keeping up with the influx of people, it is the 13th biggest increase on our list and adds up to a Population & Housing score of 54.5.

The most sluggish places

Not every metro is growing, and some are even contracting. These are the five most sluggish of the metros we reviewed.

100. Scranton, Pa.

Final Score: 9.9

Believe it or not, Scranton’s 0.4 Population & Housing score wasn’t the lowest on our list (Toledo, Ohio earned a perfect 0.0), but it is the result of a population drop of 0.4% and a 0.1% increase in housing units. At 14.3, Scranton had the third lowest Business Growth score (Pittsburgh and Syracuse, N.Y. fare worse at 13.2 and 14.1 respectively), thanks to an incremental 0.6% increase in business establishments. However, businesses did slightly better in hiring 5.5% more employees, the 15th lowest on our list. One bright spot is the rise in median earnings for workers — at 8.4%, it was the 11th highest of all the metros we reviewed. Unfortunately, it wasn’t enough to counter the 1.4% drop in labor force that presumably followed the drop in population, or the slight increase in unemployment (the fifth and sixth smallest gains on our list). That adds up to a Workforce & Earnings score 15.1, the 12th lowest on our list.

99. Syracuse, N.Y.

Final Score: 10.8

Business isn’t great in this upstate college town; only one other metro (Pittsburgh) got a score lower than Syracuse’s Business Growth score of 14.1. The metro saw no change in the number of business establishments, and businesses only increased their staff by 4% (the eighth lowest on our list). The population stayed steady with a 0.1% increase and was slightly outpaced by new housing units (0.9%), earning the metro a Population & Housing score of 4.6, the 12th lowest on our list. A 0.4% decrease in workforce and a marginal decrease in the unemployment rate of 3.2% offset the metro’s respectable 5.9% gain in median earnings (33rd highest), leaving Syracuse with the eighth-lowest Workforce & Earnings score (13.6).

98. New Haven, Conn.

Final Score: 11.6

People aren’t moving to this Ivy League community, and the people there seem to be leaving the workforce. Unemployment was down almost 9%, which seems great, but 72 other metros on our list saw bigger improvements, and 66 other metros had their median earnings increase by more than the 3% New Haven did. Business establishments grew by almost 2% in New Haven in five years (80th out of 100), but they only took on 5% more workers (90th place). That general stasis earned New Haven a score of 3 for Population & Housing (10th lowest), 13.9 for Workforce & Earnings (ninth lowest) and 17.9 in Business Growth (ninth lowest).

97. Cleveland

Final Score: 13.1

People seem to be leaving metros in Ohio, and Cleveland is no exception, experiencing a population decrease of just under 1%. In fact, it was the biggest population loss of all metros we reviewed. There was a small increase of 0.2% in housing units (fourth lowest), which is why Cleveland’s Population & Housing score of 1.1 came in ahead of Toledo, Ohio and Scranton, Pa. The number of establishments actually went down by about 1% (second only to Toledo’s loss of 1.4%), and the remaining businesses only increased their staff by about 4% (the fifth lowest gain). Overall, Cleveland’s Business Growth score of 15.6 was the sixth lowest on our list. On a brighter note, Cleveland earned a Workforce & Earning score of 22.7 (71st out of 100), thanks to a substantial 17% reduction in unemployment (46th out of 100) and over 4% more in median earnings (52nd), but these results were dragged down by a workforce that shrank by 1.4%, the fourth biggest loss on our list.

96. Hartford, Conn.

Final Score: 13.3

The good news is that median earnings for workers in Hartford went up by 6.6%, the 23rd highest on our list. The drop in unemployment was almost 9%, which seems like a lot, but 74 metros on our list did better. That, combined with a barely perceptible 0.3% increase in the workforce gave Hartford a Workforce & Earnings score of 20.6, which ranks 76th out of 100. Unfortunately, it’s downhill from there, with 90th place in the Population & Housing score because of a population growth of 0.3% and a housing unit increase of 0.6%. Connecticut’s capital had the 5th lowest Business Growth score of 15.1, thanks mostly to a lackluster 7% increase in receipts by non-employer businesses (second lowest on our list).

Comparing the 100 biggest metros in the U.S.

Methodology

Limiting our research to the current 100 largest metropolitan statistical areas (“MSAs”), we tracked the five-year change between 2011 and 2016 (the last year for which all data was available) using data from the U.S. Census American Community Survey and County Business Patterns in the following categories:

Population & Housing:

  • Total population
  • Total housing units

Workforce & Earnings:

  • Total civilian labor force
  • Unemployment rate
  • Median earnings for workers (dollars)

Business Growth:

  • Number of establishments
  • Paid employees per pay period
  • Total receipts for non-employers

Because the U.S. Census has changed the boundaries of some MSAs in the intervening years, we collected the data at the county level and then mapped it to the current MSA borders.

Each data series was scored relative to the other metros so that the biggest positive change received a score of 100 and any zero or negative changes received a score of 0 (except for unemployment rate, where this was reversed). For each category, these scores were summed and then divided by the number of series in each category, for a highest possible category score of 100 and a lowest of 0. The three category scores were then summed and divided by three for a final score. The highest possible final score was 100 and the lowest was 0.

How the metros have changed

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Kali McFadden is a writer at MagnifyMoney. You can email Kali at kali.mcfadden@magnifymoney.com

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The Happiest States in the U.S.

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

In a new study, MagnifyMoney researchers sought to find out which state is home to the happiest people.

The methodology was inspired by a recent Oxford Economics study of the components of well-being, in which researchers found sleep is the largest factor contributing to well-being, followed by other health, lifestyle and economic factors.

In line with the Oxford team’s findings, MagnifyMoney evaluated how each of the 50 states rank on 20 factors in the categories of health, lifestyle, and prosperity. Based on an analysis of those elements, our study found the state where you live may impact your baseline level of happiness.

Top 10 happiest states


Minnesota is the happiest state. Minnesota didn’t rank highest in either of the three categories, but it ranked highest overall. The home of the Mall of America scored an overall 73.3 out of 100. Minnesota ranked third in health, third in lifestyle and sixth overall in prosperity. Minnesota is trailed by South Dakota with an overall score of 72 and Colorado with 70.5.

Midwesterners are generally happier than people living in the South. Of the top ten happiest states in our ranking six of them — Minnesota, North Dakota, South Dakota, Wisconsin, Nebraska, and Iowa — are in the Midwest. And of the top ten unhappiest states, seven of the states — Louisiana, Alabama, Mississippi, Kentucky, Arkansas, Tennessee and Georgia — are in the South.

No. 1 in health: South Dakota. South Dakota ranked first in the health category and second overall in prosperity after weighing all factors. Boosting the state’s ranking was its first-place rank in the percentage of people who get at least seven hours of sleep. South Dakota ranked sixth in the state health index. The state landed 20th in lifestyle, which brought it down just below Minnesota to the number two spot overall in our happiest states ranking.

No. 1 in lifestyle & prosperity: Utah. Utah was top in both lifestyle and prosperity in our analysis. In the lifestyle category, Utah had the third lowest divorce rate and ranked first in volunteering (43.20%), beating out Minnesota by nearly 10 basis points. In prosperity, the state ranked tenth overall in homeownership (71.87%) and had the fifth lowest unemployment rate at 4%.
However, the state ranked ranked among the bottom 10 states in depression, suicide rate and air quality. It ranked 48th, 46th and 47th in each factor, respectively, bringing its ranking in the health category down to 21st overall and thwarting its shot at No. 1.

Top 10 unhappiest states


Louisiana is the unhappiest state

According to our findings, Louisiana was the unhappiest state to live in, with an overall score of 29.8. The state was weighed down by its bottom ranking in both lifestyle and prosperity factors, although it ranked a little higher in overall health. In lifestyle the state ranked 50th in the percentage of people married with and without children. In health the state ranked 50th again in volunteering (18.40%) and 42nd overall in the percentage of people who exercise (28.20%).

In prosperity, Louisiana ranked 49th in the percentage of people with a late payment in their credit history and an unemployment rate of 7.10% landed Louisiana 41st place in that category. Louisiana ranked 47th in median household income with an average of $45,146.

Rhode Island and West Virginia preceded Louisiana to round out the top three unhappiest states. What’s bringing these states down? Rhode Island ranked 49th in lifestyle and West Virginia ranked 49th in the health category.

Keys to happiness


As the Oxford researchers found, focusing on sleep, health, lifestyle and prosperity can lead to a life of wellness.

“Happiness comes when you’re thriving in your relationships, career, finances, health and in your engagement with your community,” said Victoria Craze, co-founder and life coach at Wellbeing Coaches.

Of course, that can be easier said than done. Only about 7 percent of people worldwide thrive in all areas of wellness, a 2010 study found.

Each of the key elements of happiness are related, however, so even making changes in one area may benefit you in others, Craze noted. To get enough sleep, for example, exercise is helpful, which can also have good long-term health effects. For stress, exercise again is a recommendation as well as eating healthier and practicing breathing techniques such as meditation. And to be more active, Craze recommended an effort to walk a bit more than you already do.

“Any additional movement do each day is a good thing that can help improve your well-being over time,” said Craze.

The full ranking

Methodology

Using the Sainsbury’s Living Well Index (September 2017) from Oxford Economics analysis of well-being in Britain as a broad guide, we used 20 factors in the categories of health, lifestyle, and economic for each of the 50 states. Health and lifestyle factors had double the weight of economic stability, and within health, sleep was weighted three times higher than the other factors.
Health:

  • Diagnosed depression rate in adults
  • Suicide rate
  • State health index
  • Life expectancy in years
  • Air quality
  • People who get at least seven hours of sleep

Lifestyle:

  • Number of hours spent outside of work
  • Volunteer rate
  • People who are married
  • Married people who have children
  • Average household size
  • People who don’t use all of their vacation time
  • Divorce rate
  • Social ties relative to other states
  • People who regularly exercise

Economic Stability (Prosperity):

  • People who own their own homes
  • Median household income
  • Unemployment rate
  • Regional price parity
  • People who have at least one late payment on their credit reports

Sources include the U.S. Census Bureau, the Centers for Disease Control and Prevention, the Environmental Protection Agency, the Bureau of Economic Analysis, Gallup Inc., Blue Cross Blue Shield, Corporation for National and Community Service, Project: Time Off, and STAT News.

Data

Final state rankings

Detailed state rankings

Media contact: Kellie Pelletier/Kpelletier@magnifymoney.com

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

Brittney Laryea
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Brittney Laryea is a writer at MagnifyMoney. You can email Brittney at brittney@magnifymoney.com

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How These Newlyweds Tackled Six-Figure Debt in Their First Year of Marriage

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Newlyweds Faith, 27, and Leo, 30, eliminated over $100,000 of debt in their first year of marriage.

When Faith and Leo Jean-Louis tied the knot in June 2017, they carried a joint debt load of over $200,000 down the aisle along with them.

Even before their nuptials, the Atlanta couple decided to make paying off the balance a priority in their first few years of marriage, no matter what. Now, about a year into their debt payoff mission, the couple has already knocked out more than $100,000 of their debt.

It was no easy feat, and required a commitment to working longer hours and seeing less of their family, friends and each other. The couple recently spoke with MagnifyMoney about the lessons they learned in their first year paying down their debt, and their plan for how they’ll approach things differently in the years to come.

‘The biggest thing standing in our way was debt’

The Jean-Louises met back in 2014, when they were both newcomers to Atlanta. Leo, 30, who had moved to the city to begin his career as an occupational therapist, met Faith, 27, a nursing student at Emory University, at church.

They started dating a few months later, and in 2016, they got engaged. In premarital counseling sessions with their pastor, the couple was encouraged to think about the purpose of their marriage. They both agreed that giving to others — not just their money, but also their time — was a major desire.

“One of the questions we had to ask ourselves was: ‘What do we want life to look like in three years, five years, 10 years from now?’” Leo said. “The biggest thing standing in our way was debt.”

Choosing a strategy

Faith and Leo both earned undergraduate and master’s degrees, and together they owed around $194,000 in student loans. The rest of the $211,000 obstacle came from credit card debt, which included wedding expenses and their honeymoon to Greece.

The couple hired a certified financial planner to help start the process. At first, they tried to prioritize debts by highest interest rate, but it became too overwhelming, as some of their biggest debts had the highest rates. They switched gears and opted to use the debt snowball method instead, which involves paying off debts with the smallest balances first as a way to gain easy wins early and build momentum. This meant tackling the credit card debt before worrying about the mountain of student loans.

Their adviser recommended they use some of their savings to make a lump payment on their loans. They paid $10,000 toward that in August 2017, and things took off from there.

“That’s when we knew that this was really serious,” Leo said. “That really got us kick-started.”

Putting in extra hours

Working extra shifts and a part-time job were a huge part of the couple’s strategy to whittle away their debt.

Leo took on additional therapy shifts on weeknights and Saturday afternoons. Faith, meanwhile, kept her side job from graduate school, where she worked as an overnight nurse for new mothers. Pulling these night shifts five or six times a week was exhausting, she said.

“I’d go to my full-time job, leave around 5 or 5:30 p.m., come back home, take a quick nap and then wake up to go to my overnight job, and then leave for my full-time job again that morning,” Faith said.

Their second paychecks — other than the 10 percent they tithed to their church — went entirely toward the debt. Thanks to careful budgeting and self-control with entertainment and spending, the Jean-Louises managed to live entirely off the money from their primary jobs as a nurse and occupational therapist.

Spending little time with each other was a sacrifice for the newlyweds, but seeing their debt decline helped them keep focused.

“We just kept reminding ourselves: ‘Hey, life is not always going to be this way,’” Leo said. “We knew we’d have the next 20, 30, 40 years to live how we want to if we could just sacrifice for this short period of time.”

One side benefit was that they bonded more as a couple.

“We had to constantly be in communication: asking each other how we were doing, encouraging one another when we were tired,” Leo said.

Small savings add up

Faith and Leo track their progress and share updates for friends and family on social media. (Photo credit: Leo Jean-Louis)

When they first started tackling their debt, the couple put together a budget by tallying all the money they were spending each month and looking for places where they could cut back. Leo said it was “trial and error” at first, but once they realized where they could save the most, they began to make major lifestyle changes.

They started carpooling to work, which saved around $100 per month. They saved about $240 every month by packing their lunches for work. They even saved between $50 and $60 each month by forgoing a cable plan, instead using an Amazon Fire Stick, which retails for $40, to watch TV shows online.

Instead of going out to restaurants and movie theaters on weekends, they hung out at their friends’ homes. Rotating houses each time, these potluck-style dinners helped them stay social without expensive nights on the town.

A long journey ahead

With half of their debt behind them, Faith said in June that she and Leo would be taking a month or so to relax. They’re planning a vacation to Costa Rica, exploring Atlanta and dialing back on their second jobs.

“I still think we want to be aggressive with it, because we don’t want this to last much longer, however, right now we are taking some time to have a break,” Faith said. “We still have our part-time jobs, but we’ve calmed down with the amount of shifts we’re taking.”

Still, the Jean-Louises are confident that they’ll stay committed to their money-conserving lifestyle, a big part of which involves the small, day-to-day decisions that have saved them so much over the past year.

The couple’s goal is to be debt-free by December 2019 — a task they think is easily attainable if they keep living this way. They also might receive help from Faith’s employer, which will allow her to enter a repayment plan that could help pay off as much as $50,000 of the remaining total. Faith will become eligible for the plan in fall 2019, and they’ll make their decision then.

“I think it’s just about remembering that this is temporary,” Faith said. “It’s not going to last — it’s just a season we have to go through.”

Faith and Leo’s tips for overcoming debt

The Jean-Louises don’t see their story as an anomaly. The couple uses Leo’s Instagram page to inspire others trying to conquer debt and offer advice.

“We want people to know that they can get out of debt, too,” Leo said.

Here are Faith and Leo’s four tips for tackling debt:

  • Think about “the why”: Leo admits that the total can be overwhelming, which is why he suggests people first consider their reasons for wanting to be debt-free. “If you can dream a little bit about where you want to be, that should give you enough motivation to take the first step,” he said.
  • Write down your debts: Actually look at the numbers, consider what you owe and what you could end up paying over a lifetime if you took a more conservative approach to paying off debt, such as if you were only making the minimum payment each month.
  • Track your expenses: Life changes, whether small or large, are needed. Look at every aspect of your monthly spending and find ways to save, no matter how miniscule they may seem. “Let’s say you decide to go to Starbucks every morning. Is Starbucks that necessary? Or can you make your own coffee at home?” Faith said. “It’s just seeing what’s important to you and what you can decrease or cut back on.”
  • Remember to enjoy yourself: Always make time to have fun, even if you have a rigid plan. “You can make a budget for the things you like to do, which will help you stay focused and not get so overwhelmed,” Faith said.

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

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Credit Cards, Featured, News

Average Credit Card Debt in the U.S. in 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Even as household income and employment rates are ticking up in the U.S., credit card balances are at all-time highs. And as the Fed raises rates, credit card rates rise in tandem, meaning consumers could pay billions in extra interest charges.

We’ve updated our statistics on credit card debt in America to illustrate how much consumers are now taking on.

  • Americans paid banks $104 billion in credit card interest and fees in 2018, up 11% from the prior year, and up 35% over the last five years, as Fed rate increases have been passed on to consumers. MagnifyMoney analyzed FDIC data through March, 2018 for each bank whose deposits are insured by the FDIC.
  • With potentially four Fed rate hikes left to come this year, we estimate the increase in interest and fees paid in the coming year will once again be above 10%, putting Americans on track to pay over $110 billion. Our analysis of the impact of Fed rate hikes found credit card rates are the most sensitive to Fed rate hikes, rising more than twice as fast as mortgage rates.
  • Average APRs on credit card accounts assessed interest are now 15.5%, up nearly 300 basis points in five years, according to the Federal Reserve.

  • Total revolving credit balances are $1.04 trillion as of May, 2018. The figure, reported monthly by the Federal Reserve, is the total amount of revolving credit balances reported by financial institutions, the overwhelming majority of which are credit and retail card balances, according to the CFPB. As of March 2018, non- card-related revolving balances such as overdraft lines of credit were approximately $73 billion according to our analysis of the FDIC data used by the Federal Reserve to calculate total revolving balances.

  • Americans carry $687 billion in credit card debtthat is not paid in full each month. This estimate includes people paying interest, as well as those carrying a balance on a card with a 0% intro rate. We based the estimate on a CFPB study of credit card account data that found 29% of total credit card balances are paid off each month, implying 71% of credit card balances revolve each month. We applied the percentage to the Federal Reserve’s revolving credit balance data less $72 billion in non-credit card revolving debt to reach $687 billion in credit card balances carried over month to month.
  • 44% of credit card accounts aren’t paid in full each month, according to the American Bankers Association. Those that don’t pay in full tend to have higher balances, which is why the percentage of balances not paid in full (71%) is higher than the percentage of accounts not paid in full (44%).
  • The average credit card balance is $6,348 for individuals with a credit card, according to Experian. This excludes store credit cards, which have an average balance of $1,841. Both figures include the statement balances of individuals who pay their balance in full each month.

Credit card use

  • Number of Americans who actively use credit cards: 175 million as of 2018, according to Transunion
  • Average number of credit cards per consumer: 3.1, according to Experian. That doesn’t include an average of 2.5 retail credit cards.
  • Number of Americans who carry credit card debt month to month: 70 million.

Credit card debt

The following estimates only include the credit card balances of those who carry credit card debt from month to month — they exclude balances of those who pay in full each month.

  • Total credit card debt in the U.S. (not paid in full each month): $687 billion
  • Average APR: 15.54% (also excludes those with a 0% promotional rate for a balance transfer or purchases)
    • This estimate comes from the Federal Reserve’s monthly reporting of APRs on accounts assessed interest by banks.

Credit card balances

The following figures include the credit card statement balances of all credit card users, including those who pay their bill in full each month.

  • Total credit card balances: nearly $1.04 trillion as of May 2018, an increase of 5% percent from the previous year. This includes credit and retail cards, and a small amount of overdraft line of credit balances.
  • Average credit card balance: $6,358, according to Experian (excludes retail credit cards, which have lower balances. The average consumer has $1,841 in balances on retail cards and we estimate combining all consumers with retail or credit card debt the average is approximately $5,000 per individual). All averages include those who pay their bill in full each month.

Who pays off their credit card bills?

According to the American Bankers Association, as of the end of 2017, accounts that are paid in full versus carrying debt month to month comprise the following mix of open credit card accounts:

  • Revolvers (carry debt month to month): 44 percent of credit card accounts
  • Transactors (use card, but pay in full): 29.5 percent of credit card accounts
  • Dormant (have a card, but don’t use it actively): 26.5 percent of credit card accounts

Delinquency rates

Credit card debt becomes delinquent when a bank reports a missed payment to the major credit reporting bureaus. Banks typically don’t report a missed payment until a person is at least 30 days late in paying. When a consumer doesn’t pay for at least 90 days, the credit card balance becomes seriously delinquent. Banks are very likely to take a total loss on seriously delinquent balances.

Delinquency rates peaked in 2009 at nearly 7%, but in 2018 they have remained below 3%. 

Debt burden by income

Those with the highest credit card debts aren’t necessarily the most financially insecure. According to the 2016 Survey of Consumer Finances, the top 10 percent of income earners who carried credit card debt had nearly twice as much debt as average.

However, people with lower incomes have more burdensome credit card debt loads. Consumers in the lowest earning quintile had an average credit card debt of $2,100. However, their debt-to-income ratio was 13.9 percent. On the high end, earners in the top decile had an average of $12,500 in credit card debt. But debt-to-income ratio was just 4.8 percent.

Income Percentile

Median Income

Average CC Debt

CC Debt: Income Ratio

0%-20%

$15,100

$2,100

13.9%

20%-40%

$31,400

$3,800

12.1%

40%-60%

$52,700

$4,400

8.3%

60%-80%

$86,100

$6,800

7.9%

80%-90%

$136,000

$8,700

6.4%

90%-100%

$260,200

$12,500

4.8%

 

Although high-income earners have more manageable credit card debt loads on average, they aren’t taking steps to pay off the debt faster than lower income debt carriers. In fact, high-income earners are as likely to pay the minimum as those with below average incomes. If an economic recession leads to job losses at all wage levels, we could see high levels of credit card debt in default.

Generational differences in credit card use

In 2017, Generation X surpassed the baby boomer generation to have the highest credit card balances. Experian estimates that on average, Generation X has a balance of $7,750 per person, 21.94% more than the national average ($6,354). Boomers carry nearly as much as Generation X with an average balance of $7,550.

At the other end of the spectrum, millennials, who are often characterized as frivolous spenders and are too quick to take on debt, have nearly the lowest credit card balances. Their median balance clocks in at $4,315. The youngest generation, Gen Z, has the smallest average balance of $2,047 per person.34

How does your state compare?

Using data from the Federal Reserve Bank of New York Consumer Credit Panel and Equifax, you can compare median credit card balances and credit card delinquency.

State

Credit Card Debt Per Debtor

Credit Card Debt Per House

Alabama

$3,710.56

$7,198.48

Alaska

$5,879.85

$11,406.91

Arizona

$4,299.70

$8,341.42

Arkansas

$3,289.01

$6,380.69

California

$4,569.51

$8,864.85

Colorado

$4,898.56

$9,503.20

Connecticut

$5,171.89

$10,033.47

Delaware

$4,338.88

$8,417.42

Florida

$4,318.35

$8,377.59

Georgia

$4,727.46

$9,171.27

Hawaii

$5,330.46

$10,341.09

Idaho

$3,791.84

$7,356.18

Illinois

$4,412.71

$8,560.65

Indiana

$3,624.05

$7,030.65

Iowa

$3,169.16

$6,148.17

Kansas

$3,854.05

$7,476.85

Kentucky

$3,457.67

$6,707.88

Louisiana

$3,767.91

$7,309.75

Maine

$3,905.56

$7,576.78

Maryland

$5,287.61

$10,257.96

Massachusetts

$4,720.53

$9,157.83

Michigan

$3,458.51

$6,709.51

Minnesota

$4,257.26

$8,259.08

Mississippi

$3,204.95

$6,217.60

Missouri

$3,763.46

$7,301.11

Montana

$3,732.83

$7,241.69

Nebraska

$3,594.46

$6,973.25

Nevada

$4,263.19

$8,270.59

New Hampshire

$4,943.44

$9,590.27

New Jersey

$5,361.06

$10,400.47

New Mexico

$4,185.93

$8,120.71

New York

$4,969.84

$9,641.50

North Carolina

$4,124.04

$8,000.63

North Dakota

$3,756.19

$7,287.00

Ohio

$3,738.95

$7,253.56

Oklahoma

$4,038.90

$7,835.47

Oregon

$3,881.17

$7,529.48

Pennsylvania

$4,209.21

$8,165.86

Rhode Island

$4,376.34

$8,490.10

South Carolina

$4,187.65

$8,124.04

South Dakota

$3,608.28

$7,000.07

Tennessee

$3,903.24

$7,572.28

Texas

$4,937.00

$9,577.78

Utah

$3,775.21

$7,323.92

Vermont

$4,199.77

$8,147.56

Virginia

$5,404.32

$10,484.38

Washington

$4,568.09

$8,862.09

West Virginia

$3,381.36

$6,559.84

Wisconsin

$3,410.29

$6,615.96

Wyoming

$3,944.72

$7,652.76

 

State

Silent

Boomers

Gen X

Millennials

Gen Z

Alaska

$5,456

$9,495

$8,995

$4,464


$1,518


Alabama

$3,511

$6,461

$6,485


$3,324


$1,455




Arkansas

$3,194

$5,995

$6,197


$3,240


$1,803


Arizona

$4,149

$6,967

$6,778


$3,575


$1,555


California

$4,232

$7,050

$6,578


$3,654


$1,596


Colorado

$4,004

$7,499

$7,439


$3,833



$1,514


Connecticut

$4,091

$8,179

$8,046


$3,716



$2,567


Dist. of Columbia

$5,486

$7,976

$7,393


$4,596



$2,814


Delaware

$4,147

$7,128

$7,144


$3,285



$1,608


Florida

$4,311

$7,047

$6,615


$3,639



$1,837


Georgia

$4,356

$7,517

$6,972


$3,540


$1,835


Hawaii

$4,386

$7,073

$7,355


$4,203


$1,657


Iowa

$2,367

$5,297

$6,163


$2,857


$935


Idaho

$3,477

$6,147

$6,332


$3,193


$928


Illinois

$3,641

$7,054

$7,040


$3,537


$1,556


Indiana

$3,137

$5,998

$6,174


$3,003


$1,402


Kansas

$3,187

$6,514

$6,930


$3,292


$1,421


Kentucky

$3,044

$5,727

$6,080


$3,082


$1,372


Louisiana

$3,679

$6,598

$6,561


$3,425


$1,971


Massachusetts

$3,481

$7,017

$7,022


$3,479

$1,882


Maryland

$4,341

$7,994

$7,458


$3,671


$1,749


Maine

$3,107

$6,054

$6,531


$3,375


$1,286


Michigan

$3,436

$6,049

$6,113


$2,971


$1,523


Minnesota

$3,025

$6,299

$6,898


$3,244


$1,338


Missouri

$3,265

$6,333

$6,757


$3,279


$1,346


Mississippi

$3,218

$5,634

$5,718


$3,043


$2,011


Montana

$3,285

$5,977

$6,868


$3,385


$1,506


North Carolina

$3,481

$6,566

$6,710


$3,397


$1,486


North Dakota

$2,141

$5,362

$6,646


$3,326


$1,467


Nebraska

$2,717

$5,909

$6,498


$3,136


$1,388


New Hampshire

$3,582

$7,140

$7,443


$3,519


$1,666


New Jersey

$4,126

$8,011

$7,882


$3,928


$2,241


New Mexico

$4,373

$6,906

$6,534


$3,532


$1,207


Nevada

$4,733

$6,993

$6,357


$3,700


$1,185


New York

$3,906

$7,127

$7,234


$3,986


$2,495


Ohio

$3,313

$6,383

$6,530


$3,135


$1,465


Oklahoma

$3,484

$6,789

$6,900


$3,493


$1,641


Oregon

$3,618

$6,502

$6,481


$3,245


$856


Pennsylvania

$3,282

$6,550

$7,059

$3,457


$1,545


Rhode Island

$3,524

$7,162

$7,313


$3,371


$1,786


South Carolina

$4,019

$6,537

$6,559


$3,281

$1,375


South Dakota

$2,584

$5,710

$6,900

$3,250


$1,531


Tennessee

$3,388

$6,309

$6,505


$3,308


$1,737


Texas

$4,350

$7,591

$7,119


$3,779


$1,945


Utah

$3,364

$6,411

$6,713


$3,070


$932


Virginia

$4,132

$7,956

$7,968


$3,985

$1,692


Vermont

$3,681

$6,197

$6,547


$3,297


$2,511


Washington

$3,947

$7,365

$7,190


$3,500


$1,355


Wisconsin

$2,740

$5,673

$6,289


$2,914


$992


West Virginia

$2,914

$5,573

$6,158


$3,238


$1,166


Wyoming

$3,523

$6,356

$6,889

$3,663

$1,442

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

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Citibank to Repay $335 Million to Consumers in CFPB Settlement

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

MagnifyNews-02-01

Last week, Citibank agreed to repay $335 million in fines to an estimated 1.75 million consumers, as a result of a settlement with the Consumer Financial Protection Bureau. The settlement found that Citibank failed to reassess and adjust APRs on 1.75 million credit card accounts over an eight-year period.

Under the Truth and Lending Act, creditors must reassess APRs at least once every six months and maintain proper documentation, providing written notice when APRs increase and why they rose.

While the act doesn’t require creditors to reduce consumers’ APRs, it does require them to take reasonable action to ensure they are charging consumers fair and reasonable rates. The CFPB found that Citibank was not abiding by these regulations, hence requiring the $335 million repayment to consumers.

While Citibank is required to repay consumers, they did not receive a fine from the CFPB since they, “self-identified and self-reported the violations to the Bureau, and self-initiated remediation to affected consumers.”

“Citi is pleased to have resolved the matter with the Bureau, and we reiterate our sincere apologies to our customers for not correcting these issues sooner,” Citibank said in a statement.

“Citi estimates that about 90 percent of the interest rate savings due to customers were delivered as required. Citi is currently issuing refunds for the remainder to 1.75 million credit card accounts. Refunds, which will average $190, will continue over several months and be largely completed by year-end.”

Consumers rights for getting APRs reevaluated

Per Chapter 3 of the Truth and Lending Act, consumers have several rights when it comes to APR increases and the subsequent revaluation required by creditors.

Here’s a breakdown of your rights:

  • Generally, APRs can’t be increased within the first year of account opening. There are a few exceptions that must be disclosed to be in effect; they include an increase due to: the end of a promotional period, a variable APR change, the end of a temporary hardship agreement or a minimum payment not received within 60 days of the due date.
  • Creditors must provide written notice if your APR is increased. This notice includes reasons why your APR increased.
  • If your APR was increased, it should be reevaluated at least once every six months. During these reviews, your creditor should reassess the factors it initially considered when it increases your rate, to see if those factors have changed and whether your rate can now decrease.

Tips to save on credit card interest

Complete a balance transfer. If you are currently carrying a balance on a credit card with a high APR, completing a balance transfer can be a great way to save on interest charges and get out of debt. You can transfer your balance to a balance transfer credit card offering a low or 0% intro period, and benefit from intro periods as long as 21 months. During the intro period, you can take the needed time to pay back balances while avoiding high interest charges. Just beware balance transfers typically come with a 3% fee, but this is often outweighed by the amount you save in interest. However, there are intro $0 balance transfer fee cards available that can increase your savings.

Use a card with an intro 0% APR for new purchases. If you carry a balance month to month or plan on making purchases that you can’t pay for by your statement due date, a credit card with an intro 0% APR for new purchases can save you money. These cards won’t charge interest during the intro 0% APR period — which can be as long as 20 months. So any recurring expenses you have or new purchases you may make won’t rack up interest charges. Just remember to pay your balance in full before the intro period ends so your balance isn’t hit with the ongoing APR.

Negotiate with your bank. Some banks are willing to work with you if you are struggling to make payments or are incurring high interest charges. You can try speaking with a bank representative to see if they can work out an agreement where they lower your APR. Even if it’s just temporary, a lower APR for a short period of time is better than none at all. Try to pay each bill on time and in full so you don’t have to worry too much about your APR and avoid interest charges.

Advertiser Disclosure: The card offers that appear on this site are from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all card companies or all card offers available in the marketplace.

Alexandria White
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