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College grads struggle early with debt

Financial issues are not always limited to people who are married and trying to raise a family or divorced and coping with support payments and the division of assets. According to one financial literacy company, problems with money can begin almost as soon as you are old enough to earn it. In fact, one survey showed that about 70 percent of college graduates make serious financial blunders within two years of receiving their degrees.

Colleges and universities are seeing this trend, and some are working to include financial literacy in their courses of studies, especially since many college graduates will be facing decades of student loan and credit card debt. Keeping your finances healthy is important if you want to avoid the burden of debt and the hardship of a damaged credit score.

Which debts affect my credit score?

Several factors can affect your credit score. You may be among the many who graduate from college without learning that missing payments on bills and debts can drop your credit rating almost immediately. Even one late payment may knock your credit score, making it difficult to obtain funds when you may need credit. More companies and creditors are reporting delinquent payments to credit reporting agencies, including the following:

  • Car loans
  • Student loans
  • Credit cards
  • Utility payments

Missing utility payments is something you may not realize can hurt your credit score. Unfortunately, if a utility company sends your delinquent account to a collection agency, it will likely report it to the credit agency as well.

Are you exceeding your limit?

Credit card debt may be one of the most dangerous temptations for young people just out of college and struggling to find work. Financial analysts consider you a high risk for credit if your balance exceeds your credit card limit by 30 percent. Almost 40 percent of those recent college graduates surveyed carry a balance within that dangerous level.

In New York and across the country, credit card debt is at an all-time high. It is just one area of finances in which consumers like you, whether fresh out of college or well-seasoned, find themselves struggling to meet their monthly payments. If those payments have become overwhelming, you may realize your debt is affecting nearly every area of your life. It may be time to explore the options available for debt relief.

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