Consumer Financial

Protection Bureau April 2015

YOUR MONEY, YOUR GOALS

A financial empowerment 

toolkit for Social Services 

programs

Table of contents 

MODULE 1: Introduction to the toolkit .....................................................................1
 

An introduction to the CFPB............................................................................. 2
 

Financial empowerment and your life .............................................................. 4
 

Financial empowerment: A way to improve client and program outcomes .... 4
 

Making referrals ................................................................................................ 6
 

The goal of Your Money, Your Goals................................................................ 7
 

MODULE 2: Assessing the situation ........................................................................9
 

Tool 1: Financial empowerment self-assessment ...........................................11
 

Tool 2: Client goal and financial situation assessment.................................. 21
 

MODULE 3: Starting the conversation ...................................................................27
 

When should I bring up money topics? ..........................................................28
 

How should I bring up money topics? ............................................................ 29
 

MODULE 4: Emotional and cultural influences on financial decisions ...............39
 

Emotional influences on financial decisions .................................................. 39
 

Cultural influences on financial decisions ......................................................40
 

Cultural conflicts ............................................................................................. 41
 

How can this understanding help my clients?................................................ 41
 

MODULE 5: Using the toolkit ..................................................................................43
 

How does it work? ........................................................................................... 43
 

i YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 1: Client financial empowerment checklist ............................................ 45
 

MODULE 6: Setting goals ........................................................................................49
 

Setting SMART goals.......................................................................................50
 

Turning goals into savings targets .................................................................. 52
 

What about revising goals? ............................................................................. 54
 

Saving for education........................................................................................ 55
 

Tool 1: Goal setting tool.................................................................................. 57
 

MODULE 7: Saving for the unexpected, emergencies, and goals .......................61
 

What is savings? .............................................................................................. 61
 

How to save .....................................................................................................62
 

Savings and public benefits............................................................................. 63
 

Savings plan ..................................................................................................... 63
 

What are the benefits of a savings plan?......................................................... 65
 

A safe place to save .......................................................................................... 67
 

Direct deposit and savings ..............................................................................68
 

Tool 1: Savings plan .........................................................................................71
 

Tool 2: Benefits and asset limits .................................................................... 75
 

Tool 3: Finding a safe place for savings ......................................................... 79
 

Tool 4: Increasing your income through tax credits......................................83
 

MODULE 8: Managing income and benefits ..........................................................87
 

Income ............................................................................................................. 87
 

Benefits ............................................................................................................88
 

Getting income ................................................................................................89
 

Tool 1: Income and financial resource tracker ............................................... 93
 

Tool 2: Strategies for increasing sources of cash and financial resources .... 97
 

ii YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 3: Cash, paychecks, direct deposit, payroll cards, and EBT— 

understanding the benefits and risks.............................................................101
 

MODULE 9: Paying bills and other expenses ......................................................107
 

Paying bills..................................................................................................... 108
 

When cash is short: Prioritizing bills ............................................................. 111
 

Tool 1: Spending tracker................................................................................ 115
 

Tool 2: Bill calendar.......................................................................................121
 

Tool 3: Strategies for cutting expenses ........................................................ 125
 

Tool 4: When cash is short—prioritizing bills and spending ....................... 129
 

MODULE 10: Managing cash flow.........................................................................133
 

What is a cash flow budget? .......................................................................... 133
 

Making a cash flow budget ............................................................................ 134
 

Tool 1: Cash flow budget ............................................................................... 135
 

Tool 2: Cash flow calendar ........................................................................... 145
 

Tool 3: Improving cash flow checklist .......................................................... 149
 

MODULE 11: Dealing with debt .............................................................................157
 

What is debt? ..................................................................................................157
 

Good debt, bad debt?......................................................................................157
 

Tool 1: Debt management worksheet........................................................... 169
 

Tool 2: Debt-to-income worksheet ...............................................................173
 

Tool 3: Debt-reduction worksheet ................................................................177
 

Tool 4: Student loan debt ..............................................................................181
 

Tool 5: When debt collectors call ................................................................. 185
 

MODULE 12: Understanding credit reports and scores .....................................193
 

What are credit reports? ................................................................................ 193
 

iii YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Why do credit reports and scores matter? .................................................... 193
 

What is in a credit report? ............................................................................. 194
 

Negative information .................................................................................... 196
 

Example credit report.....................................................................................197
 

Disputing errors on credit reports ................................................................204
 

What are credit scores? .................................................................................207
 

Tool 1: Getting your credit reports and scores ..............................................211
 

Tool 2: Credit report review checklist ...........................................................217
 

Tool 3: Improving credit reports and scores................................................223
 

MODULE 13: Evaluating financial service providers, products, and 

services .............................................................................................................227
 

Financial service providers ........................................................................... 227
 

Choosing financial products..........................................................................228
 

Managing a bank account..............................................................................229
 

Tool 1: Selecting financial service products and providers.......................... 235
 

Tool 2: Evaluating financial service providers .............................................239
 

Tool 3: Types of financial services................................................................243
 

Tool 4: Opening account checklist ...............................................................249
 

MODULE 14: Protecting consumer rights ............................................................255
 

Consumer complaints.................................................................................... 256
 

It’s your money—be aware and take care...................................................... 257
 

Tool 1: Red flags............................................................................................ 261
 

Tool 2: Protecting your identity ...................................................................263
 

Tool 3: Submitting a complaint....................................................................269
 

Tool 4: Learning more about consumer protection..................................... 273
 

iv YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
MODULE 1: 

Introduction to the toolkit 

Welcome to the Consumer Financial Protection 

Bureau’s Your Money, Your Goals: A financial 

empowerment toolkit for social services 

programs! If you’re reading this, you are 

probably a case manager, or you work with case 

managers. 

Finances affect nearly every aspect of life in the 

United States. But many people feel overwhelmed 

by their financial situations, and they don’t know 

where to go for help. As a case manager, you’re in 

a unique position to provide that help. Clients 

already know you and trust you, and in many 

cases, they’re already sharing financial and other 

personal information with you. The financial 

stresses your clients face may interfere with their 

progress toward other goals, and providing 

financial empowerment information and tools is 

a natural extension of what you are already doing. 

What is “financial empowerment” and how is it 

different from financial education or financial 

literacy? 

Financial education is a strategy that provides 

people with financial knowledge, skills, and 

resources so they can get, manage, and use their 

money to achieve their goals. Financial education 

Case manager 

The term “case manager” is used 

throughout this toolkit, and it refers 

to anyone who works directly with 

people with low or moderate income 

in a wide range of organizations and 

on a broad range of issues. Staff may 

have different titles, but they 

generally come from non-profit or 

private sector organizations or city, 

county, or tribal governmental 

organizations, and they are generally 

responsible for the following with 

clients: 

 Conducting needs assessments 

 Developing action plans with 

clients 

 Providing resources and referrals 

needed to implement action plans 

 Monitoring progress and 

evaluating results 

1 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Financial empowerment 

Empowerment is the process of 

increasing the capacity of people to 

make choices and transform those 

choices into actions and desired 

results, according to the World Bank. 

Financial empowerment is building

the knowledge and ability of 

individuals to manage money and use 

financial services products that work 

for them. 

is about building an individual’s knowledge, 

skills, and capacity to use resources and tools, 

including financial products and services. 

Financial education leads to financial literacy. 

Financial empowerment includes financial 

education and financial literacy, but it is focused 

both on building the ability of individuals to 

manage money and use financial services and on 

providing access to products that work for them. 

Financially empowered individuals are informed 

and skilled; they know where to get help with 

their financial challenges. This sense of 

empowerment can build confidence that they can 

effectively use their financial knowledge, skills, 

and resources to reach their goals. 

We designed this toolkit to help you help your clients become financially empowered 

consumers. This financial empowerment toolkit is different from a financial education 

curriculum. With a curriculum, you are generally expected to work through most or all of the 

material in the order presented to achieve a specific set of objectives. This toolkit is a collection 

of important financial empowerment information and tools you can access as needed based on 

the client’s goals. In other words, the aim is not to cover all of the information and tools in the 

toolkit - it is to identify and use the information and tools that are best suited to help your 

clients reach their goals. 

An introduction to the CFPB 

CFPB is the abbreviation for the Consumer Financial Protection Bureau. The CFPB’s mission is 

to make markets for consumer financial products and services work for Americans—whether 

they are applying for a mortgage, choosing among credit cards, or using any number of other 

consumer financial products. 

Above all, this means ensuring that consumers get the information they need to make the 

financial decisions they believe are best for themselves and their families—that prices are clear 

up front, that risks are visible, and that nothing is buried in fine print. 

2 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

We are working to give consumers the information they need to understand the terms of their 

agreements with financial companies. We are working to make regulations and guidance as clear 

and streamlined as possible so providers of consumer financial products and services can follow 

the rules on their own. 

Congress established the CFPB through the Dodd-Frank Wall Street Reform and Consumer 

Protection Act of 2010 (Dodd-Frank Act). The Bureau: 

 Writes the rules for providers of financial products. 

 Oversees compliance with the rules. 

 Brings enforcement actions to stop violations. 

 Educates the public to help them navigate the market for financial services. 

 Answers consumers’ questions, handles their complaints, and shares data with the public 

about the consumer financial experience. 

Our primary strategies are: 

 Education—An informed consumer is the first line of defense against harmful 

practices. 

 Enforcement—We supervise banks, credit unions, and other financial companies, and 

we enforce Federal consumer financial laws. 

 Study—We gather and analyze available information to better understand consumers, 

financial services providers, and consumer financial markets. 

The Office of Financial Empowerment within the Division of Consumer Education and 

Engagement developed this toolkit because case managers like you meet with thousands of 

consumers that need high quality, unbiased financial information and tools to help them 

address financial issues more effectively. This toolkit can help you help your clients reduce 

financial stress as they become more financially empowered. 

We hope you will use this information, the tools found within this toolkit, and the resources at 

http://www.consumerfinance.gov with as many of your clients as possible. As you do, you’ll help 

inform and empower the individuals in the community you serve to manage their finances in 

ways that achieve their goals and dreams. 

3 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Financial empowerment and your life 

Case managers and financial 

empowerment 

As a case manager, you are in a good 

position to provide financial

empowerment services to your

clients. Case managers like you have 

access to and the trust of millions of 

individuals who are most in need of 

financial empowerment services. You 

may feel more equipped and 

empowered to provide these services 

when you read the content and use 

the tools provided in the toolkit. 

As a case manager, you may sometimes hesitate 

to share information about financial 

empowerment, because you feel like you don’t 

know enough about it. Or you may feel like you 

know the information but haven’t applied the 

information and tools to your own life. In other 

words, you might sometimes feel like you don’t 

have the “right” to provide financial 

empowerment information, because you may feel 

your own financial house may not fully be in 

order. 

You can help your clients face money issues that 

may be complicating their lives if you feel 

knowledgeable about money and comfortable in
 

your own approach to money management,
 

credit, debt, and financial products. As you work
 

through each module of this toolkit, you will learn both the information and how the tools work. 

As you try out the tools, you may also find ways to use your money to reach your own goals more
 

efficiently and effectively. 

Financial empowerment: A way to improve 

client and program outcomes 

Sharing financial empowerment information and tools with clients may feel like a completely 

different job—one more thing you’re being asked to add to your workload. But, once you become 

familiar with the resources in this toolkit, we believe it can become natural to integrate its 

contents into the work you do. That’s because its core functions relate to what you already do. 

As a case manager, one of your job responsibilities is likely to be assessing client or client and 

family needs. The toolkit starts you off with an assessment to help you understand your clients’ 

goals and the financial situations they may be facing. 

4 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
You then develop a plan to help your clients 

receive your organization’s services. You often 

have to gather and coordinate information, tools, 

and other resources to share with them. 

This is the exact function of the toolkit. It brings 

together information, tools, and links to other 

resources you can use to help your clients build 

skills in managing money, credit, debt, and 

financial products. Having all those resources in 

one place can make it easier for you to integrate 

financial empowerment into your meetings with 

clients. 

We developed the Your Money, Your Goals 

toolkit because using the information and tools 

Financial empowerment and 

outcomes 

Financial empowerment may help 

your clients transition from the 

services they receive from your 

program. This won’t happen solely 

because of the way that you use the 

information and tools in the toolkit. 

But sharing the information and tools 

with your clients may help increase 

their financial stability and reduce 

their future need for services. 

can improve outcomes for both your clients and your program or organization. As you share the 

toolkit with them, your clients will have new understanding of financial concepts and financial 

tools to apply to their own lives and to reaching their goals of financial stability and selfsufficiency. 

Depending on what your clients need, you may be able to help them: 

 Set goals and calculate how much money they need to save to reach these goals 

 Save money 

 Establish an emergency savings fund 

 Access and use tax refunds 

 Track the specific ways they are using their money 

 Bring their cash flow budgets into balance 

 Make a simple plan to pay down debt 

 Get and review their credit reports 

 Fix errors on their credit reports 

5 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Evaluate financial products and services 

 Recognize when their consumer rights may have been violated and know how to take 

action 

With these new skills and tools, you may be able to help your clients transition from the services 

they receive from your organization, too. This won’t happen solely because of the way that you 

use the information and tools in the Your Money, Your Goals toolkit. But when you provide 

these services, they may play a role in helping your clients increase their financial stability and 

reduce their future need for services. 

Making referrals 

Are you expected to provide all of the help clients need? The answer, of course, is “no.” 

You can make a big difference in the lives of your clients by introducing them to financial 

empowerment and providing them with some new information and tools to help them solve 

specific financial challenges. 

Because your clients trust you, they look to you for quality information and referrals on topics 

such as the following: 

 “My credit report has information that’s not accurate. How can I fix it?” 

 “How can I know if the school loan I can get at the bank is better than one I can get at 

school?” 

 “Should I borrow money from my credit card or take out a small loan to cover my bills 

until my next paycheck?” 

 “My employer says I have to have direct deposit. Everywhere I go, the banks and credit 

unions seem to charge fees. How can I find the right account for me?” 

But some of your clients may need more help—help you may not feel comfortable providing 

because it is technical, beyond what you feel comfortable addressing, or not available within 

your organization. This is where your resource and referral network will be important. 

Referral partners in your community may include certified, non-profit credit counselors, 

independent loan specialists, free volunteer tax assistance sites sponsored by the IRS, and 

6 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

financial education programs, among others. 

Referral partners 

When identifying referral partners, 

make sure they: 

 Have expertise in the area for 

which you are referring clients to 

them 

 Have the time and interest to 

meet with and assist your clients 

 Are objective, which means they 

can show clients the potential 

positive and negative 

consequences of specific actions 

 And will not sell products or 

services in the context of helping 

your clients 

These referral partners are often found at nonprofit agencies. It is important that your referral 

base of experts does not try to sell products or 

services to clients when they are seeking financial 

empowerment assistance. It’s also important that 

these partners are objective—able to show your 

clients the upside and the downside of specific 

actions they take and the impact these actions 

have on their financial situations. 

To get you started in making these types of 

referrals, there are instructions and a template 

for making a referral guide in the supplemental 

module entitled Making a financial 

empowerment resource and referral guide. If 

you are working with a local financial 

empowerment trainer, this person has or will 

provide you with a list of websites and local 

organizations you may find helpful in your work 

with clients. 

The goal of Your Money, Your Goals 

The goal of the Your Money, Your Goals toolkit is to improve client outcomes by making it 

easier for you as a case manager to help clients become more financially empowered. 

The Your Money, Your Goals toolkit is divided into 14 modules: 

 Modules 1 through 5 are introductory modules. 

 Modules 6 through 14 include information on specific topics and tools clients can use to 

put that information to work. 

You should note that these modules are designed to be used as needed. Because the process is 

designed to be client-driven, this isn’t a curriculum that requires you to start with 

Module 6: Setting goals and work all the way through Module 14: Protecting consumer rights. 

7 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Consider each module a specific set of tools to be 

used as needed with each client. 

For example, you may have a client who has just 

lost her job. Starting with Module 6: Setting 

goals would likely not be useful to this client. But 

tips for managing cash flow and identifying new 

resources if she doesn’t have enough cash to 

cover basic living expenses (Module 10: 

Managing cash flow and Module 8: Managing 

income and benefits) could be useful for this 

client at this particular time. 

You may have a client who wants to get out of 

debt. A focus on cash flow (Module 10: 

Managing cash flow) may be useful, but you and 

the client might decide to start by developing a 

simple plan to lessen her debt (Module 11: 

Dealing with debt). 

If your work only allows you to meet with a client 

infrequently—or even just once—this toolkit will 

also help you identify ways to start a 

conversation that opens the door for you to make referrals to others in your community who 

may provide financial education or work with your client to build financial empowerment. 

To make the best use of the toolkit, however, we advise not giving clients all of the tools at once. 

Getting too many tools at one time would likely be overwhelming for most clients. A better 

approach is to identify the topic and tool that will make the biggest difference for each client. If 

you are going to send tools home with your client, limit it to one or two that you 

have worked with them on how to use. If you give them too many tools at once, none of 

the tools are likely to be used. 

The Consumer Financial Protection Bureau (CFPB) has prepared this material as a resource for the public. This material is provided 

for educational and information purposes only. It is not intended to be a replacement for the guidance or advice of an accountant, 

certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or actions of the 

individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are limited to the 

materials that the CFPB has prepared. 

8 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Giving clients tools 

Giving clients tools to take home to 

work on can be helpful. At home, they 

may have access to accurate 

information to complete the tools. 

But take care to not send too many 

tools home with them at once. 

Getting all of the tools at once or even 

five tools at one time can be 

overwhelming for most clients. A 

better approach is to identify the 

topic and tools that will make the 

biggest difference for each client at 

that specific time. 

And if you decide to send tools home 

with your client, limit it to just one or 

two that you have shown them how to 

use. 
 

 

MODULE 2: 

Assessing the situation 

Before you start providing financial empowerment services to clients, we want to be sure you 

have some tools to help you figure out what your clients may need. 

We also want to give you tools to understand your own knowledge and level of confidence about 

money management, and the opportunities you have to provide financial empowerment services 

to clients. 

In this module of the Your Money, Your Goals toolkit, we provide two assessment tools to give 

you a starting point. The assessment tools include the following: 

Tool 1: Financial Empowerment Case Manager Self-Assessment is a three-part tool to help you 

understand how much financial knowledge you already have. Learning more will not only 

benefit your clients, but may also benefit you as you apply what you learn to your own life. 

Tool 2: Client Goals and Financial Situation Assessment is designed to help you and your client 

understand the client’s goals and financial situation. This information can help you target the 

right module of the toolkit for each client. For example, if a client has a goal to buy a car or a 

home, you can target Module 12: Understanding credit reports and scores because learning 

how to improve his credit history may help him qualify for a lower cost loan. If you have a client 

that is struggling to make ends meet every month, you can target Module 10: Managing cash 

flow. 

This tool will help you match each client’s goals and financial situation with specific modules 

and tools within the toolkit. 

9 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

 

Tool 1: 

Financial empowerment selfassessment 

Some case managers may find the idea of 

providing financial empowerment information to 

clients overwhelming. For some, it’s because they 

feel like they just don’t know enough about it. But 

the truth is that no one knows everything there is 

to know about financial empowerment. 

Since financial empowerment covers a wide range 

of topics, it can be hard to know where to start. 

Identifying what you know and don’t know may 

be the best place to start. Using this approach, you may find that you know more than you think 

you know. You may also find areas where you could benefit from a little more information or 

know-how. 

Use the following self-assessment to develop an understanding of your own level of financial 

knowledge, skills, and confidence—your level of financial empowerment. Questions asked in this 

assessment are related to topics in the Your Money, Your Goals toolkit. 

Financial Empowerment 

Financial empowerment involves 

building the ability to use financial 

management knowledge, skills, and 

tools to access resources, products, 

and services to achieve your goals. 

Case manager financial empowerment self-assessment 

As someone who works with clients, it’s important for you to understand your own level of 

financial empowerment. Use this three-part self-assessment to develop an 

understanding of your financial knowledge, skill, and confidence. As you will see in 

the answer keys, the questions asked in this assessment are directly related to modules in the 

Your Money, Your Goals toolkit. 

11 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

 

Case manager self-assessment: Part 1 

Answer each of the following questions by checking either the “true” or “false” column. 

Question True False 

1. Goals are not important to financial planning or budgets. 

2. To have enough money for emergencies you must save 3 to 6 months’ 

worth of living expenses. 

3. A cash flow budget helps you track whether you will have enough cash to 

cover your bills from week to week. 

4. If you can’t pay all of your bills and collectors are calling, the “squeaky 

wheel” that calls you the most should be paid first. 

5. The only way to receive the income you’ve earned from working is by 

receiving a paycheck. 

6. Credit is when you owe someone money. 

7. The amount of your monthly debt payments may impact your ability to pay 

your other bills and living expenses and to access new credit. 

8. A poor credit history may keep you from getting an apartment, insurance in 

some states, or even a job. 

9. There are no risks or additional costs associated with having a checking 

account. 

10. As a consumer, you have almost no rights when it comes to financial 

products. 

Financial empowerment self-assessment: Part 1 results 

Number Correct: ________________ out of 10 

Topics to Learn 

More About: 

12 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

Case Manager Self-Assessment: Part 2 

Use check marks to show which word or phrase (rating) best describes how you feel today. 

Statement Rating 

Does 

not 

apply 

Strongly 

disagree 

Disagree Agree Strongly 

agree 

1. I am satisfied with the amount 

of money I save. 

2. I know about state and federal 

tax credits and how to claim 

them. 

3. I am not concerned about how 

much money I owe. 

4. I am confident about my credit 

reports and scores. 

5. I do not worry about being able 

to pay my monthly living 

expenses. 

6. I understand how credit works. 

7. I know how to fix incorrect 

statements on my credit report. 

8. I feel confident about helping 

clients begin to manage some 

of their financial challenges. 

9. I know where the resources 

are in my community for credit 

and debt counseling and for 

free tax filing assistance. 

10. I know where to get help if I 

have questions about financial 

issues. 

13 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

 

 

 

Case manager self-assessment: Part 3 

Use check marks to show whether your answer to each question is “yes,” “no,” or “I don’t know.” 

Question Answer 

Yes No I don’t 

know 

1. I have a savings or checking account at a bank or credit 

union, and I use this account (make deposits and 

withdrawals regularly). 

2. I have applied for, received, and used a credit card. 

3. I have applied for and received a loan for a car or a 

home. 

4. I have applied for and received a payday loan. 

5. I have requested my own credit report and reviewed it. 

6. I track my income and spending. 

7. I have received a loan from a pawn shop. 

8. I have used the services of a check cashing business. 

9. I have had a car or other type of personal property 

repossessed for nonpayment. 

10. I have received calls from debt collection agencies. 

11. I understand my rights and know what to do if I believe a 

financial services provider has tried to take advantage of 

me. 

12. I receive my earnings from work via a method other than 

a paycheck. (Payroll card, direct deposit, or cash, for 

example.) 

14 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

Case manager self-assessment: Part 1 answer key 

Here are the correct answers for Part 1 of the “Financial Empowerment Self-Assessment.” If you 

did not answer the question correctly, see the module in the toolkit listed next to the answer for 

more information. Reading through the module indicated will help you understand the answer 

to the question and build your financial empowerment knowledge and confidence. 

Questions True False Module 

1. Goals are not important to financial planning or budgets. Module 6 

2. To have enough money for emergencies you must save 

3 to 6 months’ worth of living expenses. Module 7 

3. A cash flow budget helps you track whether you will 

have enough cash to cover your bills from week to 

week. 

Module 10 

4. If you can’t pay all of your bills and collectors are calling, 

the “squeaky wheel” that calls you the most should be 

paid first. 

Module 9 

5. The only way to get the income you earn from working 

is receiving a paycheck. Module 8 

6. Credit is when you owe someone money. Module 12 

7. The amount of your monthly debt payments may impact 

your ability to pay your other bills and living expenses 

and to access new credit. 

Module 11 

8. A poor credit history may keep you from getting an 

apartment, insurance in some states, or even a job. Module 12 

9. There are no risks or additional costs associated with 

having a checking account. Module 13 

10. As a consumer, you have almost no rights when it 

comes to financial products. Module 14 

15 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Case manager self-assessment: Part 2 answer key 

There are no right or wrong answers for Part 2 of the “Financial Empowerment 

Self-Assessment.” That’s because the answers are your opinions about your own financial 

knowledge, feelings, and situation. Use the following chart to count up how many of each answer 

you had: 

Rating Does not 

apply 

Strongly 

disagree 

Disagree Agree Strongly 

agree 

Total for 

each

 Total of strongly disagree + 

disagree: 

Total of agree + strongly 

agree: 

 If the total of agree + strongly agree is greater than the total of strongly disagree + 

disagree, you feel good about many aspects of your financial life. 

 List any that you rated as disagree or strongly disagree below and read the modules 

that relate to these areas in the Your Money, Your Goals toolkit to learn more. 

 If the total of agree + strongly agree is less than the total of strongly disagree + 

disagree, you may be feeling stress about many aspects of your financial life. 

 Consider reviewing the entire toolkit and working through the worksheets on your 

own before you using them with the clients you serve. 

16 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Statement If your rating is disagree or strongly disagree, 

check out . . . 

1. I am satisfied with the amount of 

money I save. Modules 6 and 7 

2. I know about state and federal tax 

credits and how to claim them. Modules 7 and 8 

3. I am not concerned about how 

much money I owe. Modules 10 and 11 

4. I am confident about my credit 

reports and scores. Module 12 

5. I do not worry about being able to 

pay my monthly living expenses. Module 9 and 10 

6. I understand how credit works. Module 12 

7. I know how to fix incorrect 

statements on my credit report. Module 12 

8. I feel confident about helping 

clients begin to manage some of 

their financial challenges. 

Consider reviewing all of the content modules. 

9. I know where the resources are in 

my community for credit and debt 

counseling and for free tax filing 

assistance. 

Supplemental Your Money, Your Goals information on 

making a financial empowerment resource and referral 

guide 

10. I know where to get help if I have 

questions about financial issues. 

Supplemental Your Money, Your Goals information on 

making a financial empowerment resource and referral 

guide 

17 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Case manager self-assessment: Part 3 answer key 

There are no right or wrong answers for Part 3 of the “Financial Empowerment 

Self-Assessment” because it helps you identify the financial products or services with which you 

have had experience. If you have not used some of these products or services that your clients 

may use, you may need to learn more about them. Use the materials in Modules 7, 8, and 9 to 

learn more about products, services, and financial service providers. You may also find it 

beneficial to review those modules even if you have experience with the products, services, and 

financial service providers. 

Question Modules of interest 

1. I have a savings or checking account at a 

bank or credit union, and I use this 

account (make deposits and withdrawals 

regularly). 

If no or I don’t know, see Module 13. 

2. I have applied for, received, and used a 

credit card. If no or I don’t know, see Modules 12, and 13. 

3. I have applied for and received a loan for 

a car or a home. 

If no or I don’t know, see Modules 11, 12, and 

13. 

4. I have applied for and received a payday 

loan. 

If yes or I don’t know, see Modules 10, 11, and 

13. 

5. I have requested my own credit report and 

reviewed it. If no or I don’t know, see Module 12. 

6. I track my income and spending. If no or I don’t know, see Module 8. 

7. I have received a loan from a pawn shop. If yes or I don’t know, see Modules 10, 11, and 

13. 

8. I have used the services of a check 

cashing business. If yes or I don’t know, see Modules 8 and 13. 

9. I have had a car or other type of personal 

property repossessed for nonpayment. If yes or I don’t know, see Modules 10 and 11. 

10. I have received calls from debt collection 

agencies. If yes or I don’t know, see Module 11. 

18 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

11. I understand my rights and know what to 

do if I believe a financial services provider 

has tried to take advantage of me. 

If no or I don’t know, see Module 14. 

12. I receive my earnings from work via a 

method other than a paycheck. (Payroll 

card, direct deposit, or cash, for example.) 

For any response, see Module 7. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

19 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 2: 

Client goal and financial 

situation assessment 

Situation Assessment 

A picture of conditions today used to 

create a plan for actions to change 

conditions in the future. 

 You may be wondering where you should start 

with a client. The Client Goal and Financial 

Situation Assessment may help you figure out a 

beginning point with a client. 

Use of this assessment is optional. It can help you 

efficiently and effectively determine where to 

start in the toolkit, but you may find that you 

already ask similar questions in your existing assessment protocol. 

If you do use this assessment, consider using it when: 

 Clients fill out intake paperwork for your organization or program 

 You meet with clients for an initial assessment 

 Clients are waiting for other services (such as waiting to have their tax returns prepared 

at a Volunteer Income Tax Assistance site) 

You may also choose to: 

 Send this home with clients to fill out privately 

 Use it as a guide to ask questions in a conversational style to better understand the 

financial concerns and goals of your clients 

 Ask the questions over several sessions with your client 

How does it work? When you feel the time is right, you can simply ask a client to complete the 

assessment. You can match her answers with modules in the Your Money, Your Goals toolkit as 

a starting point for assistance. 

21 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Because the assessment is simple and only has a few key questions, you might often be able to 

gather the information in a conversation. Reading the assessment and recording the answers for 

her may be useful if you are working with a client that has limited literacy levels, is an English 

language learner, or with whom a question and answer format would be more productive. 

Introducing the assessment may be uncomfortable if you’re not used to asking these types of 

questions. Module 3 of the Your Money, Your Goals toolkit provides tips on starting the 

conversation. With the assessment, you can use a statement like the following as an 

introduction: 

We know that many issues in running a household involve money. One thing we would like 

to do is provide you with information and tools to help you use your money to reach your 

goals. To get us started, we have this questionnaire, which you’ll see covers several topics. 

You know where you are and where you’d like to go, and your answers will help us build a 

plan to get you the information and tools that are going to be most useful to you right now. 

We will not use the information you provide in any other way. 

Remember, financial empowerment is a big topic. Knowing where to start can be hard, but using 

this assessment will help you identify what is going on with your client and provide her with the 

right information, tools, or referrals. 

Finally, be sure you have a system for keeping your clients’ assessments completely confidential. 

When discussing this assessment with your clients, be sure you can provide assurance of 

confidentiality and describe your system for keeping this information secure (e.g., a locked 

drawer in a file cabinet). As you proceed, be sure to follow your organization’s data policy 

guidelines and retention policy. 

22 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Your goals and financial situation 

Please answer the following questions based on where you are today. There are no right or 

wrong answers. The purpose of this questionnaire to ensure the right financial information and 

resources are provided to you to help you reach your goals. 

Question Response 

1. Do you have financial goals and know how 

much money you need to reach them? Yes No I don’t 

know 

2. Are you in danger of losing your housing or 

car because you cannot make payments? Yes No I don’t 

know 

3. Are you in danger of having any of your 

utilities shut off because of nonpayment? Yes No I don’t 

know 

4. Do you have a regular and reliable source of 

income? Yes No I don’t 

know 

5. Do you have money set aside to cover 

emergencies or unexpected expenses? Yes No I don’t 

know 

6. Are you able to cover all of your bills and 

monthly living expenses each month? Yes No I don’t 

know 

7. Do you owe a person or business money? Yes No I don’t 

know 

8. Do you have student loans or other debts you 

can’t pay? Yes No I don’t 

know 

9. Have you been unable to get a job, cell 

phone plan, insurance, apartment, credit 

card, or car due to a bad credit record? 

Yes No I don’t 

know 

10. Do you have an account at a bank or credit 

union? Yes No I don’t 

know 

11. Have you been denied a savings or checking 

account? Yes No I don’t 

know 

12. Do you feel like the financial services you use 

cost you too much? Yes No I don’t 

know 

23 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
__________________________________________________________________ 

__________________________________________________________________ 

__________________________________________________________________ 

__________________________________________________________________ 

 

 

13. Do you know who to call with a complaint 

about a financial product or service? Yes No I don’t 

know 

14. If you answered that you have financial goals, what are they? 

15. If you could change one thing about your financial situation, what would that be? 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

24 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Client goals and financial situation assessment key 

Use the following chart to help you analyze the “Client Goals and Financial Situation 

Assessment.” This analysis will help you determine where to start financial empowerment work 

with your client. If your client seems to have several high-priority areas, you can list them and 

ask the client to prioritize them with you. 

Question Response 

1. Do you have financial goals and know how 

much money you need to reach them? If no or I don’t know, see Module 6. 

2. Are you in danger of losing your housing or 

car because you cannot make payments? 

If yes, call 211 or local emergency assistance 

center. For homeowners, call (888) 995­

HOPE. 

3. Are you in danger of having any of your 

utilities shut off because of nonpayment? 

If yes, call 211 or local emergency assistance 

center. 

4. Do you have a regular and reliable source of 

income? 

If no, call 211, workforce opportunity center, or 

local emergency assistance center and see 

Module 8. 

5. Do you have money set aside to cover 

emergencies or unexpected expenses? If no or I don’t know, see Modules 7 and 13. 

6. Are you able to cover all of your bills and 

monthly living expenses each month? If no or I don’t know, see Module 10. 

7. Do you owe a person or business money? If yes or I don’t know, see Modules 10, 11, and 

12. 

8. Do you have student loans or other debts you 

can’t pay? If yes or I don’t know, see Modules 9 and 11. 

9. Have you been unable to get a job, cell phone 

plan, insurance, apartment, credit card, or car 

due to a bad credit record? 

If yes or I don’t know, see Module 12. 

10. Do you have an account at a bank or credit 

union? If no or I don’t know, see Module 9. 

25 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

11. Have you been denied a savings or checking 

account? If yes or I don’t know, see Module 13. 

12. Do you feel like the financial services you use 

cost you too much? If yes or I don’t know, see Module 13. 

13. Do you know who to call with a complaint 

about a financial product or service? If no or I don’t know, see Module 14. 

Answers to Questions 14 and 15 will vary. Use the answers to these two questions as additional 

information to help you pinpoint the module and tool that will be most useful for your client 

right now. 

The Consumer Financial Protection Bureau (CFPB) has prepared this material as a resource for the public. This material is provided 

for educational and information purposes only. It is not intended to be a replacement for the guidance or advice of an accountant, 

certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or actions of the 

individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are limited to the 

materials that the CFPB has prepared. 

26 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

MODULE 3: 

Starting the conversation 

Starting the conversation 

If financial empowerment is not a 

part of your regular work with clients, 

knowing when to bring up the topic 

can be a challenge at first. Ways to 

start the conversation include: 

 Using the existing assessment 

tool in intake or assessment 

meetings with clients 

 Making the most of shorter 

discussions you have with 

clients to introduce a tool or 

make a referral 

 Integrating financial 

empowerment into 

organizational programs or 

procedures 

 Following up with clients 

when they bring up financial 

issues directly or indirectly 

Everyone has questions about money. Even the 

wealthiest people in the world may turn to 

someone when they have financial questions. 

It can be difficult, though, to talk about money, 

even with people that you know well. It can feel 

uncomfortable to raise the topic of personal 

finance because it’s so personal. Because the 

subject of money is deeply personal, it can seem 

even more difficult to talk about it with clients 

that you don’t know well. 

But you talk with clients all the time about other 

personal issues. Talking about money can get 

easier if you start the conversation with 

your clients at the right time in a way that 

acknowledges their desire to have control 

over their own lives. By approaching financial 

issues in a non-judgmental way, you will build 

trust that allows you to work with clients to 

address their financial challenges. 

Most people are working to get their financial 

houses in order. But even if you are among the 

few who have never had money struggles 

yourself, chances are that you’ve seen someone 

you care about struggle with financial issues. 

27 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Use the experiences that you’ve had in your own life to help you empathize with your clients and 

understand where they’re coming from. When they feel that you respect them and that they can 

trust you, they will be more willing to open up and discuss financial topics that might otherwise 

make them feel uncomfortable. 

When should I bring up money topics? 

The right time to bring up money topics will depend on the people that you work with and your 

relationship with them. For example, the needs of people transitioning from a shelter into 

permanent housing are very different from the needs of people who own their own homes and 

are at risk of foreclosure. Likewise, discussing money topics will vary depending on how much 

contact you have with your clients. A conversation about financial topics with a client you see 

once a year will be very different than the discussion you’ll have if you see him or her weekly or 

monthly. Like every other intervention, you need to balance meeting clients where they are with 

the expectations of your program. 

If you are screening someone for benefits, follow your organization’s protocol closely when it 

comes to financial questions so that clients don’t feel like you are trying to find out more 

information than is required for screening them. In this case, talking about financial 

empowerment at the wrong time could undermine their trust in you. Instead, you may use this 

opportunity to build trust by suggesting resources they may qualify for such as free tax filing 

assistance or claiming the Earned Income Tax Credit as a way to bring more money into the 

household. 

Clients may also share problems they’re having with a financial product or service provider. As 

you listen to the challenges they’re facing and how they have tried to resolve the problem, if 

appropriate, you can offer to help them submit a complaint to the CFPB. 

28 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
How should I bring up money topics? 

Use the assessment tool 

If you have a lot of contact with a client, one of the easiest ways to bring up money is to use the 

Client Goal and Financial Situation Assessment from Module 2. By going over this series of 

questions with your client, you will have a clear picture of where he or she stands and what 

information might be most useful. Remember, you can: 

 Ask your client to complete the assessment individually either in your office or at home 

 Cover the questions in the assessment orally or in conversation format 

 Ask your clients to complete or answer only a few of the questions 

Make the most of short-term contacts 

While it’s great to be able to build trust and discuss financial issues with your clients over the 

long term, sometimes you just don’t have that kind of time. But that doesn’t mean that you can’t 

work on empowering your clients financially during short-contact meetings, such as when a 

client applies for public benefits or comes in for job skills training. For example, if you had a 

brief meeting with a new client, George, who came in to apply for an energy assistance program, 

you could say: 

29 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
30 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Build it into existing program procedures 

Take a look at your existing organizational purpose, program procedures, and protocols. Often, 

you may find that introducing financial topics, such as credit, debt, savings, and cash flow, help 

clients to become more economically self-sufficient. If economic self-sufficiency or a similarly 

stated purpose is part of your organization’s mission or is required by your funders, can you add 

these topics into your existing protocols, procedures or program offerings to help empower your 

clients financially? 

In the next sections, we’ll offer you specific suggestions, tools, and tips for broadening and 

improving existing financial conversations that you have with your clients. For example, if you 

are working on obtaining employment and building job skills with your client, Javier, you can 

talk with him about banking and savings after he gets a job in order to help him effectively 

manage his income. 

31 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Respond when clients initiate 

Sometimes an opportunity to talk with a client about financial issues will arise outside of a 

formal assessment or procedure. This happens when a client brings up a financial issue directly 

or indirectly. 

Here’s an example of how it could sound if a client brings up a financial issue directly. For 

example, your client, Aaliyah, with whom you have regular and focused contact, says in one of 

your early meetings: 

32 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Here’s an example of how it could sound if a client brings up a financial issue indirectly. For 

example, during a meeting you ask Aaliyah how her kids are doing, and she says: 

Discussing difficulties or problems with financial products with 

your clients 

Many people have difficulty with credit or other financial services, but your clients may feel a 

sense of shame or embarrassment because of their situation. When discussing what has 

happened with your clients, be sure to explain in clear terms how to avoid a similar situation in 

the future and how to get help from the CFPB and other federal, state, or local agencies if they 

can’t resolve problems with the financial services provider. See Module 14: Protecting consumer 

rights for information on submitting a complaint to the CFPB and other authorities. 

Alternatively, you can submit a complaint on behalf of your client. 

Submitting a complaint on behalf of another person 

CFPB’s online complaint system allows you to submit a complaint on behalf of another person 

but the forms and the way in which you submit may vary depending on the type of complaint. To 

submit on behalf of someone else, go to the complaint area of the website. Fill out the first two 

sections—“What happened?” and “Desired Resolution”—and then you will arrive at the “My 

information” section. At the top of the “My information” section in some intake forms, you will 

33 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

be asked whether you are submitting a complaint on behalf of “myself” or “someone else.” 

Choose the “someone else” option and you will be prompted to another section where you can 

fill out the consumer’s contact information. In other forms, you may be able to enter 

information about the contact person that is different from the information provided about the 

consumer. You should upload a copy of the Representation Agreement as an attachment when 

provided an opportunity on the last page of the form. 

This is what one of the online forms looks like with notes for how to complete it for a client: 

34 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Here is what will happen to the complaint: 

 Complaint Submitted: The CFPB will screen you complaint based on several criteria. 

These criteria include whether your complaint falls within the CFPB’s primary 

enforcement authority, whether the complaint is complete, and whether it is a duplicate 

of another complaint you have submitted. 

35 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 Review and Route: If a particular complaint does not involve a product or market that 

is within the Bureau’s jurisdiction or that is not currently being handled by the Bureau, 

the CFPB refers it to the appropriate regulator. Screened complaints are sent via a secure 

web portal to the appropriate company—the business you have the complaint with. 

 Company Response: The company reviews the information, communicates with you 

as needed. It then determines what action to take in response. The company reports back 

to you and the CFPB via the secure “company portal.” After your complaint is sent to the 

company, the company has 15 days to provide a substantive response to you and the 

CFPB. Companies are expected to close all but the most complicated complaints within 

60 days. 

 Consumer Review: CFPB then invites you to review the response and provide 

feedback. Consumer Tracking: You can log onto the secure “consumer portal” available 

on the CFPB’s website or call a toll-free number to receive status updates, provide 

additional information, and review responses provided to the you by the company. 

 Review and Investigate: The CFPB reviews your feedback about company responses, 

using this information along with other information such as the timeliness of the 

company’s response, for example, to help prioritize complaints for investigation. 

 Analyze and report: Complaints help with the CFPB’s work to supervise companies, 

enforce federal consumer financial laws, and write better rules and regulations. The 

CFPB also reports to Congress about the complaints we receive and makes anonymized 

consumer complaint data available to the public on the website: 

www.consumerfinance.gov/complaintdatabase/. 

Contact information 

Online: consumerfinance.gov/complaint 

Toll‐free phone: (855) 411‐CFPB (2372), 8am‐8pm EST, Monday ‐ Friday 

TTY/TDD phone: (855) 729‐CFPB (2372) 

Fax: (855) 237‐2392 

Mail: 

Consumer Financial Protection Bureau 

PO Box 4503, Iowa City, IA 52244 

36 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
The Consumer Financial Protection Bureau (CFPB) has prepared this material as a resource for the public. This material is provided 

for educational and information purposes only. It is not intended to be a replacement for the guidance or advice of an accountant, 

certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or actions of the 

individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are limited to the 

materials that the CFPB has prepared. 

37 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

MODULE 4: 

Emotional and cultural 

influences on financial 

decisions 

Everyone has situations where they know what they think they “should” do, but find themselves 

doing something else instead – especially when it comes to money. For example, you may have 

decided to save part of your tax refund to build an emergency fund. Instead, you use it to help a 

family member pay down his medical debt, because not helping a family member pay off a debt 

would go against the cultural norms you were raised with. Or, you may use it to splurge on 

something you have wanted because you’ve been working hard and making this splurge for 

yourself or family feels good. 

Financial decisions, no matter how well intended, are never made in a vacuum. Many things 

influence both our short- and long-term financial decisions. This module focuses on two 

influences on financial decision-making: emotions and culture. 

Emotional influences on financial decisions 

When people talk about money, it’s not just about the numbers—what they are really discussing 

is what money means to them. Attitudes and behaviors around money are wrapped up in 

feelings around security, failure, family, love, and status. It’s important to observe your clients to 

try to determine their emotional reactions to money and its meaning, and integrate their 

emotions and feelings into your discussions about their finances. If someone is “upset or rattled 

39 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

about money, they tend to swing too far in one direction or the other. The best approach takes a 

middle path – talk to both head and heart.”1 

Instead of just asking your clients to provide you with the basic numbers, try asking your clients 

questions about how they feel when you’re discussing their finances. You could try questions 

such as: 

 “What does money mean to you?” 

 “What is your first memory involving money?” 

 “What is the most difficult thing about money for you? For your family?” 

Helping clients become aware that financial decisions are influenced by emotions and past 

experiences may help them understand what drives some of their financial practices. It can also 

help you better understand their unique strengths and challenges. 

Cultural influences on financial decisions 

No decisions, including financial ones, are made in a vacuum. People make all of their decisions 

within the very powerful context of culture, including family, ethnicity, region, community, 

socio-economic status, generation, and religion. Each of these factors influences beliefs, values, 

and experiences about money and the way financial decisions are handled. 

Cultural influences are heavily rooted in values. Consider how common American values—such 

as individualism, practicality, honesty, and hard work2—might influence the financial choices 

people make. Values around money are also influenced by businesses, governments, changes in 

financial markets, and the media. 

1 Mellan, Olivia and Christie, Sherrie, Second Thoughts: Making Better Decisions, ThinkAdvisor, February 25, 2013. 

See http://www.thinkadvisor.com/2013/02/25/second-thoughts-making-better-decisions. 

2 Kohl, L. Robert, Values Americans Live By, 1984. See 

http://www.claremontmckenna.edu/pages/faculty/alee/extra/American_values.html. 

40 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Cultural conflicts 

Sometimes, you will find that clients are caught in the middle of cultural conflicts around 

money. Their family culture may emphasize saving and avoiding debt, while their broader 

community may ascribe status to material things like new cars or expensive clothes, which could 

require taking on debt to purchase. Or the culture in which they were raised might emphasize 

caring financially for parents as they age, while their peers at work are not expected to take on 

the same level of responsibility. 

Sometimes, these conflicts aren’t just internal, but take place within a family: one spouse may 

have cultural influences or a family background that encourage them to save for their children’s 

education, while the other may feel that children should be responsible for their own 

educational expenses. Consequently, one parent may want to save the family’s tax refund; the 

other will think that money should go towards things the family needs or simply wants now. 

These conflicts can lead to emotional decisions that may not look rational on the outside but 

make perfect sense given their background, values, and culture. 

How can this understanding help my 

clients? 

Discover your clients’ cultural and emotional context 

When discussing clients’ financial behavior, don’t just accept their expressed wants at face 

value; probe gently to discover their underlying attitudes, needs, goals, and roadblocks. Ask 

them questions like: 

 “Who handles the finances in your family?” 

 “How does your community of faith view money?” 

 “How did your family handle finances when you were growing up? Did you discuss 

money openly?” 

 “How do your friends view money? How do you think this may influence you?” 

41 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 “What do you want your children to learn about money? What do you think they are 

learning from you now?” 

It’s often difficult for people to open up about money, but taking the time to really understand 

and connect with your clients’ cultural and emotional values and needs around money will build 

empathy, making you more successful in achieving both client and program outcomes. 

Recognize emotional and cultural influences 

An example of how a difference in cultural values might affect financial behavior is that Western 

culture values individuality and personal well-being, which means it’s generally considered 

appropriate for each person to support themselves financially. In some other cultures, family 

members support each other financially throughout their lives—if they save money, it may go to 

a family member they believe needs it. If a client chooses to spend his disposable income on his 

extended family instead of saving it in an emergency fund, this doesn’t mean that he has bad 

financial habits, just that he is making financial choices in a different cultural context than you 

may be familiar with. 

Helping to bridge cultural and emotional roadblocks 

It’s important to understand these cultural influences without being judgmental. In discussing 

financial goals and choices with clients, seek to understand their values and cultural influences, 

so that you can help them reach their true goals in a way that makes them feel understood and 

respected. Though they might agree to a financial plan that makes rational sense, and know that 

it’s what they have agreed to do, this is often not enough to override their feelings or cultural 

context in the moment when decisions are made. Remember that while their priorities may 

seem counterproductive to you, within their own culture, they may feel completely appropriate. 

Once you understand the cultural factors that are guiding your clients’ behavior, you can coach 

them toward financial choices that help them effectively manage their obligations and line up 

with their true values and desires. This might mean that you help them figure out a compromise: 

for example, how to ensure that they take responsibility for their own financial needs and 

obligations without asking them to abandon their commitment to help their extended family. 

The Consumer Financial Protection Bureau (CFPB) has prepared this material as a resource for the public. This material is provided 

for educational and information purposes only. It is not intended to be a replacement for the guidance or advice of an accountant, 

certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or actions of the 

individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are limited to the 

materials that the CFPB has prepared. 

42 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
MODULE 5: 

Using the toolkit 

How does it work? 

At this point you may be wondering: How am I ever going to find the time to add financial 

empowerment into my already packed schedule? One way to think about this financial 

empowerment work is that it is not an “add-on” service, but rather something to be integrated 

into the work you are already doing with clients. 

Does this mean that it doesn’t require time on your part? Of course not. But that time will be 

front-loaded. In order to integrate financial empowerment into the case management or other 

supportive services you provide, you will have to invest time into: 

 Learning the toolkit content 

 Becoming comfortable with the topics and the tools in the toolkit 

 Thinking about ways to introduce financial empowerment in the context of the case 

management you provide 

 Potentially capturing the outcomes of financial empowerment in the work you do 

43 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Integration 

Integration of financial empowerment means identifying where and how you can weave 

financial empowerment information and tools into the work you are already doing. 

Why is integration of financial empowerment such a promising strategy? Here are a few 

reasons: 

 It builds on established relationships you may have with clients. 

 Clients are busy—there is efficiency in addressing many issues in one stop. 

 Financial and economic issues cut across situations and challenges: basic needs 

housing, health and health care, child rearing and care, work, transportation, and 

so on. 

 Financial empowerment integration may present a more holistic approach to 

working with clients. 

 It provides opportunities for reinforcement during “natural” discussions with 

clients. 

 It may result in better outcomes for the clients and programs.3 

This module provides you with a tool to get you started: the Client Financial Empowerment 

Checklist. The purpose of this tool is to provide you with a tracking template for use with each 

client you provide financial empowerment services to. It’s meant to be a simple way to keep 

track of the tools or information you have shared with a particular client as you integrate 

financial empowerment into the work you are already doing with clients. It can also be used to 

share output level data with your organization and as a case management tool to connect one 

meeting with a client to the next. 

3 Giuffrida, Inger, Integrating Financial Education into the Work that You Do, April 2010. 

44 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Tool 1: 

Client financial empowerment 

checklist 

This financial empowerment checklist can help you: 

 Identify the financial empowerment information and tools to share with your clients 

 Keep track of the information you have shared including any referrals you have made for 

a client 

The checklist is organized by financial empowerment topic or module with each tool associated 

with that module following. The question(s) following each module name can help you identify 

the financial empowerment problem addressed in the module and through the tools. 

The goal is not to cover all of the tools with each client, but rather to find the right 

module or tools given the client’s most pressing financial empowerment problem 

or the area in which they have expressed an interest to get more help. 

Use this checklist as follows: 

 Print a copy of the checklist for each client. 

 Write the client’s name on the checklist. 

 When you have covered the topic or tool, put a check next to the tool or write in the date. 

 Use the notes section if you are working with a client on an ongoing basis. Include 

information about your discussion, specific challenges, and whether you made a referral. 

 Keep the checklist with the file so each time you work with the client, you can check in on 

their financial empowerment progress. 

45 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Client Name: ____________________________________________ 

or 

date 

Tool Notes and referral information 

Module 6: Setting goals—Does the client have clear goals? Is the client satisfied with his or her 

financial situation? 

Goal setting tool 

Module 7: Saving for emergencies, the unexpected, and goals—Does the client have money set 

aside for emergencies or unexpected expenses?

 Savings plan 

Benefits and asset limits 

Finding a safe place for 

savings 

Module 8: Managing income and benefits—Does the client have enough income? 

Income and financial 

resource tracker 

Strategies for increasing 

sources of cash and 

financial resources 

Cash, paychecks, direct 

deposit, payroll cards, and 

EBT— understanding the 

pros and cons 

Increasing your income 

through tax credits 

Module 9: Paying bills and other expenses—Does the client pay bills on time each month?

 Spending tracker 

 Bill calendar 

Strategies for cutting 

expenses 

46 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
When cash is short: 

prioritizing bills and 

spending 

Module 10: Managing cash flow—Is the client able to make ends meet each month? 

Cash flow budget 

Cash flow calendar 

 Improving cash flow 

checklist 

Module 11: Dealing with debt—Is the client able to manage his or her debts?

 Debt management 

worksheet 

 Debt-to-income worksheet 

Debt reduction strategies 

worksheet 

Module 12: Understanding credit reports and scores—Has the client ever reviewed his or her credit 

report? 

Getting your credit reports 

and scores 

Credit report review 

checklist

 Improving credit reports 

and scores 

Module 13: Evaluating financial service providers, products, and services—Has the client considered 

using different financial products or services to manage income and pay expenses?

 Selecting financial 

products and providers 

 Evaluating financial 

service providers 

47 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Basic definitions of 

financial services 

Opening an account 

checklist 

Module 14: Protecting consumer rights—Does the client know about basic steps to be protected from 

scams, cons, fraud, and identity theft? If the client has a question or a problem with a financial 

product or service, does he or she know how to contact the CFPB?

 Red flags 

Protecting your identity 

Learning more about 

consumer protection 

Filing a complaint 

This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

48 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

MODULE 6: 

Setting goals 

Every person or family has a different idea of the future they want to build. Some of the ideas 

they have are focused on the next few months, and others are long-term. What do you want for 

yourself and your family in the near future? What do you want to see in the next few years? 

But people sometimes hesitate to set goals because they feel like their life is out of control and 

that they can’t change the direction they’re going. 

One way to think about financial empowerment is to begin by thinking about your goals. Once 

you know where you are now and where you’d like to go, that can help you take the first step in 

the direction you’ve chosen. 

If you’re like most people, you’ll need money to achieve some of your goals. Your goals may 

include, for example, having enough money to pay all of your bills each month, or having 

enough money to pay off a short-term loan from a family member or lender. Your goals could 

also include saving money to buy gifts at holiday time, set up an emergency fund, purchase a 

used car, move to a nicer apartment, make a repair on your home, send your child to college, pay 

for education for yourself, or put into a retirement account. 

To start the process, ask yourself how you would like your life to be different. Ask yourself what 

you really want most from life, too. 

This process of figuring out where you want to go in life and knowing what you want to achieve 

for yourself or for your family is called setting goals. As you know, depending on the goal, it can 

take just a week, a month, or a few months to reach some goals. These are short-term goals. You 

may also have long-term goals—things that will take many months or even years to reach. 

Setting goals is a powerful process for thinking through your short-term and long-term future 

and finding ways to turn your vision into reality. It helps you turn your needs, wants, hopes, and 

dreams for the future into something concrete that you can take steps to achieve. 

49 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Setting goals helps you to: 

 Work toward making your future better 

 Prioritize how you spend your money so that it goes toward things that really matter to 

you 

 Measure and track your progress toward getting the things you want out of life 

 Take pride in bettering your life and the lives of your children 

Setting SMART goals 

SMART goals have five important characteristics. They are specific, measurable, able to be 

reached, relevant, and time bound. When setting a new goal, think about the following: 

Ask yourself: Who will achieve or benefit from the goal? What is 

specifically being achieved? Why is the goal important? Is this goal related 

Specific	 to covering the expenses associated with an expected life event? 

A specific goal has a much greater chance of being met than a general, 

because it provides something defined to reach for.
 

Ask yourself: How much? How many? How will I know when it is done? Measurable 

You should be able to track your progress toward meeting the goal. 

Ask yourself: Is this goal something that I can actually reach?
 

You might want to get out of high credit card debt tomorrow or become a Able to be 

millionaire in a year, but for most of us, those are totally impossible goals. reached 

That doesn’t mean that your goals should be easy. Your goal may be a 

stretch for you, but it should not be extreme or impossible. 

Ask yourself: Is this something that I really want? Is now the right time to 

Relevant do this? 

Set goals that matter to you and are a priority in your life. 

50 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Ask yourself: By what date must this goal be reached? 

Goals should have a clearly defined time frame, including a target or 

Timebound deadline date. This helps ensure they are measureable (Did I achieve the 

goal by the target date?) and that actions are planned to reach the goal by 

the date. 

Here are some hopes, wants, or dreams you might have for your family and how they could be 

translated into strong goals. 

Hopes, wants, or dreams Strong goals 

I’d like to be able to pay all of my bills each 

month. 

Short-term goal: I will review my budget to see if 

there are ways to cut my spending by the end of the 

month. 

Short-term goal: I will meet with the Community 

Action Program to see if I qualify for job training and 

other benefits by the end of the month. 

I really want to save some money in case 

something happens in the future and I lose 

my job. 

I will save $50 over the next six months to start an

emergency fund. 

I want to get out of credit card debt. I will pay down $1,000 of my debt over the next 18 

months. 

I’d like a safe, stable place to raise my 

children. 

Short-term goal: I will save $800 for the required 

first month rent in the next six months so that I can 

move into a new apartment by June. 

Long-term goal: I will save $3,000 for a down 

payment, apply for additional down payment help, 

and purchase a home in four years. 

I’d like to buy a new television. I will save $400 and purchase a new television in six 

months. 

Short-term goal: I will read to my child every night to 

I’d like to help my child go to college. show that school and learning are important. 

Long-term goal: I will save $5000 in a fund to help 

pay my child’s tuition in ten years. 

51 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Turning goals into savings targets 

For goals that require money to reach, you will want to know: How much should I save every 

week (or month) to meet my goal? 

When figuring out how much you need to save every week to meet your goal, you need two 

pieces of information: the total amount that you’d like to save and the number of weeks you have 

to save. Then, you can plug those two pieces of information into this formula: 

Total amount 

needed for goal 

Number of 

weeks to reach 

goal 

Amount to set 

aside each 

week 

Here is an example: It is January 1st, and you’ve just set a new goal to save $500 in an 

Emergency Fund by the time your kids start school at the end of August. You already have your 

first piece of information: the total amount you’d like to save is $500. To get the second piece of 

information, the number of months, just count the number of months from January to August 

and multiply by 4. You should arrive at 32 (8 months X 4 weeks). 

You can plug these numbers into the formula: 

$500 ÷ 32 = $15.65 (rounded) 

The formula shows that you would need to save about $15.65 every week in order to have $500 

by the time your kids start school. (To get the monthly total, divide the savings goal by 8 months 

instead of 32 weeks.) 

Here is another example: It’s the beginning of May and your new goal is to save $500 to buy new 

school shoes, clothing, and school supplies for your kids at the end of August. How much do you 

need to save every week to meet this goal? Your first piece of information is that you need a total 

of $500. To find the number of weeks you have to save, count the months from May until August 

and multiply by 4. You have 16 weeks. Now, plug it in to the formula: 

$500 ÷ 16 = $31.25 per week 

You would need to save $31.25 per week (or $125.00 a month) in order to meet this goal. 

52 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

After doing these examples, did you notice how the three pieces of information (total amount of 

savings, number of weeks, and amount needed to save every month) are related to each other? 

Though the amount of total savings is the same in both, you’d need to save more each week in 

the second example, because you have fewer weeks to save. This relationship is a good rule to 

remember. 

If you shorten your length of saving time (like from 32 weeks to 16 weeks), but keep your money 

goal the same ($500), you will need to increase the amount of savings per week (from $15.65 to 

$31.25) to reach your goal. 

It’s helpful to use this formula when figuring out if your goal is actually reachable. For example, 

in September you decide to buy a new television by the end of November. You’ve looked at 

models, and the one you want is $600. If you start saving at the beginning of September, you 

have twelve weeks to save. You can plug this into the formula to see how much you’d need to 

save each month. 

$600 ÷ 12 = $50 per week 

You would need to save $50 every week (or $200 every month) in order to meet this goal. But 

what if you don’t have $50 extra dollars in your cash flow budget? Does that mean buying a new 

television is a bad goal? 

No – it just means you need to make an adjustment to either the amount of savings or to the 

length of time you have to save so that the goal is attainable. Are you willing to buy a less 

expensive television? Here is an example of adjusting your goal and purchasing a less expensive 

($300) television: 

$300 ÷ 12 = $25 per week 

By lowering the total amount of savings to $300, you bring your monthly weekly savings to $25, 

which might fit more easily into your cash flow budget. But if you don’t want to buy a less 

expensive television, what else could you do to make this goal attainable? You can decide to 

lengthen the savings period. Instead of saving for three months, you extend the time to six 

months or 24 weeks to save for the television: 

$600 ÷ 24= $25 per week 

By giving yourself 24 weeks to save instead of 12, you can bring your weekly savings down to $25 

and purchase your desired television in February instead of November. 

53 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Once you have your savings goal, be sure to add it into your budget or cash flow budget. For 

more information on cash flow budgets, see Module 10: Managing cash flow. For ideas on 

finding money to save for your goals, see Module 7: Saving for the unexpected, emergencies, 

and goals. 

What about revising goals? 

Goals aren’t something to set and then forget. You need to keep your goals in sight, and you may 

sometimes need to revise them when: 

 The goal has been achieved 

 The amount of saving every week or month toward the goal exceeds what makes sense 

for your family 

 Emergency savings are used and need to be replenished 

 Your circumstances change (such as when you lose a job or get a new job, start earning 

more money, have a new child, have a health emergency, etc.) 

 Your values change and a goal no longer feels relevant 

To revise one of your goals, take a look at what has changed. 

If one of your goals has been achieved, it’s time to start the process again and set a new goal. 

Think about what you want for yourself and your family and create a new goal. 

If the amount of saving every week or month toward the goal exceeds what is possible for you, 

think about if you can change either the length of time you have to save or the total savings. Ask 

yourself if this goal can wait a bit longer. If it can, adjust the length of time you have to save, 

which will bring down the amount of your weekly or monthly savings. If you can’t adjust the 

length of time, you can lower the amount of total savings, which will also bring down the 

amount of your weekly or monthly savings. 

If your Emergency Savings have been used, they’ve done their job. Now it’s time to replenish 

them. Create a new goal by figuring out how much Emergency Savings you’d like to have and by 

when. Calculate the amount you need to save weekly or monthly and start saving. (See Module 

7: Saving for the unexpected, emergencies, and goals for more information on this topic.) 

54 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

When your circumstances change (such as when you lose a job or get a new job, start earning 

more money, receive a lump sum from a tax refund or inheritance, have a new child, have a 

health emergency, etc.), take stock of your new situation and your goals. If you have less money 

to put toward savings goals, adjust the length of time and/or the total savings for your goals to 

make them manageable in your new situation. For example, if you get a tax refund, consider 

putting some of the lump sum toward one of your goals. This may help you reach the total you 

need for a goal faster. 

When your values change and a goal no longer feels relevant, think about what you want for 

your family in the future. If the goal you set before no longer feels relevant to your life, set it 

aside and begin setting new goals that do feel relevant. 

Savings accounts for children 

Clients who want to teach their children about saving may be able to start a savings 

account for their children. Each financial institution has its own policies, so research both 

local and online bank and credit union options. 

What are the benefits of opening a savings account for a child? 

 Providing a safe place for a child to put money earned or received as gifts 

 Introducing a child to saving and using financial services 

 Helping a child to build assets and learn to plan for the future 

Saving for education 

Clients with children may want to work toward making a better life for their children. Saving for 

children’s postsecondary education or training may be a financial goal for these clients, because 

they see them as a path to “a better life.” 

Postsecondary education, which means training or education after completion of high school, 

can be an important investment of both time and money. Training and education after high 

school graduation (including completion of a General Education Development test or GED) is 

55 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

likely to lead to higher wages on average, less chance of unemployment, and a greater chance for 

financial security. 

FIGURE 1: MEDIAN WEEKLY EARNINGS, 2012 

$­

 $500

 $1,000

 $1,500

 $2,000 

Source: Bureau of Labor Statistics, Employment Projections. Education Pays..., accessed April 2014. See 

http://www.bls.gov/emp/ep_chart_001.htm. 

Saving for children’s education can help pay for the costs associated with training and education 

after high school. These savings can also reduce the amount of money that must be borrowed 

and may increase the number of options children have for schooling after high school. 

There are many financial products geared toward helping people save for children’s education, 

but the first step is setting a goal and setting aside money specifically for it. Once someone has 

done this, he can save for postsecondary education in a savings account, a certificate of deposit, 

or an investment option designed specifically to help people save for postsecondary education. 

One option is a 529 college savings plan. These are tax-advantaged savings plans designed to 

help parents, guardians, and grandparents save for children’s education. For more information 

on saving for college using a 529 Plan, visit http://www.collegesavings.org. 

56 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 1: 

Goal setting tool 

This tool can help you with the goal-setting process. Why are goals important? Identifying goals 

helps you plan for and reach what is most important to you. And when it comes to your finances, 

goals provide the direction for all of your plans. If you don’t plan to save for your goals, you 

probably won’t. And in order to save for your goals, you have to know how much money you’ll 

need and by when. 

There are three steps in the goal-setting process: 

 Step 1: Brainstorm a list of the hopes, wants, and dreams for yourself or your family. 

Determine whether they are short-term or long-term. Write these in the chart below. 

 Step 2: Turn your hopes, needs, wants, and dreams into SMART goals using the second 

worksheet. 

 Step 3: Finally, figure out how much you need to save each week (or month) to reach 

your goal using the final section of the worksheet. 

If you decide to make a budget or a cash flow budget (See Module 10), be sure to 

add in your monthly savings goals. 

Step 1: Brainstorm list of hopes, wants, and dreams 

Fill in the chart below by listing the hopes, wants, and dreams you have for yourself and your 

family. Write the things you hope, want, or dream about achieving in less than six months in the 

short-term column. Write the things you hope, want, and dream about achieving in more than 

six months in the long-term column. 

57 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Short-term Long-term 

What I want to achieve for myself or my family What I want to achieve for myself or my family 

within six months. that will take more than six months. 

Step 2: SMART goals 

Use the list of brainstormed hopes, wants, and dreams to create SMART goals. Use the checklist 

to make sure your goals specific, measurable, able to be achieved, relevant, and time bound. 

You may have many things you want to achieve. If you can focus on one or two, you may have a 

better chance of reaching that goal. (If you want to write more than one short-term goal and one 

long-term goal, make another copy of the worksheet for this step.) 

Short-term goal 

Goal:  Specific 

 Measurable 

 Able to be reached 

 Relevant (important to you) 

 Time bound (is there a 

deadline?) 

Long-term goal 

Goal:  Specific 

 Measurable 

 Able to be reached 

 Relevant (important to you) 

 Time bound (is there a 

deadline?) 

58 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Step 3: Figure out weekly savings target 

Use the chart below to figure out how much you need to save for those goals that need money. 

Start with the goals you circled above and then calculate your monthly savings goal. Note: To 

figure out an estimated weekly goal, divide your “monthly savings goal” by 4. 

Goals Amount 

needed 

Number of weeks to 

deadline 

Amount needed ÷ 

Number of weeks to 

deadline = Weekly 

savings goal 

Short-Term 

Example: I will save $50 

within 6 months to start an 

emergency savings fund. 

$50 24 weeks $50 ÷ 24 = $2 per week 

(about $8 per month) 

Goal: 

Long-Term 

Goal: 

Once you have your savings goal, be sure to add it into your budget or cash flow budget. For 

more information on cash flow budgets, see Module 10: Managing cash flow. For ideas on 

finding money to save, see Module 7: Saving for the unexpected, emergencies, and goals. 

Resources 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/complaint 

59 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed 

60 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

MODULE 7: 

Saving for the unexpected, 

emergencies, and goals 

What is savings? 

Savings is money you set aside today to use in the future. People save for many reasons. Two big 

reasons they save are for: 

 Unexpected expenses and emergencies 

 Their own goals, like a new TV, appliances, a home, their children’s education, and 

retirement 

Why save for unexpected expenses and emergencies? Because they will happen. 

Everyone has unexpected expenses and emergencies—this could be a suddenly needed car 

repair, the need to travel to help a sick family member in another state, a cutback in hours or 

even the loss of a job. 

When you save for unexpected expenses and emergencies in advance, you can handle them 

when they happen without having to skip paying your other bills or borrow money. Saving will 

help you save the additional costs of being late on bills or borrowing to cover those extra costs 

that can make it harder to reach your goals. 

When you skip paying other bills to pay for an emergency, you often pay late fees. And if it 

results in loss of service (your utilities are shut off, for example), then you have to come up with 

more money to turn them back on. 

When you borrow money, you have to pay fees and sometimes interest. And on top of that, you 

will have to use some of your income going forward to pay back the money you borrow. 

61 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Borrowing money to cover unexpected expenses and emergencies both costs you more and uses 

up some of your income every month until you have paid back the money. So saving money now 

for unexpected expenses and emergencies can save you money later. 

How to save 

Anyone who has tried to save knows that setting money aside isn’t as easy as it sounds. First, 

you have to make the decision to save. Then you also have to find the money to save. There are 

basically only two ways to find money to save: 

 You can decrease spending on one item or many things. Then, put that money 

“not spent” into savings. The easiest way to find a chunk of money to save is to eliminate 

one major cost. This may mean cutting back on television services (from premium cable 

service to basic), phone service (from unlimited texts and calling to a limited or prepaid 

plan), or on a service you’re paying for but may not be using. 

If there are not “major costs” to cut, you may have to cut back a little bit in several 

different categories of spending—cutting out one meal out per month, for example, or 

consolidating errands to spend less on gasoline. 

But the big challenge is turning that “money saved” into savings. You have to move that 

money you have saved by not spending it into a savings jar or envelope in your home and 

then into a savings account at a bank or credit union or a savings bond. If you don’t have 

a place to set it aside, it can be easy to spend it instead of save it. 

 You can also increase your income. This can mean taking another part-time job or 

ensuring you file your taxes and claim tax credits you qualify for. For example, your tax 

refund can be saved for emergencies or unexpected expenses, set aside for annual 

expenses (back to school or holiday shopping), used to pay down debts, used to take care 

of car repairs, or set aside for household maintenance. Again, you must make sure that 

some of that new income gets moved into the place you have decided to save it. You can 

use Tool 1: Savings plan to figure out why you need to save, how much you need to save, 

and how you can start to find the money to save. Tool 4: Increasing your income 

through tax credits explains the Earned Income Tax Credit (EITC) and the Child Tax 

Credit and how they can help you increase the income you have available to pay bills, pay 

down debt, or save for your goals. 

62 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Savings and public benefits 

If you are receiving public benefits, you may want to know about asset limits. Asset limits are 

rules about how much you can have in assets before your benefits are reduced or eliminated. 

Different benefits have different limits. 

Assets are things you own that have value. Your money in a savings or checking account is an 

asset. A car, home, business inventory, and land are examples of assets, too. 

Assets help you build financial security for you and your family. But if you receive public 

benefits, some of your assets may affect the benefits you receive. Generally, the assets 

that may be counted when applying for benefits are “liquid”—money in checking accounts, 

savings account, and investment account are examples of liquid assets. If you own your own 

home or a car, these assets will generally not count against qualifying for benefits. 

You can use Tool 2: Benefits and asset limits to understand the asset limits of the benefits you 

receive. This can help you save without unexpectedly losing your benefits. 

Savings plan 

Did you know that most people in the U.S. don’t have enough savings to cover a $1,000 

emergency?4 Whether you have low income or high income, most people can expect around 

$2,000 worth of unexpected or emergency expenses in a year.5 These unexpected expenses 

include medical bills that aren’t covered by insurance, auto repairs, home and appliance repairs, 

and bills that you still have to pay if you lose your job are the most common. For individuals 

with fluctuating or seasonal income, the amount of money needed to cover weeks or months 

when the income is less than expected or nonexistent will be even greater than the $2,000 for 

unexpected or emergency expenses. 

4 Dickler, Jessica, Most Americans can’t afford $1000 in emergency expenses, CNN Money, August 11, 2011. See 

http://money.cnn.com/2011/08/10/pf/emergency_fund. 

5 Consumer Federation of America. See http://www.consumerfed.org. 

63 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

What is a savings plan? A savings plan is a plan that includes: 

 The reasons you are saving. This could include your goals, setting up an emergency 

fund, money to pay for your automobile insurance in three months, money to cover the 

months you are likely to be laid off due to seasonal availability of work, or to ensure you 

have enough money set aside for back to school expenses. 

 The amounts you need to save. This is the total amount of money you need to save. 

You do not need to save this all at once. Your savings plan will help you come up with an 

amount of money you can save each and every month to reach all of your savings goals.6 

 How you are going to find that money to save. These are the specific strategies 

you are going to use to find that money to save. Most people do not have unused income. 

They have to make choices about cutting back on one expense (or more) to afford 

something else. Or they have to figure out a way to get more income. Another strategy is 

using direct deposit or transfer of a set amount into a savings account if you have a 

regular paycheck. Tool 4: Increasing your income through tax credits explains the 

Earned Income Tax Credit (EITC) and the Child Tax Credit and how they can help you 

save for your goals. 

 Where you are going to put that savings. You have to work hard to save money. 

You want to make sure you put it in a safe and secure place. An important part of your 

savings plan is identifying specifically where you will put the money you have saved. 

6 While the target amount for an emergency fund will vary from person to person based on their needs, $500 to 

$1,000 has been suggested as a starting point. See http://www.AmericaSaves.org. 

64 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Emergency fund 

An emergency fund or a rainy day fund can be an important part of your savings plan. 

Having your own money set aside to cover unexpected expenses can save you money, 

because you won’t pay interest, fees, or other costs that come from borrowing the money 

you need. 

How much should you save? Start with $500 as your goal. This is enough to cover a lot of 

common emergencies: many car repairs, a plane ticket to care for a sick family member, 

or to pay minor medical costs. 

Once you reach $500, consider reaching for $1,000. This may be enough to cover your 

rent if you lose your job, take care of major car repairs, and pay for many household 

repairs. 

What are the benefits of a savings plan? 

 Your plan builds your own personal safety net one paycheck at a time. 

 As you build savings, you can have peace of mind knowing you have a little set aside for 

the unexpected or emergencies. 

 As you watch small amounts add up, you’ll move closer to reaching your goals and 

almost always pay less than when you use credit and rent-to-own. 

 And, you’ll save money by avoiding late fees, interest charges, and other costs related to 

not covering expenses or borrowing money. And when you avoid borrowing, you don’t 

have to commit future income to paying off your debt. 

Here is an example scenario using different options for taking care of emergency expenses. The 

example examines the costs of paying for an unexpected expense with emergency savings, a 

credit card, or a payday loan. 

65 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

COST TO REPLACE SPARK PLUGS ON YOUR AUTOMOBILE = $350. 

Emergency 

savings Credit card Payday loan 

Amount $350 $350 $350 

APR7 21.99% annual percentage rate 

(APR) 

$15 for every $100 borrowed for 14 days. 

This means a 391% annual percentage 

rate (APR).8 

Payment 

Must pay at least a certain 

amount each month.9 (For the 

purposes of the example, the 

individual is choosing a fixed 

monthly payment of $50.) 

Must pay back loan amount ($350) plus 

fee ($52.50) within 14 days. If entire loan 

cannot be paid within 14 days, it can be 

rolled over (or extended) for another 14 

days for an additional fee of ($52.50).10 

Total 

cost and 

time to 

repay 

$0 

You would pay $28.11 in interest 

in addition to the principal 

borrowed. It will take just over 

eight months11 to pay back the 

full amount. 

The total cost depends on how long it 

takes you to save up to pay back the 

entire loan. If you renew or roll over this 

loan seven times, you would be in debt 

for 14 additional weeks and could pay up 

to $367.50 in fees.12 

7 These are for example purposes only. Actual credit card and payday loan terms vary, and some states restrict payday 

loans. The CFPB notes that, APRs on credit cards can range from about 12 percent to 30 percent. For payday loans, 

the CFPB notes that the cost of the loan (finance charge) may range from $10 to $30 for every $100 borrowed. A 

typical two-week payday loan with a $15 per $100 fee equates to an APR of almost 400%. See CFPB, What is a 

payday loan? November 6, 2013. See http://www.consumerfinance.gov/askcfpb/1567/what-payday-loan.html. 

8 Some states have adopted laws that limit the amount of loan above a certain amount and/or limit the interest rates 

of these loans. 

9 Most credit card companies allow customers to pay a percentage of the amount owed, which makes the minimum 

payment vary from month to month. For the purposes of this example, we are showing a fixed monthly payment. 

10 These numbers and terms are for example purposes only. Actual costs and terms of payday or signature loans will 

vary. See Consumer Financial Protection Bureau, Payday Loans and Deposit Advance Products: A White Paper of 

Initial Data Findings, April 24, 2013. See http://files.consumerfinance.gov/f/201304_cfpb_payday-dapwhitepaper.pdf. 

11 To pay off this credit card balance in full, the individual will have to make $50 payments for seven months, and 

then pay just over $28 in the eighth month. 

12 Two–thirds of repeat payday borrowers take more than seven loans in one year. Consumer Financial Protection 

Bureau, Payday Loans and Deposit Advance Products. 

66 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
A safe place to save 

Setting aside money to save can be hard and it’s important to understand the risks and the 

benefits of each of the places you can put the money until you want or need to use it. As you 

consider the options, you’ll want to make sure to be aware of the potential costs of each financial 

product. 

Tool 3: Finding a safe place to save can help you identify where you’d like to keep your savings. 

Federal insurance for financial institutions 

There are two agencies established by the federal 

government to make certain that the money people 

deposit in banks or credit unions will be there when 

the person wants to withdraw it. The Federal 

Deposit Insurance Corporation (FDIC) insures 

money in banks. The National Credit Union 

Administration (NCUA) insures money in credit 

unions. 

In general, the limit is $250,000 per depositor, per 

insured institution. So, if you have no more than 

$250,000 in a savings account in an insured bank 

and the bank fails, you will get all your money back. 

The FDIC and NCUA do NOT insure money that 

people use to invest in stocks, mutual funds, life 

insurance policies, annuities, or other securities, 

even if they are purchased from a bank or credit 

union. 

How will you know if deposits in a bank or credit union are insured? You can look for these 

FDIC or NCUA logos. These will be on the door, displayed on the bank or credit unions websites, 

or on all materials from the bank or credit union. 

67 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Direct deposit and savings 

If you receive a regular paycheck, one way to build savings is through direct deposit into a bank 

account or onto a payroll card. 

 Using direct deposit saves you both time and money. You don’t have to get your 

check cashed to use it. And the funds are generally available as soon as they are 

deposited. That means you get paid on time, even if you aren’t working on payday and 

that you get paid at the start of the payday, not the end of the day. 

 If you have a bank account, you can arrange to have some of the money 

deposited moved automatically to a savings account. If your weekly paycheck of 

$245 is directly deposited into your checking account every week, you can have $10 

automatically transferred into a savings account. Once you set this system up, you may 

forget about that $10. And by the end of the year, you will have over $500 in that 

account. 

If your employer allows you to split your direct deposit, consider putting some of your paycheck 

into savings and the rest into your checking account for your bills and other expenses. Some 

payroll cards have a savings or “purse” feature. This feature lets you set aside some of your 

paycheck on the card for savings. You will need to find out the specific features and fees of the 

payroll card offered through your employer. 

Check with your employer to learn more about direct deposit. 

Your banking history report 

If you are considering opening a savings account, it’s important to understand the impact that 

your banking history report may have on the type of account you may be able to open. The 

information below can help you learn more and take action to correct any mistakes in your 

report. 

When you complete the application to open an account at a bank or credit union, the bank or 

credit union often contacts specialty consumer reporting agencies that have information on 

checking account history. Banks and credit unions contact companies like ChexSystems, 

TeleCheck, Early Warning, and others like them to find out if you have had prior difficulties 

using a checking account, including writing bad checks or suspected fraud. 

68 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

These agencies collect information about how consumers manage savings and checking 

accounts. They do this for financial institutions that are a part of their network. Financial 

institutions use the information to assess the risk of opening an account for a specific person 

based on his or her past history of managing similar accounts. 

The report includes information about the accounts that have been reported (routing transit 

number and/or account number), date information was reported about an account, and then the 

reason for the report. The report also includes retail information, which refers to returned 

checks. Retailers and other businesses report this type of information to SCAN (Shared Check 

Authorization Network). 

If you are denied a checking account based in whole or in part on a report from any of these 

specialty consumer reporting agencies, you have the right to a free disclosure of certain 

information in your file from the agency. The notice you receive from the bank or credit union 

will give you the name, address, and phone number of the consumer reporting company and 

how you can contact it to obtain your free disclosure. 

If you find mistakes, you can dispute these by sending a letter (you may use regular or certified 

mail) describing the mistake and including copies of any evidence. 

You can order your own free ChexSystems report online at www.consumerdebit.com, call for 

more information at (800) 428-9623, or send a written request to: Chex Systems, Inc., 7805 

Hudson Road, Suite 100, Woodbury, MN 55125. 

You can request your annual file disclosure from TeleCheck Services by calling (800) 366-2425. 

You can order your TeleCheck Services Report by sending a written request and include a 

daytime phone number, a copy of your driver’s license, your social security number, and a copy 

of a voided check to: TeleCheck Services, Inc., Attention: Consumer Resolution – FA, P.O. Box 

4514, Houston, TX 77210-4515. 

To request your Early Warning report, call (800) 325-7775. 

69 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

 

Tool 1: 

Savings plan 

This tool can help you make a plan to save money for your goals, expenses, and unexpected 

expenses and emergencies. 

There are two steps to making a savings plan. First, answer the set of questions below to see if 

setting up an emergency fund or rainy day fund may be right for you. If yes, complete the 

savings plan using the worksheet. To complete this worksheet, you will need to know: 

 Your savings goals. If you haven’t set these, consider using the information and tools in 

Module 6: Setting goals. 

 Strategies you can use for saving money. The worksheet encourages you to be as specific 

as possible. See the example in the worksheet to get started. 

 Where you will put the money you save. 

Answer the following questions to see if setting up an emergency fund or rainy day fund may be 

right for you and your family. 

Goals: Do you have the savings needed to reach your goals? Yes No 

Expenses: Do you have money set aside for expenses that come one to 

four times per year? 

For example, automobile insurance, renter’s insurance, back to school 

expenses, birthdays, holidays (gifts, special food, etc.) 

Yes No 

Unexpected expenses and emergencies: Do you have money set aside 

for unexpected expenses or emergencies? 

For example, a flat tire or other car trouble, medical expenses, need a new 

appliance, job loss 

Yes No 

Living expenses for months no income or income that is less than 

expected: Do you have money set aside to cover your living expenses 

during the months you will be earning little or no income? 

Yes No 

71 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
If you answered no to any of these questions, developing a savings plan may be a great next step 

for you. 

For questions above to which you answered “no,” how do you pay for goals, expenses that come 

one to four times per year, and unexpected expenses and emergencies? Check all that apply to 

you. 

____ I don’t know. It just seems to work out. 

____ I don’t pay other bills to cover the emergency or unexpected expense. 

____ I borrow money from other family members or friends. 

____ I get a payday loan. 

____ I get cash through a pawn shop. 

____ I use a credit card. 

____ I use a refund anticipation loan (RAL). 

____ I use my tax refund. 

____ I use a car title loan. 

72 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

Savings plan13 

Name _________________________________________ Date ______ 

Savings 

goal 

Total 

amount 

needed 

Months 

to reach 

goal 

Monthly 

amount 

to save 

Strategies for saving 

Amount 

saved 

per

month 

Safe and 

secure 

place for

savings 

Example: To 

save $1,000 

in an 

emergency 

fund within 

10 months. 

$1,000 10 $100 

Cut back to basic cable $40 Savings 

account 

at a bank 

or credit 

union. 

Will 

generally 

require a 

minimum 

deposit 

Cut out one fast food meal 

per week for family $60 

Total saved per month $100 

Once you have your savings plan, be sure to add it into your budget or cash flow budget. For 

more information on cash flow budgets, see Module 10: Managing cash flow. For more 

information on setting up an account to save in, see Module 13: Evaluating financial service 

providers, products, and services. 

13 This table refers to a monthly savings plan. The training also emphasizes irregular savings deposits as well from 

such places such as Federal and State EITC returns. An example could include depositing $200 of a $2,000 EITC 

return. 

73 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer need 

74 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Tool 2: 

Benefits and asset limits 

Asset limits and savings 

Even if you receive public benefits, 

you can generally have some savings. 

Savings are important for building 

your financial stability. Knowing your 

state’s asset limits can help you make 

a savings plan. 

If you are receiving public benefits, you may want 

to complete this tool to know how your savings 

might affect your benefits. 

Assets are things you own that have value. Your 

money in a savings or checking account is an 

asset. A car, home, business inventory, and land 

are examples of assets, too. 

Assets help you build financial security for you 

and your family. But if you receive public 

benefits, some of your assets may affect the benefits you receive. Generally, the assets that may 

be counted when applying for benefits are “liquid”— money in checking accounts, savings 

account, and investment accounts are examples of liquid assets. If you own your own home or a 

car, these assets will generally not count against qualifying for benefits. 

If you have saved money from the Earned Income Tax Credit, this savings is not counted against 

your limit for up to 12 months. 

Do you receive public benefits? Yes No 

For example, food stamps (SNAP), cash assistance (TANF), 

Supplemental Security Income (SSI), Medicaid, etc. 

If you answered “yes” to the question above, you may want to review the following tool with your 

case manager. 

It is important to note that some benefits are federal, and some benefits come from the state. Be 

sure you find out the rules that apply to the benefits you get in your own state. 

75 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Your case manager will share with you a completed copy of this chart. Please note that rules 

regarding benefits change regularly, so check this annually to ensure accuracy. 

Benefit14,15 Do you 

have this? Asset limits Contact and other 

information 

SNAP16 

Supplemental 

Nutrition Program, 

also called Food 

Stamps 

Up to $2,000 in countable 

resources (bank account) or 

$3,250 if one household 

member is over 60 or 

disabled17 

States using broad-based 

categorical eligibility have no 

asset limits.18,19 

TANF - Temporary 

Assistance for Needy 

Families 

$2,000 to $3,000 in most 

states 

SSI - Supplemental 

Security Income 

$2,000 if single 

$3,000 if married 

14 This information is current as of January 2013 and pertains to rules for 2012. 

15 United States Department of Agriculture Food and Nutrition Service. See http://www.fns.usda.gov/snap/eligibility. 

16 In general, only your liquid assets – like cash or money in savings or checking account – are counted. This means 

that you may still eligible to receive benefits even if you own a home or, sometimes, a car. Whether an asset counts 

against the limit depends on the program and the state. 

17 Certain resources are NOT counted, such as a home and lot, the resources of people who receive Supplemental 

Security Income (SSI), the resources of people who receive Temporary Assistance for Needy Families (TANF, 

formerly AFDC), and most retirement (pension) plans. The procedures for handling vehicles are determined at the 

state level. See United States Department of Agriculture Food and Nutrition Service, 

http://www.fns.usda.gov/snap/eligibility. 

18 States have had the option to enroll people using broad-based categorical eligibility. This effectively eliminates the 

asset test specifically for SNAP because people are enrolled based on their enrollment in other programs. See 

http://www.fas.org/sgp/crs/misc/R42054.pdf. 

19 United States Department of Agriculture Food and Nutrition Service. See 

http://origin.www.fns.usda.gov/snap/rules/Memo/BBCE.pdf. 

76 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

Benefit14,15 Do you 

have this? Asset limits Contact and other 

information 

SSDI 

Social Security 

Disability Insurance 

No asset limits 

Rental assistance 

Energy Assistance 

Family Medicaid20 

No asset limit test due to 

Affordable Care Act 

Regulations that took effect 

in 2014 

State Child Health 

Insurance Program 

No asset limit test in most 

states; contact state 

administrator for details. 

Other: 

This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

20 See https://www.federalregister.gov/articles/2012/03/23/2012-6560/medicaid-program-eligiblity-changesunder-the-affordable-care-act-of-2010#h-28. 

77 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 3: 

Finding a safe place for 

savings 

Setting money aside can be hard. It often means you have to cut back on spending somewhere 

else. For example, you may have given up premium cable or satellite dish service for basic. Or, 

you have found a way to bring in more income – you’ve taken on a part-time job, or you received 

a tax refund. 

Once you have set money aside, you need to find a safe place to store that money. For some 

people, a secret place in their home may feel like a safe place. For other people, it may be an 

account in a bank or credit union. 

If you do not know where to put your money or want to make sure the place you have chosen is 

safe, use the following tool. Think about the benefits and risks of each option. There are some 

benefits and risks of each option listed already to get you started. 

Safe place 

to keep 

your 

money 

Benefits Risks Other important 

information 

A secret 

place in 

your home 

No costs for maintaining 

it 

Easy to access 

Convenient 

Can be lost, stolen or 

destroyed in a fire or natural 

disaster 

Might put you at risk of a 

home invasion crime 

With a 

family 

member or 

friend 

No costs for maintaining 

it 

Can be lost, stolen or 

destroyed in a fire or natural 

disaster 

Might put your friend or 

family member at risk of a 

home invasion crime 

79 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Safe place 

to keep 

your 

money 

Benefits Risks Other important 

information 

On a 

prepaid 

debit card 

(stored 

value card) 

Easy to access 

Convenient 

No account needed 

May have fees for activation, 

loading funds, using the 

card, etc. 

May not be insured for you or 

have the same protections 

from loss or theft as a 

savings account if the card or 

PIN are lost or stolen. 

Check the card 

agreement to ensure 

that you understand 

the fees and whether 

you have protection 

from loss or theft. 

In a 

federally 

insured 

savings or 

checking 

account 

If the institution is 

federally insured, up to 

$250,000 per depositor 

is protected. 

Unlike cash, the money 

cannot be lost, stolen, or 

destroyed in a fire or 

other disaster. 

You can generally get it 

back if someone steals it 

by stealing your ATM or 

debit card. 

May be charged fees if you 

do not follow the rules for the 

account 

You may not be able 

to open an account for 

a period of time if you 

have had an account 

closed because of 

unpaid account fees 

and debts in the last 

five years. 

Be sure you 

understand any 

monthly fees and other 

fees. 

U.S. 

Savings 

Bonds 

The money cannot be 

lost or destroyed in a fire 

or other disaster. If you 

have a paper bond, the 

funds can be recovered 

The rate is guaranteed 

for the length of the 

bond. 

You lose some of the interest 

if you cash the bond before it 

matures. 

Other 

Based on this information, the best place for me to keep my savings is: ________. 

80 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

81 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 4: 

Increasing your income 

through tax credits 

Tax credits can make a big difference. They may give you a refund that can be saved for 

emergencies or unexpected expenses, set aside for annual expenses (back to school or holiday 

shopping), used to pay down debts, and more. The Earned Income Tax Credit (EITC) is a benefit 

for working people who have low- to moderate-income. Your tax refund is based on your income 

and filing status. 

For the 2013 tax year the following income limits and maximum tax credits apply: 

Household size 

Income limit if filing as 

single or married filing 

separately 

Income limit if married 

filing jointly Maximum tax credit 

Three or more 

qualifying children $46,227 $51,567 $6,044 

Two qualifying 

children $43,038 $48,378 $5,372 

One qualifying child $37,870 $43,210 $3,250 

No qualifying children $14,340 $19,680 $487 

Also, investment income must be $3,300 or less for the year. 

83 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Your kids are “qualifying children” if: 

 They have lived with you in the U.S. with you (or your spouse if married filing jointly) for 

more than half of the year; 

 Are under age 19 or under age 24 if they are a full-time student or are “permanently and 

totally disabled;” and 

 Are related to you: your son, daughter, stepchild, eligible foster child, brother (including 

step or half), sister (including step or half) or are a descendant of any of these. 

If you do not have any qualifying children, you may still be entitled to the credit if you are 

between ages 25 and 65, live in the U.S. for half of the year, and do not qualify as a dependent 

for anyone else. 

There is also a Child Tax Credit, which reduces the taxes you owe. If the amount of your Child 

Tax Credit is greater than the amount of income tax you owe, you may be able to claim the 

Additional Child Tax Credit. The Child Tax Credit phases out if your adjusted gross income 

exceeds the following: 

 $110,000 if married filing jointly 

 $75,000 if single, head of household, or qualifying widower 

 $55,000 if married filing separately 

This information changes every year. To make sure you have the most current 

information, visit: http://www.irs.gov/Individuals/EITC-Income-Limits,-Maximum-Credit-­

Amounts-and-Tax-Law-Updates. 

More information on the Child Tax Credit is available here: http://www.irs.gov/uac/Ten-Factsabout-the-Child-Tax-Credit. 

Be sure to visit a Volunteer Income Tax Assistance (VITA) Program to file your taxes and make a 

plan to use your tax refund. The volunteers are trained by the IRS, and getting your taxes done 

doesn’t cost you anything. This preserves your income. This can make a big difference in your 

ability to start and fund your savings and in your life. Find one at 

http://irs.treasury.gov/freetaxprep or call (800) 906-9887. 

84 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Resources 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/complaint 

The CFPB has prepared this material as a resource for the public. This material is provided for educational and information 

purposes only. It is not a replacement for the guidance or advice of an accountant, certified financial advisor, or otherwise qualified 

professional. The CFPB is not responsible for the advice or actions of the individuals or entities from which you received the CFPB 

educational materials. The CFPB’s educational efforts are limited to the materials that CFPB has prepared. 

85 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

 

MODULE 8: 

Managing income and 

benefits 

Income 

Income is the money that comes into your household. You use income to pay for the things you 

need and want. You get income from part- or full-time work, self-employment, and investments. 

You can also get income in the form of gifts from others, tax refunds, or even inheritance. 

Income can be regular—this means it comes into your household on a schedule and in an 

amount that you can count on. Or it can be irregular—this means you cannot predict 

accurately when you will receive it or how much you will receive. These ups and downs can make 

it hard to be sure that you’ll have money to pay your bills and have enough on hand for expenses 

like food and transportation. 

Sometimes income is seasonal—you may receive it for only some months out of the year. For 

example, if you work in the building industry, you may be very busy with work from March 

through November, but not working at all from December through February, especially if you 

live in a northern state. Finally, income may be a one-time occurrence. Your tax refund is an 

example of a one-time source of income within a year. 

Managing income can be very challenging if it is irregular, seasonal, or one-time-only, because 

you may not know how much money is coming in or when it will be coming in. Your bills and 

expenses, however, continue. For example, even if your income does not come in, your rent will 

still be due every month. 

It can also be hard to use irregular, seasonal, or one-time income to cover expenses in the 

months you may not have income. When you have the money, you may need or want to spend it 

rather than setting it aside for bills and expenses in other months. 

87 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

You can use Tool 1: Income tracker to figure out if your income is regular, irregular, seasonal, or 

one-time within a year. It is the first step in planning how you can manage your income 

differently to cover spending in months you may not have income. This is also an important step 

in creating a cash flow budget, which is explained in Module 10: Managing cash flow. 

If you find that your income is less than you need or want, you can use Tool 2: Strategies for 

increasing income and resources. 

Benefits 

Benefits are payments from local, state, or federal government. They are designed to help 

individuals and families that do not have the resources to cover their basic living expenses. 

You can only get benefits if you apply for them. And then, you will only receive them if you 

qualify for them. For most benefits programs, eligibility is based on: 

 Income 

 Circumstances – whether you have dependents or have a disability, for example 

 Assets – savings, a vehicle (or more than one vehicle), money in investments, for 

example
 

Benefits are like income in that they can be used to pay for some of the things you need. The 

difference between income and benefits is that benefits may often only be used for a specific 

purpose. For example, if you qualify for the Supplemental Nutrition Assistance Program 

(SNAP), you can only use those benefits to purchase groceries. If you qualify for Medicaid, you 

can only use those benefits to cover qualified health expenses. 

Benefits are important financial resources that cover living expenses. That’s why it is important 

to track benefits the same way you keep track of your income. Having benefits can also free up 

cash to pay for other living expenses not generally covered by benefits, such as: 

 Utilities 

 Gasoline for an automobile 

 Car repairs 

88 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Cell phone service 

 Debt repayment 

In some states, people receive their unemployment benefits and other government benefits on a 

prepaid card.21 Instead of getting checks, they receive a card, and each month the benefit 

amount is loaded onto the card. These government benefit cards are sometimes called Electronic 

Benefit Transfer (EBT) cards. 

The federal government also provides prepaid cards for receipt of certain federal benefits, such 

as veterans’ benefits or Social Security benefits. In most cases, you can also choose direct deposit 

to a checking or savings account or a prepaid card of your choice. 

If your EBT card is lost or stolen, be sure to call to report it lost or stolen right away—the 

number you call will depend on the issuing agency. If someone else uses the card and PIN 

number, there is chance these benefits will not be replaced. 

The amount you can be charged in fees for using the card depends on the contract between the 

government agency and the financial institution providing the card account. Be sure to read the 

cardholder’s agreement carefully before using the card. 

One major advantage of both EBT cards and direct deposit to a checking account or prepaid card 

for benefits is that individuals do not have to go anywhere to pick up benefits each month. 

Benefits are automatically transferred to the household’s account or card each month on a 

specific date. 

Getting income 

There are different ways to receive income and benefits. In some situations, you do not have a 

choice. For example, some public benefits you must receive using EBT where benefits are 

directly deposited to a card or a bank account. Some employers may only pay you using a 

traditional paycheck. You may get your income in one or more of the following ways: 

 Cash 

21 Some states also distribute child support via prepaid card. 

89 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 Personal check 

 Paycheck 

 Direct deposit (to a checking or savings account or prepaid card) 

 Payroll card (prepaid card arranged by employer) 

 Electronic benefits transfer (EBT) 

Why does this matter? Each way to get income has advantages and disadvantages. Some of these 

advantages and disadvantages may make it easier or harder for you to manage your income. To 

better understand the pros and cons of each method, use Tool 3: Cash, paychecks, direct 

deposit, payroll cards, and EBT—understanding the pros and cons. 

After you have you have tracked your income, be sure to add it into your budget or cash flow 

budget. For more information on cash flow budgets, see Module 10: Managing cash flow. 

Garnishments 

There are two kinds of garnishment: 

 Wage garnishment—your earnings are garnished or attached to pay for a debt 

 Nonwage garnishment—money in a bank account is attached or garnished to pay for 

a debt 

Wage garnishments give the government or creditors the right to collect money directly out 

of someone’s paycheck. This can generally only happen with a court order. 

Common reasons for wage and nonwage garnishment are: 

 Taxes owed to the IRS or the state 

 Money owed for child support 

 Money owed for delinquent student loans 

 Other unpaid or delinquent debts such as credit card or medical debt 

90 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

With a wage garnishment order, only a certain percentage of the employees disposable earning 

can be withheld. Title III of the Consumer Credit Protection Act details the limits the wage 

garnishments. Generally, the amount must be the lesser of two figures: 

 25% of disposable income 

or 

 The amount that a person earns each week over the federal minimum wage ($7.25) times 

30 ($7.25 X 30 = $217.50). (Note that the federal minimum wage is subject to change. 

See http://www.dol.gov for updates.) 

All mandatory deductions are protected from garnishment outright: 

 Federal, state and local taxes 

 FICA contributions 

Voluntary deductions are not protected. 

Some states have additional protections. Find a legal aid organization in your community to 

learn more about protections from wage garnishment. 

All income and money in an account is available for garnishment unless you receive it from a 

protected income source: 

 Social Security Payments 

 Supplemental Security Income 

 Veteran’s Benefits 

 Railroad Retirement Board Benefits 

 Federal Employee and Civil Service Retirement Benefits 

If you owe money for federal taxes, child support, or federal student loans, even protected 

income sources can be garnished. If you owe state or federal debt, no court order is needed to 

attach your bank account. 

91 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 1: 

Income and financial 

resource tracker 

Income is the money that comes into your household. Benefits are financial resources that come 

into your household. 

Use this tool to track all of income and financial resources that you receive during a month. 

Identify whether the income is: 

 Regular—comes at a predictable time during the month 

 Irregular—is not predictable 

 Seasonal—is only received during some months during the year 

 One-time—only comes one-time or once a year (a gift or tax refund, for example) 

You can track either gross income or net income. It is easier to track net income, however. This 

is the money you actually have to use to pay for your living expenses. 

This will help you understand the money and financial resources you have to work with and is 

an important step in creating your cash flow budget, which can be found in Module 10: 

Managing Your Cash Flow. 

93 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Income for the Month of: ______________________________________________ 

On this worksheet, enter net income you have earned in each category. 

 Add each column to get weekly income totals. Add the total for each week to get the monthly total. 

 Get a total by source by adding each row.  Put a check in the column that best describes the income: regular, irregular, seasonal, or one time. 

Week 1 __/__/__ 

Week 2 __/__/__ 

Week 3 __/__/__ 

Week 4 __/__/__ 

Total by source 

Regular Irregular Sea

Job S

econd job 

Self- employment Income S

N

AP 

T

A

NF 

S

SI 

S

S

DI 

Childcare payment 

94 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Week 1 

__/__/__ 

Week 2 __/__/__ 

Week 3 __/__/__ 

Week 4 __/__/__ 

Total by source 

Regular Irregular Sea

Child support 

Gift 

Tax refund 

Other 

Weekly total 

Once you have tracked your income, be sure to add it into your budget or cash flow budget. For more informatio

budgets, see Module 10: Managing cash flow. For more information on financial services that may help you ma

see Module 13: Evaluating financial service providers, products, and services. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for the public. This materi

and information purposes only. It is not a replacement for the guidance or advice of an accountant, certified financial advisor, or otherwise qualified profe

responsible for the advice or actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts that CFPB has prepared. This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you or the organization us

responsible and has no control over how others may use the information that you provide to them about your personal or financial situation. Be cautious hrecommends that you do not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that and financial information; and shred hard copies that contain sensitive personal and financial information when no longer needed 

95 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 2: 

Strategies for increasing 

sources of cash and financial 

resources 

If you feel like you may not have enough income and other financial resources to pay for all of 

your needs and wants, you can do one of two things: 

1. Increase your sources of cash, income, or other financial resources. 

2. Decrease your spending or uses of cash and other financial resources. 

This tool focuses on ways to increase sources of cash and financial resources. 

Before you use the tool, you should note that there are two ways to bring in more income. You 

can sometimes bring in more income through a one-time activity. This would include selling 

items in a garage sale or on sales websites. This would also include getting a tax refund by 

claiming tax credits for which you qualify. 

You can sometimes bring in more income on a regular basis. This would include getting a parttime job, applying for benefits for which you qualify, or starting a small business. 

Use the tool to identify ways you can increase your income. Note that not all of these may apply 

to you. Check those that may be an option for you, and use this as a plan for getting more 

information or resources. 

97 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

if 

option for 

you 

Strategy for increasing sources of cash 

and financial resources 

Information or resources you 

need to access this information 

One-time activity 

Hold a yard sale/garage sale 

Sell items online 

Claim tax credits 

Other: 

Regular income 

Seek a raise or additional hours at current job 

Seek opportunities for training or education 

that would increase wage at current job 

Change tax withholding (if you generally 

receive a large tax refund.) 

Get a part-time job 

Do odd jobs (providing childcare, doing yard 

work, running errands for someone, etc.) 

Rent a room in your home 

Start a part-time small business or use your 

talents or hobbies to make items to sell 

online 

If you qualify, apply for public benefits (TANF, 

SNAP, Medicaid, public housing) 

Search the Internet for reputable 

opportunities to provide services to other 

businesses 

Other:

 Other: 

98 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Once you have identified strategies for increasing income, adjust your cash flow—see Module 

10: Managing cash flow. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

99 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 3: 

Cash, paychecks, direct 

deposit, payroll cards, and 

EBT—understanding the 

benefits and risks 

Salaries, wages, and public benefits can be provided in a variety of ways: cash, paychecks, direct 

deposit, payroll cards and electronic benefits transfer (EBT) cards. Each has potential pros and 

cons related to convenience, security, and fees. 

The table below highlights some of the pros and cons associated with each method in order to 

help you make an informed decision about how to receive income and benefits. 

*Note that the availability of EBT cards—and the fees and other details regarding their use—vary 

from state to state and from program to program. 

101 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Definition Benefits Risks 

Cash 

Paper or coin money 

minted by the U.S. 

Government 

Accepted everywhere 

Not subject to garnishment 

or other collection 

Could be lost or stolen 

Some people find it 

tempting to spend cash 

they have on hand (i.e. 

“burns a hole in your 

pocket”). 

Can be more difficult to 

track for personal 

budgeting and tax 

purposes 

Not all bill payments can be 

made in cash 

 This is a good option for me. Ways to get more information: 

 This is not a good option for me. 

Paychecks 

A check for salary or 

wages made out to an 

employee 

Income can be deposited 

to a checking or a savings 

account or onto a prepaid 

card. 

If you do not have a bank 

account, some banks and 

credit unions do not charge 

a fee to cash “on us” 

checks that are written 

from accounts that are held 

with their institution. 

Otherwise, you will have to 

pay a check cashing 

service to cash them. 

Bank and credit union 

accounts are sometimes 

the only cost-free way to 

cash paychecks. 

If you don’t have an 

account, unless your 

employer’s bank or credit 

union cashes “on us” 

checks for free, you may 

have to pay a check 

cashing service to cash 

them. 

If you deposit a paycheck 

in a bank or credit union 

account or onto a prepaid 

card, you may not be able 

to access all the funds 

immediately. 

 This is a good option for me. Ways to get more information: 

 This is not a good option for me. 

102 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Direct 

deposit 

Employee pay is 

electronically routed to 

your bank or credit 

union account or your 

own prepaid card 

without the use of a 

paper check. 

Safer and more secure 

than carrying cash or 

checks 

Funds are usually available 

immediately. 

Reduces trips to bank 

Funds can be accessed via 

a debit card, ATM card, or 

personal checks. 

If the direct deposit is made 

to a checking account, the 

account’s debit card has 

full consumer protections 

for funds taken by error or 

theft. 

Income can be routed to a 

bank or credit union 

account. 

Many employers allow you 

to split your deposit 

between a checking and 

savings account, which can 

help you build savings. 

No check cashing fees 

If direct deposit is made to 

a prepaid card, the card 

may lack full consumer 

protections for funds taken 

by error or theft. 

Potential overdraft fees if 

employee writes checks or 

uses debit card without 

sufficient funds 

Requires some extra effort 

to access cash when cash 

is needed 

May not be offered by all 

employers 

 This is a good option for me. Ways to get more information: 

 This is not a good option for me. 

Payroll 

cards 

Prepaid cards arranged 

by an employer through 

which employees 

access their salary or 

wages 

Safer and more secure 

than carrying cash or 

checks 

The payroll card has full 

consumer protections for 

funds taken by error or 

theft. 

Potential inactivity and 

service fees 

Potential overdraft fees if 

employee uses card 

without sufficient funds 

Requires some extra effort 

to access cash when cash 

is needed 

 This is a good option for me. Ways to get more information: 

 This is not a good option for me. 

103 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Electronic 

benefit 

transfer 

(EBT) card 

EBT cards replace 

paper-based benefits 

for programs such as 

Temporary Assistance 

to Needy Families 

(TANF), Supplemental 

Nutrition Assistance 

Program (SNAP), 

Women, Infants, and 

Children (WIC) 

program, and other 

programs.22 

Safer and more secure 

than carrying cash or 

checks 

Looks like a debit or credit 

card 

Not all merchants accept 

EBT cards. 

Some EBT cards are 

subject to fees. 

Certain cards lack full 

consumer protections for 

returning funds taken by 

error or theft. 

 This is a good option for me. Ways to get more information: 

 This is not a good option for me. 

22 The availability of EBT cards—and the fees and other details regarding their use—vary from state to state and from 

program to program. 

104 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Resources 

For MyMoney.gov budgeting resources, visit: 

http://www.mymoney.gov/Fast/Pages/Results.aspx?k=Budgeting%20worksheets&s=All 

If you lose your job, visit the following for more information: 

http://www.benefits.gov/ 

http://www.dol.gov/ebsa/publications/joblosstoolkit.html 

If you are in a natural disaster, visit the following for more information: 

http://www.fema.gov/disaster-survivor-assistance 

If you have a medical emergency you cannot afford, visit your state department of health 

and human services listed here: 

http://www.hhs.gov/recovery/statewebsites.html 

If you would like help managing your debt or rebuilding credit, visit the National 

Foundation for Credit Counseling: 

http://www.nfcc.org 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/Complaint 

The CFPB has prepared this material as a resource for the public. This material is provided for educational and information 

purposes only. It is not a replacement for the guidance or advice of an accountant, certified financial advisor, or otherwise qualified 

professional. The CFPB is not responsible for the advice or actions of the individuals or entities from which you received the CFPB 

educational materials. The CFPB’s educational efforts are limited to the materials that CFPB has prepared. 

105 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

106 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

MODULE 9: 

Paying bills and other 

expenses 

Needs, wants, and obligations 

Needs, wants, and obligations are all 

things you spend money on. But, 

what are the differences among 

needs, wants, and obligations? Needs 

are something you must have to live. 

Wants are things you can survive 

without. Obligations are things you 

must pay because you owe someone 

money (a car loan) or have been 

ordered to pay someone (child 

support). 

This can be a struggle for many people. For some 

people, there is never enough income to cover 

their needs, wants, and obligations. For others, 

balancing their personal priorities and their 

cultural expectations can create a challenge. 

The general guideline for financial health is to 

spend less than you earn. But, if your earnings do 

not cover even very basic living expenses, this rule 

of thumb may not seem very helpful. 

No matter what your situation, it is important to 

start by understanding the differences among 

needs, obligations, and wants. 

Needs are those things you must have to 

live. Shelter and utilities, food, clothing, and 

transportation are examples of needs. The difficulty with needs, however, is that there is a wide 

range of options for shelter and utilities, food, clothing, and transportation. Determining what 

you can afford to get and to maintain or sustain can be a challenge with respect to needs. 

Obligations are those things you must pay because you owe money or have been 

ordered to pay someone money. Debts are examples of obligations. Child support, alimony, 

and judgments are also examples of obligations. 

Wants are the things you can survive without. For example, while a reliable car to get to 

work is a need, a new car with expensive features is both a need and a want. 

107 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Separating out needs, obligations, and wants can be challenging because what one person may 

view as a want, another person may see as a need. Financial empowerment is about providing 

people with options and letting them make choices for themselves. Being able to separate needs, 

obligations, and wants for yourself empowers you to cut back on those areas you determine are 

optional in your life. 

To get a clear picture of how you use your money and financial resources now, use the Tool 1: 

Spending tracker, to get started. Many people who track their spending for a week or a month 

discover that they are spending money in small ways that add up and sometimes don’t match 

their priorities. Once they track their spending, they’re better able to make decisions about 

which bills and expenses can be reduced. 

If you are trying to make ends meet or find money to save, you may also want to cut back on the 

money and financial resources going to bills and living expenses. When this is the case, the key 

is to identify which bills and expenses can be cut. For specific ideas on cutting back on uses of 

money and financial resources, use Tool 3: Strategies for reducing expenses. 

Paying bills 

Many people have recurring obligations—rent, utilities, car payments, child support payments, 

and insurance payments are examples of these obligations. You may avoid late fees and other 

consequences of late or nonpayment if you can: 

 Inventory the bills you have 

 Set up a bill paying calendar so you can visually see when payments are due 

Tool 2: Bill calendar was designed to help you document what you owe and when it is due. You 

could also explore reminder services for bills as well as apps. These are designed to send 

reminders when bills are due and should be paid. Another part of bill payment is how bills are 

paid. In general, you can pay your bills using: 

 Cash 

 Money orders 

 Checks 

108 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Credit cards 

 Automatic debit 

 Online bill payment 

With information about the advantages and disadvantages of each method of bill payment, you 

can be empowered to make different choices—choices that may help you: 

 Save time 

 Save money 

 Avoid additional or unnecessary fees 

 Create a reliable record of bill payment 

Bill payment 

method Advantages Disadvantages 

Cash 

Easy to understand. 

Often no additional costs associated 

with cash such as buying a special 

product (money order) or overdraft 

fees (checking account). 

May be inconvenient as this requires 

in-person payment of bills. 

Fees may be charged for cash 

payments made through a bill-payment 

service. 

May be difficult to prove payment 

unless you have a receipt. 

Cost of traveling to the businesses you 

are paying money to. 

Cash can be lost or stolen. 

Money order 

Easy to understand. 

Can be mailed, so more convenient 

than cash. 

Can be safer than a check in some 

cases, as no personal banking 

information appears on the money 

order. 

May be inconvenient because you 

have to purchase the money order. 

Cost per money order. 

May be difficult to prove payment 

unless you have the money order 

receipt and receive a receipt for 

payment. 

Costs of mailing the payments. 

109 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Check 

Convenient once the checking 

account is set up at a bank or credit 

union. 

Can be mailed, so more convenient 

than cash. 

Easier to prove payment should a 

dispute arise. 

Option for online bill payment through 

the bank or credit union. 

Funds in checking account are safe. 

Requires an account at bank or credit 

union; you may not be able to get a 

checking account if you have a 

negative banking history report. 

The bank or credit union may charge 

nonsufficient fund fees, overdraft 

charges, or returned check fees if you 

pay bills by check without enough 

money in your account. 

May be difficult for some people to 

understand and manage a checking 

account. 

Time to write out checks and mail 

them. 

Costs of mailing the bills. 

Credit cards 

Convenient. 

Can pay bills over the phone or 

online. 

Easier to prove payment should a 

dispute arise. 

Credit card protections. 

Can be set up to automatically pay 

recurring bills with no risk of 

overdraft. 

Creates debt—you are borrowing 

money to pay for bills and other items. 

Costs more than paying for the 

purchase with cash or a check if you 

can’t pay the credit card balance in full 

and have to pay interest on the 

balance. 

Automatic debit 

Convenient.
 

No chance of being late—set it up 

once and forget it. 

Can be linked to a debit card 

(checking account) or credit card.
 

Easier to prove payment should a 

dispute arise.
 

Saves time. 

If set up for automatic debit (payment) 

from a checking or savings account, 

you could run the risk of the debit 

occurring when there is not enough 

money in the account to cover the 

transaction. You would then have to 

pay additional fees. 

110 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Online bill 

payment 

Convenient. 

You may have the option to automate 

outgoing payments or manually make 

the payments using your bank or 

credit union’s online banking portal. 

Minimizes chances of being late if 

bills are set up for automatic 

payment. 

If set up through your bank or credit 

union, you may receive warnings or 

alerts if you do not have enough 

money in your account to pay a bill. 

May include options for setting up 

payment from cell phones/smart 

devices. 

Saves time. 

Takes time to set up and learn. 

Possible risks of overdraft. 

When cash is short: Prioritizing bills 

Even when you cut spending, you may still find yourself to be short on cash. 

But when you’re trying to decide which of your obligations to pay first and bill collectors are 

calling, it can sometimes seem easiest to just pay the “squeakiest wheel.” 

You are responsible for paying all of your obligations on time. But when you have cut out 

everything that is not a “need” and truly do not have enough money to cover your obligations 

and living expenses, you may have to make a short-term plan to get through the month. 

Sometimes this may involve paying some bills late. Sometimes it may mean missing a bill. This 

can be an extremely stressful situation, but it requires careful, clear-headed thinking. Part of 

making this short-term plan involves understanding the consequences of delaying paying 

certain bills. And sometimes it means ignoring that squeaky wheel for a short period of time 

until you can build a plan for repayment. 

For example, what are the potential consequences of the following scenarios? 

111 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Action Some potential consequences 

Five days past the due date for 

your rent 

Pay the late fine as outlined in your lease agreement. 

Risk creating a pattern of late payment, which could lead to 

eviction–the landlord terminating your tenancy through the 

courts. 

Strain your relationship with your landlord. 

Create stress for you. 

Miss a credit card payment 

Pay the late fee as outlined in your credit card agreement. 

Risk an increase in your interest rate (if you are 60 days late). 

Get a negative entry on your credit reports. 

Risk a drop in your credit scores. 

Miss your car payment 

Pay the late fee as outlined in your loan agreement.
 

Risk creating a pattern of late payment, which could lead to 

repossession of your car. 

Create a situation in which you need more cash the following 

month—to catch up the car payment you missed.
 

Get a negative entry on your credit reports.
 

Risk a drop in your credit scores.
 

Miss your electric bill payment 

Pay the late fee. 

Create a situation in which you need more cash the following 

month—to catch up the electric bill you missed.
 

Potentially get a negative entry on your credit reports. 

Risk a drop in your credit scores.
 

If you are late for several months, your electricity could be cut 

off. To get it turned on, you will have to not only catch up on 

payments, but also pay a fee to get your service turned back on. 

If you find you can’t pay all of your bills on time, try calling your creditors to make short-term 

arrangements. Do not ignore them, because ignoring them generally makes the problem worse 

for you. 

112 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Finally, after you have examined the consequences of not paying or paying bills late, and have 

called your creditors, make a short-term plan. Use Tool 4: When cash is short: prioritizing bills 

and spending, to make a plan. This tool is designed to help ensure you protect first those 

expenses associated with earning an income. If you don’t cover these expenses, you may 

jeopardize your ability to earn the money you need to pay any of your bills. 

When creditors call 

 Do not ignore bills you can’t pay. If you must miss a payment, call and explain that you 

will miss a payment and the reason for it. 

 If a creditor (such as a credit card company or medical provider) threatens to sue you, 

respond to any court documents. 

 When possible, do not risk additional expenses associated with protecting your income, 

shelter, assets, and failing to meet other legal obligations. 

 Consider the risk to your income, shelter, assets and the legal implications of delaying 

payment on your court-ordered obligations first, and then decide which bills to pay first. 

For more information on what creditors and debt collectors can and cannot do if you owe them 

money, visit Ask CFPB at http://www.consumerfinance.gov/AskCFPB. 

At the Ask CFPB page, you can search for the kind of information you specifically want on this 

and other topics. 

113 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Your rights in debt collection 

The Fair Debt Collection Practices Act (FDCPA) says debt collectors may not harass, 

oppress, or abuse you or any other people they contact. Some examples of harassment 

are: 

 Repeated phone calls that are intended to annoy, abuse, or harass you or any 

person answering the phone 

 Obscene or profane language 

 Threats of violence or harm 

 Publishing lists of people who refuse to pay their debts (this does not include 

reporting information to a credit reporting company) 

 Calling you without telling you who they are 

The FDCPA also says debt collectors cannot use false, deceptive, or misleading practices. 

This includes misrepresentations about the debt, including the amount owed, that the 

person is an attorney, threats to have you arrested, threats to do things that cannot legally 

be done, or threats to do things that the debt collector has no intention of doing. 

It is a good idea to keep a file of all letters or documents a debt collector sends you and 

copies of anything you send to a debt collector. Also, write down dates and times of 

conversations along with notes about what you discussed. These records can help you if 

you have a dispute with a debt collector, meet with a lawyer, or go to court. 

114 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 1: 

Spending tracker 

Spending 

Money you use to pay for a wide 

range of basic needs, your financial 

obligations, and other things you may 

want. 

Many people cannot tell you exactly how they get 

and spend their money during a month. Whether 

they have a lot of money to spend or are 

struggling to make ends meet, most people 

cannot account for all of the ways they use their 

money. 

Before you think about making any changes, it’s a 

good idea to understand how you use your money now. 

How can you do this? It takes three steps and commitment. The three steps are: 

1.	 Keep track of everything you spend money on for a week, two weeks, or one month. A 

month is best, because all of your income and your bills will be included. But, keeping 

up with the tracking for a month may be a challenge. 

2.	 Analyze your spending. See how much you spend in each category. Notice trends. 

Identify areas you can eliminate or cut back on. 

3.	 Use this information for figuring out where you can make changes. 

It takes commitment, because this is a lot of work. But, it’s important work. Many people are 

actually able to find money to save for emergencies, unexpected expenses, and goals by doing 

this work. Others are able to make their budgets balance. 

Get a simple plastic case or envelope. Every time you spend money, get a receipt and put it 

into the case or envelope. If the receipt doesn’t list what you purchased, take a few seconds and 

write it down on the receipt. If you don’t get a receipt, write one out on scrap paper. 

Analyze your spending. Use the following tool, Analyze Your Spending, for each week of the 

month. Go through your receipts. Enter the total you spent in the column that makes most sense 

to you. Be sure to write it in on the correct date. See how much you spend in each category. At 

the end of each week, add the amounts for each category. Once you have these totals, add them 

115 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
together to get a total spending for the week. You can track your spending for one week, two 

weeks, or an entire month. 

Notice trends. Circle those items that are the same every month (for example, rent, car 

payment, cell phone payment). These are often your needs and obligations. This will make 

creating your budget easier. Identify areas you can eliminate or cut back on—these will generally 

be wants. 

Here is a list of the categories that are used in the spending tracker: 

Savings Saving for goals, for emergencies, for children’s education, for 

retirement, for holiday purchases, for back-to-school shopping 

Debt payments Credit card, installment loan, payday loan, pawn loan, and car 

title loan payments; other loan payments 

Housing Rent, mortgage, insurance, property taxes 

Utilities Electricity, gas, water, sewage, phone, television, internet 

service, cell phone 

Household supplies and 

expenses 

Things for your home like cleaning supplies, kitchen appliances, 

furniture, other equipment 

Groceries Food and beverages you bring into the home to prepare, 

including baby food and formula 

Eating out (meals & 

beverages) Any meals or beverages purchased outside of the home 

Pets Food, healthcare costs, and other costs associated with caring 

for your pets 

Transportation Gas, car payment, insurance payment, repairs, public 

transportation 

Health care Co-payments, medication, eye care, dental care, health care 

premiums 

Personal care Haircuts, hygiene items, dry cleaning 

Childcare and school 

expenses 

Child care costs, diapers, school supplies, school materials 

fees, field trip and other activity fees 

116 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Entertainment 

Going to the movies, concerts, or sporting events; sports 

equipment/fees, lottery tickets, memberships, alcohol, 

books/CDs, subscriptions 

Court-ordered obligations Child support, alimony, restitution, etc. 

Gifts, donations, and other 

117 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Donations to religious organizations or other charities, gifts, 

other expenses 
Analyze your spending: Week ____ for the month of ____________________ 

On this worksheet, enter each amount from your receipts into its matching category column. Please take care to entry also matches the correct date. Add each column. Add the total of all of the columns to get total spending foand complete multiple copies of this sheet to analyze spending over the period of a month or longer. 

Date of month 

Savings

Debt payments

Housing

Utilities

Household suppl., exp.

Groceries

Eating out

Pets

Transportation 

Health care

Personal care 

Childcare & school

Entertainment 

Court-ordered oblig.

__ __ __ __ __ __ __ 

Total 

118 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Review your spending for the week or month. Which items cannot be cut or reduced? List these 

in the chart below. When you make your cash flow budget, you will just fill these into the cash 

flow. 

Spending that cannot be cut Reason 

Are there items that can be completely eliminated? If yes, the money spent on these items can be 

used on other things such as saving for emergencies or goals or paying down debt. 

Spending that can be eliminated Steps to eliminate 

Are there items that can be realistically reduced? If yes, list them below. Set new spending 

targets for these items and include them in your cash flow. 

Spending that can be reduced Strategies for reducing 

119 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Once you have tracked your spending, be sure to add it into your budget or cash 

flow budget. For more information on cash flow budgets, see Module 10: Managing cash 

flow. For more information on financial services that may help you pay your bills, see Module 

13: Evaluating financial service providers, products, and services. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

120 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Tool 2: 

Bill calendar 

Bills are a fact of life and—while they are not fun to pay—most bills are at least predictable. 

Figuring out which bills you expect throughout the month can be helpful in a couple of ways. 

Doing so helps you to plan to have enough money or other financial resources on hand to pay 

them. In addition, thinking about the amounts and timing of your bills might help you think of 

ways to reduce your expenses over the course of the month. Finally, some people find that 

thinking ahead about their bills helps reduce the stress of being surprised by bills when they 

arrive in the mail. 

Create a bill calendar using the following tool: 

1.	 Print the bill calendar. 

2.	 Fill in the name of the month and year. 

3.	 Add numbers to represent the days of the month. 

4.	 Gather all of the bills you pay in one month OR use the information from your Tool 1: 

Spending tracker. 

5.	 On another piece of paper, write down the due dates for these bills. 

6.	 Since due dates are when bills must arrive, also write the date bills must be sent: 

 If paying by mail, mark the due date at least 7 days before it is due. 

 For in-person or automatic bill payment, mark one or two days before the due date to 

ensure you are not late. 

7.	 Then fill in the calendar with the business or person you owe the money to, the date the 

money must be sent to arrive on time, and the amount that is due. 

8.	 Put this calendar somewhere you will see it every day to ensure you are not forgetting 

about important bills. 

121 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Here is a sample week to show you how the tool works: 

Sun. Mon. Tues. Wed. Thurs. Fri. Sat. End of 

Week 

1 2 3 4 5 6 7 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

Phone 

bill, $60 

Rent, 

$500 

Car payment, 

$180 

bills for 

week: 

$740 

Once you become comfortable with this tool, you may want to explore online bill reminder 

services or apps that help keep you on track for paying your bills on time. 

For more information on financial services that may help you pay your bills, see 

Module 13: Evaluating financial service providers, products, and services. 

122 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

______, 20__ 

Sun. Mon. Tues. Wed. Thurs. Fri. Sat. End of 

Week 

__ __ __ __ __ __ __ 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

bills for 

week: 

__ __ __ __ __ __ __ 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

bills for 

week: 

__ __ __ __ __ __ __ 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

bills for 

week: 

__ __ __ __ __ __ __ 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

bills for 

week: 

__ __ __ __ __ __ __ 

Bills: Bills: Bills: Bills: Bills: Bills: Bills: Total 

bills for 

week: 

123 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

124 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Tool 3: 

Strategies for cutting 

expenses 

If you do not have enough money or financial resources to pay your bills and expenses, you can 

do one of two things: 

 Increase your sources of cash, income, or other financial resources. 

 Decrease your spending or uses of cash and other financial resources. 

This tool focuses on ways to decrease spending or uses of cash and other financial resources. 

Not all of these strategies may apply to you. Check those that may be an option for you, and use 

this as a plan for getting more information or resources. 

if an 

option 

for you 

Strategy for cutting expenses 

and other uses of financial 

resources 

Additional information or 

resources you need to access 

this information 

Estimate $ 

value of 

spending cut 

you select 

Cut back on regular (recurring expenses) 

Television Check with your provider about 

bundling and lower cost plans or 

discontinue cable.

Internet Check with your provider about 

bundling and lower cost plans.

Phone Check if you qualify for a 

“Lifeline” phone rate.23 

23 For more information on Lifeline phone rates, see http://www.fcc.gov/guides/lifeline-and-link-affordabletelephone-service-income-eligible-consumers. 

125 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Cell phone plan Review prepaid or fixed-price call 

plans. Check if you qualify for a 

“Lifeline” phone rate.

Insurance Review insurance and consider 

increasing deductible on auto 

insurance to lower premium 

payment. 

Check to see if moving 

insurances to one company will 

save you money, and for other 

discounts. 

Energy costs Check to see if eligible for 

weatherization programs or other 

energy efficiency/savings 

incentives. 

Find ways to save on energy: 

turn off and unplug unused 

electric appliances, insulate and 

use weather stripping around 

doors and windows, set 

thermostat higher in summer and 

lower in winter. 

Other:

Get rid of regular (recurring) expenses 

Online video membership 

Discount store memberships if 

not using regularly 

Gym/health club membership 

(if not using) 

Credit monitoring services

Other: 

Avoid fees 

126 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

Review financial services. Could you switch to a no-fee or 

lower-fee account? 

Are you paying to cash your 

checks? 

Are you paying maintenance fees 

on checking or savings 

accounts? 

Do you pay overdraft fees? 

Are you paying annual fees for 

credit cards? 

Know the fees you are paying for 

your loans. 

Pay bills and fines like parking 

tickets on time. 

Parking tickets and other fines 

cost more if you pay them late. 

Return library materials, rented 

DVDs, etc. on time. 

Renew license and registration 

on time. 

Other: 

Other methods 

Negotiate a new due date for 

bills to make them easier to 

handle in cash flow. 

Avoid or cut back on eating out. Cut one meal out per month. 

If you buy lunch at work, could 

you save if you bring it instead? 

If you have children, identify the 

restaurants that have “kids eat 

free” nights. 

Avoid bottled water. Reuse water bottles. 

Avoid buying coffee or soda 

out. 

127 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 Use coupons. 

Buy second hand furniture or 

clothing if you need to replace 

either. 

Do not buy or rent DVDs or 

CDs. 

Visit your local public library. To 

avoid late fees, you have to 

return the items by the due 

dates. 

Buy items you use in bulk if 

they are cheaper that way. 

Look at the price label for cost 

per serving. Sometimes larger 

quantities don’t actually save 

money. 

Maintain your car. Get regular oil changes and keep 

tires inflated. This can save on 

fuel and can prevent major 

repairs. 

Other: 

Total reduction in spending for one month 

Once you have identified strategies for cutting your spending, adjust your cash 

flow. See Module 10: Managing cash flow. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

128 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS
Tool 4: 

When cash is short— 

prioritizing bills and spending 

Even when you increase sources of income or cut spending, you may still find yourself to be cash 

short. But when bill collectors are calling, it can seem easiest to just pay the “squeakiest wheel.” 

Take time to consider how each of your bills impacts these areas: protecting your job, your 

shelter, your assets, and meeting your legal responsibilities. 

You are responsible for paying all of your obligations on time. When you truly do not have 

enough money to cover your obligations and living expenses—this means you have cut out 

everything you don’t need—you may have to make a short-term plan to get through the month. 

Sometimes this may involve paying some bills late. Sometimes it may mean missing a bill. This 

can be an extremely stressful situation. While stressful, it requires careful, clear-headed 

thinking. Part of making this short-term plan involves understanding the consequences of 

delaying paying certain bills. And sometimes it means ignoring the squeakiest wheel for a short 

period of time. 

Use the following tool to help you make a short-term plan to get through those months where 

you cannot pay all your bills or living expenses. 

129 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Protect your income Protect your shelter Protect your assets Pay yo

If you need a car to get to and from work, stay current on your car payment and insurance. Maintain other expenses to keep your job. 

Whether you rent or have a mortgage, the costs of losing your home are big. Be sure to pay taxes, condo fees, mobile home lot payments, too. If possible, maintain your utilities. They are difficult to live without, and reconnection is expensive. 

Do not let essential insurance coverage lapse; this includes auto, renter’s / homeowner’s, health. Not having insurance puts your assets, including your health/your family’s health, at risk. 

Examp

 C In S

Your expenses: Your expenses: Your expenses: Your e

Remember, you are responsible for all of your bills and expenses. 

If you miss payments now, you will have to make those up in the future. 

130 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Resources 

For MyMoney.gov budgeting resources, visit: 

http://www.mymoney.gov/Fast/Pages/Results.aspx?k=Budgeting%20worksheets&s=All 

If you lose your job, visit the following for more information: 

http://www.benefits.gov 

http://www.dol.gov/ebsa/publications/joblosstoolkit.html 

If you are in a natural disaster, visit the following for more information: 

 http://www.fema.gov/disaster-survivor-assistance 

If you have a medical emergency you cannot afford, visit your state department of health 

and human services listed here: 

http://www.hhs.gov/recovery/statewebsites.html 

If you would like help managing your debt or rebuilding credit, visit the National 

Foundation for Credit Counseling: 

http://www.nfcc.org 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/Complaint 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

131 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

132 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

MODULE 10: 

Managing cash flow 

Cash flow and financial services 

Some banks and credit unions 

provide online financial management 

tools including income and spending 

tracking budget, and cash flow tools. 

If you have an account at a bank or 

credit union, check to see if these 

tools may be available for you. 

You may also want to explore the use 

of online financial management tools. 

Ensure the website is secure when 

entering personal or banking 

information. 

What is a cash flow budget? 

When it comes to money, timing matters. People 

often find themselves flush with cash one week— 

and pay several bills at once or splurge on 

something fun—but come up short the next week 

for a necessity. 

That’s why monthly budgets sometimes don’t 

work. If the timing of your income doesn’t match 

the timing of your expenses and you haven’t 

planned for it, you’ll come up short. 

A cash flow budget is a projection of how you will 

get and use your cash and other financial 

resources. A cash flow budget is different from a 

regular budget, because it includes not only the 

amount for each budget item, but the timing of 

your income and expenses. It breaks your 

monthly budget down week by week, accounting 

for when money is expected (income) and when it must be spent on needs, obligations, and 

wants. 

A cash flow budget can help you identify where you’re falling short within the month. It can help 

you ensure you have the financial resources on hand to cover the most important expenses—so 

you don’t fall short covering the rent, for example. A cash flow budget can also help you better 

target areas where you could consider cutting back. 

133 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

A cash flow budget is even more important for people who have irregular, seasonal, or one-time 

income. It can help you project and plan ways to spread the income you receive over the months 

you don’t have money coming in. 

Making a cash flow budget 

Making a cash flow budget involves three steps: 

1.	 Keeping track of everything you earn and spend money on for a week, two weeks, or one 

month. You can use Tool 1: Income and financial resource tracker from Module 8 and Tool 

1: Spending tracker from Module 9 to do this. 

2.	 Analyzing your spending. You can use Tool 1: Spending tracker from Module 9 to do this. 

3.	 Using this information to create a cash flow budget. You will use Tool 1: Cash flow 

budget to complete this step or Tool 2: Cash flow calendar. Your cash flow budget is about 

setting targets for how you will use your income going forward. 

134 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Tool 1: 

Cash flow budget 

Building a cash flow budget is important because when it comes to money, timing matters. It 

can help you make sure you have the resources on hand to cover the most important expenses. 

This is especially important if your income is irregular, seasonal, or one time. 

You can create a cash flow budget using the following form. There are “fixed” expenses such as 

rent and your car payment. These are expenses that you cannot cut back or that you would have 

to make major changes to lower, such as by moving or selling a car. Sometimes, though, you 

may find that you need to do this to make your cash flow work. 

If you find you want to cut back in other areas, put these new target levels of spending in your 

cash flow budget. For example, if you’re spending $350 per month on groceries now, you may 

decide to buy and cook in bulk and cut out bottled water to decrease that amount to $300. 

But remember, it’s important to be realistic when you set new spending targets. Your cash flow 

budget is about setting achievable targets for how you will use your income going forward. 

135 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Here are some important tips: 

1. Beginning balance for the week 

Your beginning balance for each week is the ending balance from the week before. When you 

start a cash flow, count the money you have in your pocket, on a prepaid debit card, or in an 

account you use to pay your bills to get your beginning balance. 

Week 1 Week 2 

Beginning balance for the week $37.00 $142.37 

Sources of cash and other financial resources 

Income from job $305.34 $290.80 

SNAP $280.00 

Public housing voucher $650.00 

Total sources of cash and other 

financial resources $1,272.34 $433.17 

Uses of cash and other financial resources 

Housing $650.00 

Utilities $59.97 $95.50 

Groceries $180.00 $80.00 

Eating out (meals and beverages) 

Transportation $240.00 $60.00 

Total uses of cash and other financial 

resources $1,129.97 $235.50 

Ending balance for the week $142.37 $197.67 

Move your ending 

balance from the 

previous week 

forward. 

To get a starting 

balance, total your 

cash, prepaid card, 

and account 

balances. 

136 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

2. Total sources of cash and other financial resources 

Add your beginning balance for the week to the other income you get that week. The total is the 

amount you have to pay for all of your expenses during that week. 

Week 1 Week 2 

Beginning balance for the week $37.00 $142.37 

Sources of cash and other financial resources 

Income from job $305.34 $290.80 

SNAP $280.00 

Public housing voucher $650.00 

Total sources of cash and other 

financial resources $1,272.34 $433.17 

Uses of cash and other financial resources 

Housing $650.00 

Utilities $59.97 $95.50 

Groceries $180.00 $80.00 

Eating out (meals and beverages) 

Transportation $240.00 $60.00 

Total uses of cash and other financial 

resources $1,129.97 $235.50 

Ending balance for the week $142.37 $197.67 

Add your beginning 

balance and all of 

the sources of cash 

and financial 

resources for the 

week. 

137 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

3. Total uses of cash and other financial resources 

Add all of your expenses and other uses of cash (savings and debt repayment) for the week. Note 

that some financial resources may only be used for specific expenses. For example, SNAP 

(Supplemental Nutrition Assistance Program) benefits can only be used for food and for plants 

and seeds to grow food for your household to eat. 

SNAP cannot be used for: 

 Any nonfood item, such as pet foods, soaps, paper products and household supplies, 

grooming items, toothpaste, and cosmetics 

 Alcoholic beverages and tobacco 

 Vitamins and medicines 

 Any food that will be eaten in the store 

 Hot foods24 

24 For details on eligible food items, see http://www.fns.usda.gov/snap/retailers/eligible.htm. 

138 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

4.	 Subtract your total uses of cash and other financial resources from your total 

sources of cash and other financial resources 

This will give you your ending balance for the week. It will also show you whether you have 

enough cash and other financial resources to make it through the week. 

Week 1 Week 2 

Beginning balance for the week $37.00 $142.37 

Sources of cash and other financial resources 

Income from job $305.34 $290.80 

SNAP $280.00 

Public housing voucher $650.00 

Total sources of cash and other 

financial resources $1,272.34 $433.17 

Uses of cash and other financial resources 

Housing $650.00 

Utilities $59.97 $95.50 

Groceries $180.00 $80.00 

Eating out (meals and beverages) 

Transportation $240.00 $60.00 

Total uses of cash and other financial 

resources $1,129.97 $235.50 

Ending balance for the week $142.37 $197.67 

Total sources 

minus total uses. 

This becomes your 

beginning balance 

for the next week. 

139 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Cash flow budget worksheet 

Week 1 Week 2 Week 3 Week 4 

Beginning balance for the week Sources of cash & other financial resources 

Income from job Income from part-time job Income from self-employment TANF SNAP Public housing voucher Other: 

Total sources of cash & other financial resources Uses of cash & other financial resources 

Credit card payments Payday loan payments Personal loans 

140 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Other debt 

Other payments Savings: emergency fund Savings: goals Savings: children's education Savings: retirement Rent or mortgage payment Homeowners or rental insurance Electricity Gas Water and sewer Cable or satellite television Internet service Phone and cell phone service 

141 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Groceries 

Eating out (meals and beverage) Car payment Gas for car Car maintenance Health insurance Health care deductibles and co-pays Personal care Childcare, diapers, and school fees and supplies Entertainment Contributions 

Total uses of cash & other financial resources Ending balance for the week (sources - uses) 

142 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Be sure to use tools you may have completed in other modules to build your cash flow. Look at M

goals, Module 7: Saving for the unexpected, emergencies, and goals, Module 8: Managing incom

Module 9: Paying bills and other expenses, and Module 11: Dealing with debt. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for the public. This materi

and information purposes only. It is not a replacement for the guidance or advice of an accountant, certified financial advisor, or otherwise qualified profe

responsible for the advice or actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts that CFPB has prepared. This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you or the organization us

responsible and has no control over how others may use the information that you provide to them about your personal or financial situation. Be cautious hrecommends that you do not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that and financial information; and shred hard copies that contain sensitive personal and financial information when no longer needed. 143 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

 

 

 

Tool 2: 

Cash flow calendar 

A cash flow approach to managing your money involves paying attention to the timing of your 

sources and uses of cash and other financial resources. This is important, because timing 

matters when you are making sure you have enough to cover your expenses. Tool 1: Cash flow 

budget uses a table to track those sources and uses from week-to-week. This tool takes the same 

cash flow approach, but uses a calendar format to plan for the weeks ahead. 

Use the information from your Module 8, Tool 1: Income and financial resource tracker and 

Module 9, Tool 1: Spending tracker to create a cash flow calendar using the blank calendar 

provided here. Start each new month by carrying over your balance from last month. Then enter 

the sources and uses of cash and other financial resources for each day of the week. 

At the end of every week take your beginning balance, add your total sources, and subtract your 

total uses. That number will be what you have left, your weekly ending balance. 

Here is a sample week to show you how the tool works: 

Sun. Mon. Tues. Wed. Thurs. Fri. Sat. End of Week 

31 1 2 3 4 5 6 

Beginning bal.: 

$130 + 

Total sources: 

$585 – 

Total uses: 

Sources 

SNAP, 

$280 

Pay, 

$305 

Uses 

$450 = 

Ending bal.: 

$265 

Food, 

$180 

Phone 

bill, $60 

Gas, 

$30

 Car 

Payment, 

$180 

145 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

______, 20__ 

Sun. Mon. Tues. Wed. Thurs. Fri. Sat. End of Week 

__ __ __ __ __ __ __ Beginning bal.: 

_________ + 

Total sources: 

_______ – 

Total uses: 

_______ = 

Ending bal.: 

__________ 

Sources 

Uses 

Sun. Mon. Tues. Wed. Thurs. Fri. Sat. End of Week 

__ __ __ __ __ __ __ Beginning bal.: 

_________ + 

Total sources: 

_______ – 

Total uses: 

_______ = 

Ending bal.: 

__________ 

Sources 

Uses 

Reproduce this sheet to manage your cash flow for additional weeks. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

146 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

147 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 3: 

Improving cash flow checklist 

If you created a cash flow using the spreadsheet or the calendar, you may find that some weeks 

are not working out—you are not able to pay your bills on time. 

Improving cash flow comes down to one of three strategies: 

 Smooth out cash flow by avoiding large periodic payment by making smaller 

payments throughout the month or year. 

 Cut out spending. 

 Increase income or other resources. 

Sometimes short-term changes to expenses or finding ways to temporarily increase income can 

help improve your cash flow now, and sometimes the changes you make will need to stay in 

place for a long time to make a difference. 

Some of these suggestions may not work for you. Check those that may be options for you and 

use this checklist as a plan to put the ideas into action. 

149 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
if 

option 

for you 

Strategy for improving cash 

flow 

Tips and more information Notes 

Smooth out cash flow 

Negotiate new due dates for 

bills to better line up with when 

you get income. 

Check with businesses you have 

had a long-standing relationship 

with first. 

Negotiate splitting a monthly 

payment into two smaller 

payments. 

For example, if a $700 rent 

payment is due the first of the 

month, see if you can make a 

$350 payment on the 1st and a 

$350 on the 15th . 

Avoid large, lump sum or 

periodic payments by making 

monthly payments—car 

insurance and taxes, for 

example. 

You may have to pay a small fee 

to make this arrangement, but it 

may make handling these 

payments more manageable. 

Set up a savings account and 

automatically deposit the 

monthly amount of large, lump 

sum payments into the 

account so you are prepared 

when they are due. 

To do this you need regular 

income, a bank or credit union 

account, or a reloadable prepaid 

debit card. 

Explore level payment plans 

for utilities. 

This is especially important in 

extreme climates—with high 

heating bills in the winter or high 

cooling bills in the summer. You 

often have to be a customer in 

good standing to qualify for these 

programs. Check with your local 

utility providers. 

Check to see if you qualify for 

an energy assistance 

program. 

Ask for a referral to the agency in 

your community that manages 

energy assistance programs. 

150 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Seek credit counseling or If you have many debts and good 

explore debt consolidation. credit, consider credit counseling 

exploring debt consolidation with a 

bank or credit union. This can 

make managing your cash flow 

easier because the monthly 

payment may be smaller – but it 

may take you longer to completely 

pay off the debts and cost more in 

the long run. Be sure you 

understand the terms and are not 

paying more interest with your 

new loan. See the Resources list 

at the end of the module for credit 

counseling links. 

Refinance your car or home 

for lower interest rates if 

possible or explore extending 

the time you will repay the 

loan. 

Be sure to do the math to ensure 

the new rate (including the fees) 

really does save you money over 

time. While it may cost you more 

in the long run, it may make 

monthly payments more 

manageable. 

Check to make sure your 

withholding enough tax with 

your employer. 

This can help ensure you do not 

end up with a large income tax bill 

because your withholding was too 

low. 

If you have student loans, See if you qualify for incomecheck to see if you have based repayment or other 

repayment options. programs. 

http://studentaid.ed.gov/repayloans/

 Other: 

151 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

Cut out spending 

Review television, internet, Check with your provider about 

phone, and cell phone plans. bundling and lower cost plans or 

discontinue cable. 

Check to see if you qualify for a 

“Lifeline” phone rate. Visit 

http://www.fcc.gov. 

Review insurance and check Check to see if moving insurances 

to make sure you have the to one company will save you 

right deductibles for auto and money, and check for other 

home insurance. discounts. 

Find ways to save on energy: 

Turn off and unplug unused 

electric appliances. 

Insulate and use weather 

stripping around doors and 

windows. 

Set thermostat higher in 

summer and lower in winter. 

Check to see if eligible for 

weatherization programs or other 

incentives. 

Eliminate online video or 

music pass membership. 

Eliminate gym/health club or 

discount store memberships if 

not using regularly. 

Eliminate credit monitoring 

services if you are paying for 

them. 

Pay bills and renew license 

and registration on time to 

avoid late fees. 

Return library materials, 

rented DVDs, etc. on time. 

152 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Access community resources 

for some living expenses. 

See if you qualify for community 

food programs, clothing closets, 

transportation voucher programs, 

childcare subsidies, etc.

 Other: 

Increase income 

Take another part-time job if 

your schedule allows. 

Work odd jobs. 

Apply for benefits for which 

you may qualify. 

Visit http://www.benefits.gov. 

File taxes so that you can 

receive a refund if you qualify. 

Consider saving some of your 

refund to help pay bills for the rest 

of the year.

 Other: 

153 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Resources 

For MyMoney.gov budgeting resources, visit: 

http://www.mymoney.gov/Fast/Pages/Results.aspx?k=Budgeting%20worksheets&s=All 

If you want more information on budgeting, visit: 

http://www.mymoney.gov/tools/Pages/tools.aspx 

For more information on benefits, visit: 

http://www.benefits.gov 

If you want more information about finding a job, visit this site to get started: 

http://www.dol.gov/dol/audience/aud-unemployed.htm 

Or visit your state department of labor website for state specific resources. 

To find a one-stop career center located near you, visit: 

http://www.servicelocator.org 

If you lose your job, visit the following for more information: 

http://www.benefits.gov 

http://www.dol.gov/ebsa/publications/joblosstoolkit.html#.UM6BmXPjkt8 

If you would like help managing your debt or rebuilding credit, visit the National 

Foundation for Credit Counseling: 

http://www.nfcc.org 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

154 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/Complaint 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

155 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

MODULE 11: 

Dealing with debt 

What is debt? 

Debt is money you have borrowed from a person or a business. When you owe someone money, 

you have a liability. When you owe money, you have to pay it back, sometimes in the 

form of scheduled payments. Often you use money from your future income to 

make those payments. While borrowing money may give you access to something today, you 

may have monthly payments for months or years going forward. This obligation may decrease 

your options in the future. 

Debt is different from credit. Credit is the ability to borrow money. Debt results from using 

credit. You can have credit without having debt. For example, you may have a credit card but no 

outstanding balance on it. 

Good debt, bad debt? 

Sometimes people label debt as good debt or bad debt. Some debt can help you reach your goals 

or build assets for the future. People will often say that borrowing for your education, for a 

reliable car, to start a business, or to buy a home can be a good use of debt. 

But it’s not always that simple. For example, borrowing to further your education may be a good 

use of debt because earning a certification or a degree may lead to a better paying job and more 

job security. But if you take on the debt and don’t earn the certificate or degree, this student debt 

has set you back instead of helping you reach your goals. 

157 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Taking out a loan for a reliable car to get to and from your job can help you stay on track to meet 

your goals. However, if you borrow 100% of the car’s value, you may end up owing more than 

the car is worth. Or if you buy a more expensive car than you need, you’ll have less money for 

other bills each month. While it may get you to work, it might keep you from getting to your 

financial goals. 

Borrowing money to start a business may help create income for yourself and others. If the 

business fails, however, you may end up owing money and not having any income you can use to 

make the payments. 

Finally, taking out a loan to buy a home of your own may be a way to reach your personal goals. 

But if you are unable to keep up with the payments or you end up owing more than your home is 

worth, that debt may set you back for a long time. 

This information is not meant to scare you. It’s simply meant to show you that even debt that 

many people consider “good” should be approached with caution. 

Some people consider loans such as credit card debt, short-term loans, and pawn loans “bad” 

debt. This is because they carry fees and interest, and when they have been used for things you 

consume (like meals out, gifts, or a vacation) they do not help build assets. But, these sources of 

debt can help cover a gap in your cash flow if you have a way to repay them. So, there is no one 

type of debt that is “good” or “bad.” That’s why it’s important to first understand your goal or 

your need. Then you can shop for the credit you need, especially for purchases like a car or a 

home, before you make your final decision on your purchase. 

Another way to understand debt is whether it is secured or unsecured. 

Secured debt is debt that has an asset attached to it. When debt is secured, a lender can collect 

that asset if you do not pay. Here are examples of secured debt: 

 A home loan. The debt is secured with the home you are buying. If you do not pay your 

loan, the lender can foreclose on your home, sell it, and use the money from the sale to 

cover your loan. 

 An auto loan. The debt is secured with your car. If you do not pay your loan, the lender 

can repossess (repo) your car and sell it to cover the loan. 

 A pawn loan. The debt is secured with the item you have pawned. If you do not make 

payment when it is due, the pawned item is eventually sold. 

158 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Student Loan Debt 

For many people, student loans 

make up a big portion of the debt 

they owe. Sometimes people 

borrow more than they will be able 

to afford given the likely pay they 

will earn in their profession. 

Sometimes people get into trouble 

because they do not understand the 

terms of their loans and the 

consequences of letting interest 

build up.

Rent-to-own versus installment 

plans 

In a rent-to-own arrangement, 

consumers lease items such as 

furniture, electronics, or appliances 

and typically have the option to 

purchase. 

This can be done by continuing to 

make payments for a set period of 

time or by paying off the balance 

during the term of the lease. If you 

don’t make the payments made as 

agreed, the item can be taken back 

and you don’t receive a refund for 

any of the rental payments. 

 A secured credit card. The debt you incur is 

secured by funds you deposit at a bank or 

credit union. Your credit limit will generally 

equal your deposit. For example, if you 

deposit $300, your credit limit will be $300. 

Unsecured debt does not have an asset attached 

to it. Here are examples of unsecured debt: 

 Credit card debt from an unsecured card 

 Department store charge card debt 

 Signature loans 

 Medical debt 

 Student loan debt 

If these loans are not paid as agreed, they often go 

to collections. 

Using Tool 1: Debt management worksheet, you 

can list all of your debts and determine whether they are secured or unsecured. For more 

information on student loan debt, see Tool 4: Student loan debt. 

How much debt is too much debt? 

One way to know if you have too much debt is based on how much stress your debt causes you. 

If you are worried about your debt, you likely have too much. 

A more objective way to measure debt is the debt-to-income ratio. The debt-to-income ratio 

compares the amount of money you pay out each month for debt payments to your income 

before taxes and other deductions. The resulting number, a percentage, shows you how much of 

your income is dedicated to debt—your debt load. The higher the percentage, the less financially 

secure you may be, because you have less left over to cover everything else. Everything else is all 

of the other needs, wants, and obligations you pay each month that are not debt. 

159 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
These include: 

 Rent 

 Savings 

 Taxes 

 Insurance 

 Utilities 

 Food 

 Clothing 

 Childcare 

 Health care (that has not turned into debt) 

 Child support and other court-ordered 

obligations 

 Charitable contributions and gifts 

 Other family expenses 

Debt-to-income ratio 

The debt-to-income ratio is a 

simple calculation: 

Total of your monthly debt 

payments ÷ Monthly gross income 

(income before taxes). 

The result is a percentage that tells 

you how much of your income is 

going toward covering your debt. 

For example, if you have a debt-toincome ratio of 36%, you have 64 

cents out of every dollar you earn to 

pay for everything else, including 

all of your living expenses and 

taxes. 

Using Tool 2: Debt-to-income worksheet, you will determine what your debt load is. And if you 

find out that it is higher than you want, you can use Tool 3: Debt reduction strategies worksheet 

to make a plan to get out of debt. 

Avoiding debt traps 

If you are considering loan products that meet an immediate need, it’s important to avoid debt 

traps on your path to your goals. 

A debt trap is a situation where people take a loan and have to take new loans to 

make the payment on the first loan. It is called a trap because for many people, it becomes 

difficult to escape the cycle of borrowing and taking on more debt to cover the loan payment and 

still be able to pay for other expenses like food, rent, and transportation. 

160 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

A debt trap can happen when people use short-term loans that have to be paid back in just a 

couple of payments such as payday loans. Signature loans and deposit advance loans are other 

examples of short-term loans. 

These loans have many things in common. They: 

 Are small dollar loans— generally under $500 

 Must be repaid quickly—14 days is the median term of payday loans 

 Require the borrower to give creditors access to repayment through an authorization to 

present a check or debit a borrower’s deposit account 

Common misunderstandings about payday loans and deposit 

advance products 

If you are considering these products, it’s important to be aware of common misunderstandings 

and the facts about payday and deposit advance loans. 

1.	 The money is borrowed for emergencies. 

Fact: Most borrowers do not use their first loans for emergency expenses. The Pew 

Charitable Trusts’ Payday Lending in America25 found that 69% of first-time borrowers 

use the loan to pay for regular bills, while only 16% use them for emergencies such as a 

car repair. 

2.	 The borrowers can pay back the loan. 

Fact: While they may pay it back on time, many borrowers have to either immediately 

take a new loan or take another one in the same pay-period. A CFPB study26 found that 

payday borrowers are in debt for a median of 199 days (nearly seven months) of the year 

25 The Pew Charitable Trust State and Consumer Initiatives. Payday Lending in America. October 2013. 

http://www.pewstates.org/research/featured-collections/payday-lending-in-america-85899405692. 

26 Consumer Financial Protection Bureau. Consumer Financial Protection Bureau Study Finds Debt Trap Concerns 

with Payday and Deposit Advance Loans. April 2013. http://files.consumerfinance.gov/f/201304_cfpb_paydayfactsheet.pdf. 

161 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

and pay a median of $458 in fees (not including the principal). The Pew Charitable 

Trust27 found similar results – that on average, borrowers are in debt for five months out 

of the year and pay an average of $520 in fees on top of the money they have borrowed. 

Deposit advance loans 

Deposit advance loans are short-term loans made by banks. The loan is secured by the 

borrower's deposit account to which the bank has access. The loan is limited to a 

percentage of the recurring direct deposit: the lesser of $500 or 50% of the scheduled 

direct deposit based on the amount from the previous deposit into the account. 

Repayment is due the next time the direct deposit is made into the account. The bank 

sweeps the amount of the loan plus the fees from the account before any transactions can 

be made from the account. In some instances, this puts the borrower into overdraft 

(where she is charged more fees for any subsequent draws on the account). 

Many banks are discontinuing this product, but clients may still find them at some banks. 

27 The Pew Charitable Trust State and Consumer Initiatives, Payday Lending in America, October 2013. 

http://www.pewstates.org/research/featured-collections/payday-lending-in-america-85899405692. 

162 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
How do payday loans work? 

Here is an example of how a 14-day payday loan generally works: 

Borrower visits a storefront payday lender and completes application (there is 

generally no credit check or ability to repay the loan; the 

borrower only needs a deposit account so he can write a post-dated 

check). Loans also be taken out 

Borrower gets loan (the median loan amount is $350) and pays $10-$20 per $100 

borrowed ($15 per $100 is the median fee). 

The borrower provides the lender with 14-day post-dated check for the amount of 

the loan + the fee or $350 + $52.50 = $402.50 or authorization to present a debit 

against the borrower's account. 

In 14 days, the loan is due. Often, the borrower does not have $402.50 to satisfy the 

debt. Instead he will pay the fee ($52.50) and renew the loan for another 14 days. 

(Note: 14 days is used for example purposes only. Repayment may fall on the next 

payday or another minimum period as specified by state law.) 

Every 14 days, the borrower must pay the full amount or renew the debt for $52.50. 

The average borrower has 10 transactions a year. Applied to this loan, that would 

mean a fee of $525 to borrow $350. 

163 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Alternatives to high-cost credit 

There are ways to avoid a debt trap if you’re in a situation where you need money quickly. 

If you are short on cash, consider other alternatives, including: 

 Using your own emergency savings 

 Using lower-cost short-term loan alternatives from a credit union or bank 

 Borrowing from a friend or family member 

 Using a credit card – while it will increase your monthly card payment, it may prove 

cheaper in the long run 

 Negotiating for more time to pay if the loan is for a bill that is due 

 Bartering for part or all of what you are borrowing the money to cover 

 Determining whether the item or circumstance you are borrowing the money for is a 

need, an obligation, or a want. If it’s a want, consider whether it’s possible to spend less 

money for it or not purchasing it. 

The cost of high-cost credit 

Here is an example scenario using different options for taking care of emergency expenses. The 

example examines the costs of paying for an unexpected expense with emergency savings, a 

credit card, or a payday loan. 

164 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

COST TO REPLACE SPARK PLUGS IN YOUR AUTOMOBILE = $350 

Emergency 

savings Credit card Payday loan 

Amount $350 $350 $350 

APR28 21.99% annual percentage rate 

(APR) 

$15 for every $100 borrowed for 14 days. 

This means a 391% annual percentage 

rate (APR).29 

Payment 

Must pay at least a certain 

amount each month.30 (For the 

purposes of the example, the 

individual is choosing a fixed 

monthly payment of $50.) 

Must pay back loan amount ($350) plus 

fee ($52.50) within 14 days. If entire loan 

cannot be paid within 14 days, it can be 

rolled over (or extended) for another 14 

days for an additional fee of ($52.50).31 

Total 

cost and 

time to 

repay 

$0 

You would pay $28.11 in interest 

in addition to the principal 

borrowed. It will take just over 

eight months32 to pay back the 

full amount. 

The total cost depends on how long it 

takes you to save up to pay back the 

entire loan. If you renew or roll over this 

loan seven times, you would be in debt 

for 14 additional weeks and could pay up 

to $367.50 in fees.33 

28 These are for example purposes only. Actual credit card and payday loan terms vary, and some states restrict 

payday loans. The CFPB notes that, APRs on credit cards can range from about 12 percent to 30 percent. For payday 

loans, the CFPB notes that the cost of the loan (finance charge) may range from $10 to $30 for every $100 

borrowed. A typical two-week payday loan with a $15 per $100 fee equates to an APR of almost 400%. See CFPB, 

What is a payday loan? November 6, 2013. See http://www.consumerfinance.gov/askcfpb/1567/what-paydayloan.html. 

29 Some states have adopted laws that limit the amount of loan above a certain amount and/or limit the interest rates 

of these loans. 

30 Most credit card companies allow customers to pay a percentage of the amount owed, which makes the minimum 

payment vary from month to month. For the purposes of this example, we are showing a fixed monthly payment. 

31 These numbers and terms are for example purposes only. Actual costs and terms of payday or signature loans will 

vary. See Consumer Financial Protection Bureau, Payday Loans and Deposit Advance Products: A White Paper of 

Initial Data Findings, April 24, 2013. See http://files.consumerfinance.gov/f/201304_cfpb_payday-dapwhitepaper.pdf. 

32 To pay off this credit card balance in full, the individual will have to make $50 payments for seven months, and 

then pay just over $28 in the eighth month. 

33 Two–thirds of repeat payday borrowers take more than seven loans in one year. Consumer Financial Protection 

Bureau, Payday Loans and Deposit Advance Products. 

165 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Dealing with a debt collector 

Often people find out they have a debt in collection when they receive a letter or phone call from 

a debt collection agency. Sometimes, they don’t remember owing a debt, so they are surprised 

when they’re told a debt has gone to collections. For some people, this can feel overwhelming. 

Debt collectors use persuasive techniques to get you to send in money. Do not send money or 

even acknowledge the debt the first time you are contacted. This is because: 

 You want to make sure you actually owe the debt. 

 You want to make sure the individual contacting you really has the authority 

to collect the debt. 

If you know the debt is not your debt, you can ask the debt collector to stop contacting you. 

Before sending money or acknowledging the debt, ask the debt collection agency to verify the 

debt. Do this by sending a letter within 30 days of the debt collector’s first contact asking them 

to verify the debt is yours and that they have the authority to collect it. Use the sample letters in 

Tool 5: When debt collectors call to get started. 

Even if the debt may be yours, you have the right under the Fair Debt Collection Practices Act 

(FDCPA) to ask the debt collector to stop contacting you. Once you make this request, they can 

contact you to tell you that they won’t contact you again. Or they may notify you that they or the 

creditor could take other action (for example, filing a lawsuit against you). 

Stopping them from contacting you does not cancel the debt. You still might be 

sued or have debt reported to the credit reporting agencies (Equifax, Experian, 

and TransUnion). 

You can ask a debt collector to stop contacting you at any time, so keep in mind that you could 

ask them for more information before deciding whether to tell them to stop contacting you. 

166 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Your rights in debt collection 

The Fair Debt Collection Practices Act (FDCPA) says what debt collectors can and cannot 

do. This law covers businesses or individuals that collect the debt of other businesses. 

These are often called “third party debt collectors.” This law does not apply to businesses 

trying to collect their own debts. 

The law states that debt collectors may not harass, oppress, or abuse you or any other 

people they contact. Some examples of harassment are: 

 Repeated phone calls that are intended to annoy, abuse, or harass you or any 

person answering the phone 

 Obscene or profane language 

 Threats of violence or harm 

 Publishing lists of people who refuse to pay their debts (this does not include 

reporting information to a credit reporting company) 

 Calling you without telling you who they are 

The law also says debt collectors cannot use false, deceptive, or misleading practices. This 

includes misrepresentations about the debt, including the amount owed, that the person 

is an attorney, threats to have you arrested, threats to do things that cannot legally be 

done, or threats to do things that the debt collector has no intention of doing. 

Keep a file of all letters or documents a debt collector sends you and copies of anything 

you send to a debt collector. Also, write down dates and times of conversations along with 

notes about what you discussed. These records can help you if you have a dispute with a 

debt collector, meet with a lawyer, or go to court. 

167 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 1: 

Debt management worksheet 

Before you can make a plan for your debt, you have to know where you stand. You can start by 

making a list of who you owe money to and how much you owe them. This is the first 

step in managing and reducing your debt. 

Be sure to include debts to friends and family, credit card companies, banks, department stores, 

payday lenders, and the federal government (for student loans and income taxes, for example). 

On the debt management worksheet, you will include: 

 The person, business, or organization you own money to 

 The amount you owe them 

 The amount of your monthly payment, which includes the principal, interest payments, 

and any fees you may owe 

 The interest rate you are paying and other important terms 

To complete this worksheet, you may need to get all of your bills together in one place. 

169 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

Use this worksheet to list who you owe money to and how much you owe them. This is the first 

step in managing and reducing your debt. Lender Total amount borrowed Amount outstanding Total

payment amount Payment due dateSecured? If yes, by what. Interest rateOther importantterms 

Mortgage 

Vehicle loan 

Appliance/furniture loan 

Student loan 

Credit card/Charge card debt 

Payday loan 

Car title loan 

Other 

Total monthly debt payment 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

170 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

171 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 2: 

Debt-to-income worksheet 

Your debt-to-income ratio is like your blood pressure. Your blood pressure measures the 

amount of pressure on your heart; your debt-to-income ratio measures how much pressure debt 

is putting on your budget. 

Your debt-to-income ratio is a simple calculation. It is the total of your monthly debt payments 

divided by your monthly gross income. Gross income is the amount of your income before any 

taxes or other deductions are taken. 

The result is a percentage. This tells you how much of your income is going toward covering 

your debt. 

Another way of seeing the debt-to-income ratio is that it represents how much of every dollar 

you earn goes to cover your debt. 

For example, if your debt-to-income ratio is .45, or 45%, then 45 cents out of every dollar you 

earn goes toward your debt. This leaves you with 55 cents of every dollar to cover your rent, 

taxes, insurance, utilities, food, clothing, child care, and so on. 

In addition to using the debt-to-income ratio to measure how much pressure debt is putting on 

your budget, you can also use it as a benchmark if you implement a debt reduction plan. As you 

pay down your debts, your debt-to-income ratio will also decline. And this will result in money 

being freed up to use on other things, such as saving for your goals, unexpected expenses, and 

emergencies. 

173 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Use the following tool and the analysis to figure out your debt-to-income ratio. 

Your total monthly debt payment (from Tool 1) 

DIVIDED BY 

Your monthly gross income (Income before taxes) 

EQUALS 

Your current debt-to-income ratio 

Understanding your debt-to-income analysis 

If your debt-to-income ratio is higher than these percentages below, it could be difficult to pay 

all your monthly bills because so much of your income will be going to cover debts. A high debtto-income ratio may also impact your ability to get additional credit because creditors may be 

concerned that you would not be able to handle their debt on top of what you already owe. 

The following debt-to-income ratio ranges are guidelines. These ranges are not rules. In fact, 

many creditors set their own guidelines. What is an acceptable level of debt to one creditor may 

not be to another. 

 For renters: Consider maintaining a debt-to-income ratio of 15% -20% or 

less. 

 This means that monthly credit card payments, student loan payments, auto loan 

payment, and other debts should take up 20% or less of your gross income. 

 For homeowners: Consider maintaining a debt-to-income ratio of 28% -35% 

or less for just the mortgage (home loan), taxes, and insurance. 

 This includes the monthly principal, interest, taxes, and insurance (called PITI). 

 For homeowners: Consider maintaining a debt-to-income ratio for all debts 

of 36% or less. 

174 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 This means that if you have a mortgage and other debts—credit card payments, 

student loan payments, auto loan payment, and payday loan payments–your debt-toincome ratio should be below 36%. 

 If you have court-ordered, fixed payments, such as child support, count these as debt 

for this purpose. 

 Some lenders will go up to 43% or higher for all debt.34 

If your debt-to-income ratio is above these limits, you may want to use the 

following tool to develop a plan to reduce your debt and lower your debt-to-income 

ratio. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

34 See http://www.fha.com/fha_requirements_debt. 

175 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 3: 

Debt-reduction worksheet 

When it comes to reducing your debt, there are two basic strategies: 

Highest interest rate method 

Focus on the unsecured debt with the highest rate of interest, and eliminate it as quickly as 

possible, because it is costing you the most. Once it is paid off, focus on the next most expensive 

debt. 

PRO CON 

You eliminate the most costly debt first. You may not feel like you are making progress 

very quickly, especially if this debt is large. 

PRO 

177 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Snowball method 

Focus on the smallest debt. Get rid of it as soon as possible. Once you have paid it off in full, 

continue with the payment, but now dedicate it to the next smallest debt. This is called the 

“snow ball method.” You create “a snow ball of debt payments” that keeps getting bigger as you 

eliminate each debt. How? You keep making the payments, but you are redirecting them to the 

next debt as each debt is paid off. 

CON 

You may see progress quickly, especially if You may pay more in total because you are 

you have many small debts. For some people, not necessarily eliminating your most costly 

this creates momentum and motivation. debt. 
There are other things you can do, too. 

 Call your creditors to see if they will lower your interest rates. If you have paid all of your 

bills on time, they may lower it to maintain your loyalty. If you are in a difficult position, 

you could explain your hardship and ask them to lower the rate. 

 Get another job in the short-term. Use all of your additional earnings to eliminate debts. 

 Sell something, and use the income to pay off a debt or debts. 

 If you are eligible, file for tax credits, and use your refund to pay down or eliminate 

debts. 

Check the method you are going to use, and then follow the instructions. 

 Highest interest rate method 

1.	 List your debts from highest rate to lowest rate. 

2.	 In the column labeled Extra Payment, list the extra payment you will dedicate to the 

debt with the highest interest rate until you have it paid off. 

3.	 When this debt is paid off, allocate the entire payment (monthly payment + extra 

payment) you were making to the next debt on the list. 

 Snowball method 

1.	 List your debts from smallest to largest in terms of the amount outstanding. 

2.	 In the column labeled Extra payment, list the extra payment you will dedicate to the 

smallest debt until you have it paid off. 

3.	 When this debt is paid off, allocate the entire payment (monthly payment + extra 

payment) you were making to the next debt on the list. 

178 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

LenderTotal amount borrowedAmount outstandingMonthlypayment Extra payment Monthly DuedateDate paid off infull 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

179 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 4: 

Student loan debt 

The CPFB has a section on its website dedicated entirely to helping you plan for ways to pay for 

postsecondary education. In fact, the tool will help you think through the entire process of 

planning for and paying for school including: 

 Researching schools 

 Filling out the Free Application for Federal Student Aid (FAFSA), a first step in figuring 

out how to pay for college 

 Choosing a loan 

 Comparing financial aid packages and college costs across more than one school 

 Managing your money while in college 

 Repaying your student loans 

If you have student loan debt, start with the Repaying Your Student Loans section of the tool, 

which can be accessed at: http://www.consumerfinance.gov/paying-for-college/repay-studentdebt/#Question-1. 

Repaying federal student loans 

There are two general kinds of student loans: federal student loans and private student loans. 

Federal student loans are loans that are funded by the federal government. Private 

student loans are nonfederal loans made by a lender such as a bank, credit union, state 

agency, or a school. In both federal and private student loans, delinquent payment will impact 

your credit history and scores and may result in collections. Private student loans do not offer 

the flexible repayment terms or borrower protections featured by federal student loans. 

There are many options for paying back federal student loans. Do not ignore student loan 

paperwork—nonpayment and delinquency reduces options for payment plans as many require 

loans in good standing to qualify. Some of the repayment options include: 

181 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Standard Repayment. Most borrowers start with this payment plan. This repayment 

plan has fixed payment of at least $50/month for up to 10 years. 

 Graduated Repayment. The payment is lower the first year and then gradually 

increased every 2 years for up to 10 years. 

 Extended Repayment. The payment is fixed or graduated for up to 25 years. The 

monthly payments are lower than the standard or graduated repayment plans, but you 

will pay more interest over the life the loan(s). 

 Income-Based Repayment (IBR). Payment is limited to 15% of discretionary 

income, which is the difference between your adjusted gross income and 150% of the 

Federal Poverty Guidelines. Payments change as income changes and the terms can last 

up to 25 years. After 25 years of consistent payment (you have missed no payments or 

caught up with payments), the loan will be forgiven. You will have to pay income tax on 

the portion of the loan that is forgiven. To qualify for IBR, you must be able to show 

partial hardship. 

 Pay as You Earn. Payment is limited to 10% of discretionary income as defined above, 

payment changes as income changes, and the loan term is 20 years. After 20 years of 

payments, the loan is forgiven as described above, and taxes will be owed on the amount 

forgiven. To qualify for pay as you earn, you must be able to show partial hardship. 

 Consolidation Loan. You pay off all of your existing federal student loans with a new 

loan. This simplifies paperwork and payment for you—you go from monthly payments 

on multiple loans to one payment per month on the one new loan. Your loans must be in 

good standing to qualify. This results in lower monthly payments as the term is 30 years; 

however, you will pay more interest over the life of the loan. 

You may also qualify for deferment or forbearance in certain circumstances. In deferment, 

payment of both principal and interest is delayed. If you have a subsidized federal loan, the 

government pays your interest during the deferment. Otherwise you must pay interest or it 

accrues, which means builds up. When interest builds up on student loans, it becomes part of 

what you owe. This means you ultimately end up paying interest on the interest. Deferments 

are only granted for specific circumstances including: 

 Enrollment in college, a trade school, a graduate fellowship, or a rehabilitation program 

for individuals with disabilities 

182 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 During unemployment 

 During military services 

 During times of economic hardship, including Peace Corps service 

Forbearance means that you stop paying or pay a lesser amount on your loan for a 12-month 

period. Interest accrues during forbearance. 

When applying for a repayment option, be sure to continue making your loan payments until 

you receive written notification that you have been approved for IBR or forbearance, for 

example. This ensures your loan continues to be in good standing. 

Finally, you may also apply for loan forgiveness, cancellation, or discharge in the 

following situations: 

 Total and permanent disability 

 Death (someone would apply on your behalf) 

 Closed school 

 Teacher loan forgiveness ( if you are a teacher working in certain educational settings) 

 Public services loan forgiveness (if you work in a public service sector and have made 120 

loan payments) 

Except for the above circumstances, it is nearly impossible to eliminate federal student loan debt 

even in bankruptcy. And your wages and bank accounts can be garnished for nonpayment. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

183 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 5: 

When debt collectors call 

Ask for more information 

Before sending money or acknowledging the debt, ask the debt collection agency to verify the 

debt. You can do this by sending a letter within 30 days of the debt collector’s first contact 

asking them to verify the debt is yours and that they have the authority to collect it. 

You can use the sample letter on the next page to ask for more information about this debt. 

 Read the information below. 

 Edit the letter as needed to fit your situation. Delete any bullets that don’t apply to you, 

or isn’t information you’re looking for. 

 Print and send the letter as soon as you can. Keep a copy for your records. 

Send this letter as soon as you can and, if at all possible, within 30 days of when a debt 

collector contacts you the first time about a debt. Even if 30 days have passed, and a debt 

collector isn’t legally required to give you certain information, you can still ask for it. 

If you ask in writing before the deadline, a debt collector has certain legal 

responsibilities to give you some information. But if the collector doesn’t provide 

everything you request, that doesn’t necessarily mean the debt collector has broken any laws or 

has given up a legal right to collect a debt. The debt collector could still be allowed to demand 

that you pay, or file a lawsuit. If you have specific questions, contact an attorney. 

If the debt collector makes vague statements about what will happen if you do not pay, read 

their response to your letter carefully. Federal law prohibits a debt collector from 

deceiving you by threatening to take actions they can’t take or don’t intend to take. 

But if they tell you that they intend to sue you, you should take that seriously. 

State laws, have statutes of limitations, or limited time periods when creditors or debt collectors 

can file a lawsuit to collect a debt. These periods of time can be two years or longer; the period of 

time varies by state and by the type of debt. In some states, even a partial payment on the debt 

185 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
will restart the time period. You may want to consult an attorney or the applicable law in your 

state to know when the statute of limitations expires before making any payment on a debt. 

Knowing whether or not a debt collector is licensed is useful (though not all states require 

licenses) because if the debt collector isn’t conducting itself properly, you can contact the state 

licensing agency which in many cases is the state attorney general. 

186 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Example letter to a debt collector asking to verify the debt 

[Your name] 

[Your return address] 

[Date] 

[Debt collector name] 

[Debt collector address] 

Re: [Account number for the debt, if you have it] 

Dear [Debt collector name]: 

I am responding to your contact about a debt you are trying to collect. You contacted me 

by [phone/mail], on [date] and identified the debt as [any information they gave you 

about the debt]. Please supply the information below so that I can be fully informed: 

Why you think I owe the debt and to whom I owe it, including: 

 The name and address of the creditor to whom the debt is currently owed, the 

account number used by that creditor, and the amount owed. 

 If this debt started with a different creditor, provide the name and address of 

the original creditor, the account number used by that creditor, and the 

amount owed to that creditor at the time it was transferred. When you 

identify the original creditor, please provide any other name by which I 

might know them, if that is different from the official name. In addition, tell 

me when the current creditor obtained the debt and who the current creditor 

obtained it from. 

 Provide verification and documentation that there is a valid basis for 

claiming that I am required to pay the debt to the current creditor. For 

example, can you provide a copy of the written agreement that created my 

original requirement to pay? 

187 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 If you are asking that I pay a debt that somebody else is or was required to 

pay, identify that person. Provide verification and documentation about why 

this is a debt that I am required to pay. 

The amount and age of the debt, specifically: 

 A copy of the last billing statement sent to me by the original creditor. 

 State the amount of the debt when you obtained it, and when that was. 

 If there have been any additional interest, fees or charges added since the last 

billing statement from the original creditor, provide an itemization showing the 

dates and amount of each added amount. In addition, explain how the added 

interest, fees or other charges are expressly authorized by the agreement 

creating the debt or are permitted by law. 

 If there have been any payments or other reductions since the last billing 

statement from the original creditor, provide an itemization showing the dates 

and amount of each of them. 

 If there have been any other changes or adjustments since the last billing 

statement from the original creditor, please provide full verification and 

documentation of the amount you are trying to collect. Explain how that amount 

was calculated. In addition, explain how the other changes or adjustments are 

expressly authorized by the agreement creating the debt or permitted by law. 

 Tell me when the creditor claims this debt became due and when it became 

delinquent. 

 Identify the date of the last payment made on this account. 

 Have you made a determination that this debt is within the statute of limitations 

applicable to it? Tell me when you think the statute of limitations expires for this 

debt, and how you determined that. 

188 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Details about your authority to collect this debt. 

 I would like more information about your firm before I discuss the debt with 

you. Does your firm have a debt collection license from my state? If not, say why 

not. If so, provide the date of the license, the name on the license, the license 

number, and the name, address and telephone number of the state agency 

issuing the license. 

 If you are contacting me from a place outside my state, does your firm have a 

debt collection license from that place? If so, provide the date of the license, the 

name on the license, the license number, and the name, address and telephone 

number of the state agency issuing the license. 

I have asked for this information because I have some questions. I need to hear from 

you to make an informed decision about your claim that I owe this money. I am open to 

communicating with you for this purpose. In order to make sure that I am not put at 

any disadvantage, in the meantime please treat this debt as being in dispute and under 

discussion between us. 

In addition to providing the information requested above, please let me know whether 

you are prepared to accept less than the balance you are claiming is owed. If so, please 

tell me in writing your offer, with the amount you will accept to fully resolve the 

account. 

Thank you for your cooperation. 

Sincerely, 

[Your name] 

You can ask a debt collector to stop contacting you 

The following example letter tells the debt collector to stop contacting you unless they can show 

evidence that you are responsible for this debt. Stopping contact does not cancel the debt. So, if 

the debt collector still believes you really are responsible for the debt, they could still take other 

189 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

action. For example, you still might be sued or have the status of the debt reported to one or all 

of the three credit reporting agencies—Equifax, Experian, and TransUnion. 

You may not want to make a request to stop contact if the debt is your home 

mortgage. If you ask your mortgage servicer to stop contacting you, the servicer will not have 

to reach out to tell you about options that you may have to avoid foreclosure. 

Example letter 

[Your name] 

[Your return address]
 

[Date]
 

[Debt collector name]
 

[Debt collector Address]
 

Re: [Account number for the debt, if you have it]
 

Dear [Debt collector name]: 

I am responding to your contact about a debt you are attempting to collect. You
 

contacted me by [phone/mail], on [date]. You identified the debt as [any information 

they gave you about the debt]. 

Please stop all communication with me and with this address about this debt. 

Record that I dispute having any obligation for this debt. If you forward or return this 

debt to another company, please indicate to them that it is disputed. If you report it to a 

credit bureau (or have already done so), also report that the debt is disputed. 

Thank you for your cooperation.
 

Sincerely, 

[Your name] 

190 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Resources 

Consumer.gov, Coping with Debt: 

http://www.consumer.ftc.gov/articles/0150-coping-debt 

MyCreditUnion.gov, Pocket Cents: 

http://www.mycreditunion.gov/what-credit-unions-can-do/Pages/paying-off-CreditCards.aspx 

StudentAid.ed.gov, Repay Your Loans: http://studentaid.ed.gov/repay-loans 

Medicare.gov, 4 Programs that Can Help You Pay Your Medical Expenses: 

http://www.medicare.gov/Pubs/pdf/11445.pdf 

CFPB.gov, Know Before You Owe: 

http://www.consumerfinance.gov/knowbeforeyouowe 

If you have a medical emergency you cannot afford, visit your state department of health 

and human services listed here: 

http://www.hhs.gov/recovery/statewebsites.html 

If you would like help managing your debt or rebuilding credit, visit the National 

Foundation for Credit Counseling: http://www.nfcc.org 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/complaint 

191 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

192 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
MODULE 12: 

Understanding credit reports 

and scores 

What are credit reports? 

A credit report is a consumer report that looks at some of your bill paying history, public record 

information, and a record of your applications for credit. Your credit reports shows information 

about how you have used credit, such as how much credit you have, how much of your available 

credit you are using, whether you have made your payments on time, and whether anyone has 

sent a delinquent (late) debt you owe to a debt collector. 

Why do credit reports and scores matter? 

Some people think credit reports and scores don’t matter to them, because they never want to 

get a loan. But many people and businesses use reports and scores to make decisions about you. 

 A bank or credit card will use them to decide whether to give you a loan or offer you a 

credit card. 

 A credit card company may use them to decide what interest rate you will pay on your 

future charges if you are approved. 

 A landlord may use your reports or scores to determine whether to rent an apartment to 

you. 

 In many states, an insurance company may use your reports or scores to determine 

whether to give you insurance coverage and the rates you will pay for coverage. 

193 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Other service providers, like cell phone and utilities companies, may use them to screen 

you for deposit levels and cost of service. 

 A potential employer may use your reports to determine whether you will get a job. 

(Note: According to the credit reporting agencies, actual scores are not used by 

employers. A special version of the credit report is used by employers.) 

 An existing employer may use your reports to determine whether you will get a 

promotion. 

Having a positive credit history and good credit scores can open doors for you. Not having a 

positive credit history or good credit scores can create obstacles for you and end up costing you 

more money in terms of the price you will pay for loans, credit cards, and other services. 

That’s why it’s important to pay bills on time and pay attention to what’s in your credit report. 

The score is calculated based on the information in the report – so take the time to make sure 

the information in your report is accurate. 

What is in a credit report? 

Companies collect information about consumers from many sources called information 

furnishers. These companies organize this information into reports and then sell these reports to 

businesses so they can make decisions about you. The biggest companies, called nationwide 

credit reporting agencies or credit bureaus, that create credit reports include Equifax, Experian, 

and TransUnion. Each of these companies is likely to have a file on you. Your files at all three are 

likely to be similar, but there may be differences. 

A credit report contains five sections. These sections include: 

 Header/identifying information—This includes your name and current address, as 

well as other information that can be used to distinguish or trace your identity, either by 

itself, like your Social Security number, or when combined with other personal 

information, including date and place of birth. This information may not be complete— 

all of the jobs you have held, for example, may not be listed. But what is listed should be 

accurate. A credit report does not include some personal information such as race or 

ethnicity. 

194 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Public record information—This section includes public record data of a financial 

nature, including consumer bankruptcies, judgments, and state and federal tax liens. 

Records of arrests and convictions generally do not appear on your credit file, but other 

types of consumer reporting agencies, such as employment background screening 

agencies, often include them. Other public records that usually do not appear in credit 

reports are marriage records, adoptions, and records of civil suits that have not resulted 

in judgments. 

 Collection agency account information—This section will show if you have or have 

had any accounts with a collection agency and the status of those accounts. 

 Credit account information —This section may include accounts you have now or 

that you had before with creditors. This includes the company name, account number, 

date opened, last activity, type of account and status, date closed if the account is no 

longer open, credit limit, items as of date (any amount currently owed and whether you 

are current or late with payments) and the balance, whether you have a past due amount, 

and the date information was reported to the credit bureau. Some accounts may not be 

listed, especially older accounts or those you have closed. So there may be 

inconsistencies across credit files and credit reporting agencies in the contents of this 

section. It is important to make sure what is listed, however, does or did belong to you. 

 Inquiries made to your account—Companies look at your credit report when you 

apply for credit, when they review your account, or when they offer you a special 

promotional rate. When you apply for credit and a lender reviews your credit report, it is 

listed as an “inquiry” on your report. Promotional inquiries, periodic reviews of your 

credit history by one of your creditors, and your requests for a copy of your report aren’t 

listed as an “inquiry.” 

In general, negative information can be reported to those who request your credit report for only 

a specified period of time—seven years for most items. A bankruptcy can stay on your credit 

report for 10 years, and certain other court records can be reported on your credit report for 

longer than seven years. For civil suits and judgments, as well as arrest records, the information 

can be reported on your credit report for seven years or for the duration allowed by the statute of 

limitations, whichever is longer. For criminal convictions, there’s no time limit. There is no limit 

to the length of time that positive information can stay on your credit report. 

Even though the information is not able to be reported beyond the limits provided in the Fair 

Credit Reporting Act, the credit reporting agencies may continue to keep the information in your 

195 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
file. Why? Because there is no time limit in terms of reporting information (positive or negative) 

when you are: 

 Applying for credit of $150,000 or more 

 Applying for life insurance with a face value of $150,000 or more 

 Applying for a job with an annual salary of $75,000 or more 

Companies collect this information and sell it to other businesses, which use it to make decisions 

about you. How do they use this information to make decisions? Businesses that use this 

information believe that how you have handled credit in the past is a good predictor of how you 

will handle credit in the future. If you have struggled with managing your credit in the past 

(especially the recent past), they believe you are likely to struggle again. 

Each of the three major credit reporting agencies—Equifax, Experian, and TransUnion—has its 

own presentation format. Here is an example of a credit report that highlights the key sections 

you will find in all three agencies’ credit reports. 

Negative information 

In general, negative information will be reported on your credit report for seven years. There are 

exceptions including: 

 Bankruptcy—Depending on the type of bankruptcy, up to 10 years 

 Tax Liens—seven years from the time the liens are paid 

 Account sent to collection or charged off —seven years plus 180 days from the 

delinquency 

 Criminal Convictions—Indefinite 

There is no time limit to the reporting of negative information when you are: 

 Applying for credit of $150,000 or more 

 Applying for life insurance with a face value of $150,000 or more 

 Applying for a job with an annual salary of $75,000 or more 

196 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Example credit report 

This is an example credit report and not based on the format of any one credit reporting agency. 

The italicized text explains what types of information are found in each section. 

It is for example purposes only. Readers should note that each credit reporting agency has its 

own format that will vary in layout, look, and level of detail reported. 

This example is fictional. The credit card payment schedule is based on a credit card with a 22% 

APR. In this example, the individual is paying down a high balance of $9,869, paying the 

minimum payment each month calculated at 4% of the balance, and not using the card to make 

additional purchases. While credit card companies use a variety of methods to determine 

finance charges, a simple interest calculation was used for the purposes of this example. 

Amounts were rounded to the nearest dollar. 

According to the credit card payment calculator on Bankrate.com, making the minimum 

payment of 4%, it will take the consumer 15 years and 3 months to pay off this credit card debt. 

The consumer will also pay $8,165 in interest assuming no late fees. 

197 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
File number: 12345678 Date issued: 9/30/2013 

Personal information 

This includes your name, current address, as well as other information that can be used to 

distinguish your identity by itself like your Social Security number, or when combined with other 

personal information, including date and place of birth. 

Name: Miguel Smith SSN: XXX-XX-1234 

Other names: Miguel S Smith Date of birth: 12-1-1980 

Miguel Simon Smith Telephone: 555-555-1000 

Addresses reported: 

457 First Street, Littletown, MI 09876 

13476 Avenue A, Big City, WI 43526 

Employment data reported: 

Employer name: Riviera Restaurants Position: Manager 

Date reported: 3/2013 Hired: 11/2010 

Employer: Freer Chiropractic College Position: Food services 

Date reported: 6/2008 Hired: 3/2008 

198 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Public records 

This section includes public record data of a financial nature, including consumer bankruptcies, 

judgments, and state and federal tax liens. 

Big City Wisconsin Court Docket# 200900001467 

515 C St, NE, Big City, WI 43528 

Date filed: 8/3/2009 Type: Chapter 7 Bankruptcy 

Amount: $11,987 Responsibility: Individual 

Big City Municipal Court Docket# 200700056712 

4326 Fourth Street, SW, Big City, WI 43530 

Date filed: 4/14/2007 Type: Civil Judgment 

Amount: $4,763 Responsibility: Individual 

Plaintiff: Bank of Big City Plaintiff attorney: Lisa Perry 

Collections 

This section will show if you have any accounts with a collection agency and the status of those 

accounts. 

Reliable collections (Y76381) Account# 3629 

Original creditor: ABC Megastore Amount placed: $2,500 

Opened: 7/2/2009 Account type: Open 

Balance: $1,000 Responsibility: Individual 

199 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

Account information 

This section includes accounts you have now or that you had before with creditors. 

Littletown Bank (B62391) Account# 2010004637 

Balance: $14,285 Pay status: 30 days past due 

Date updated: 8/30/2013 Account type: Automobile 

High balance: $16,500 Responsibility: Individual 

Past due: $395 Date opened: 2/5/2013 

Terms: $395/month 48 months 

Responsibility: Individual Payment received: $349 

Account type: Automobile Last payment made: 7/5/2013

Balance 

Scheduled 

Payment 

Amount Paid 

Past Due 

Rating 

8/5/13 

$14,285

$395 

$0

$395

30 

7/5/13 

 $14,680

$395 

 $395

 $0

OK 

6/5/13 

 $14,988

$395 

 $395 

$0 

OK 

5/5/13

 $15,294 

$395 

$395

$0

OK 

4/5/13 

$15,598

$395 

 $395 

$0 

OK 

3/5/13 

 $15,901 

$395 

$395 

$0 

OK 

200 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Bank of Wisconsin (B42394) Account# 543298760192XXXX 

Balance: $3,603 Pay status: Paid or paying as agreed Date updated: 8/3

Account type: Revolving; Credit Card High balance: $9,869 12/09 Responsibility: In

Credit limit: $10,000 Past due: $0 Date opened: 6/1/

8/2013 7/2013 6/2013 5/2013 4/2013 3/2013 2/2013 1/2013 

Balance $3,683 $3,764 $3,848 $3,933 $4,020 $4,109 $4,200 $4,29Scheduled Payment 

$147 $151 $154 $157 $161 $164 $168 $17

Amount Paid 

$147 $151 $154 $157 $161 $164 $168 $17

Past Due $0 $0 $0 $0 $0 $0 $0 $Rating OK OK OK OK OK OK OK O

 11/2012 10/2102 9/2012 8/2012 7/2012 6/2012 5/2012 4/2012 

Balance $4,485 $4,585 $4,686 $4,790 $4,896 $5,005 $5,115 $5,22Scheduled Payment 

$179 $183 $187 $192 $196 $200 $205 $20

Amount $179 $183 $187 $192 $196 $200 $205 $20Paid Past Due $0 $0 $0 $0 $0 $0 $0 $Rating OK OK OK OK OK OK OK O

201 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Inquiries made to your account 

This section includes a record of anytime a company requests information from a credit 

reporting agency about you. 

Inquiries that display to others 

The following companies have received your credit report. 

Auto Loan Store Requested on: 6/2013 

90 President Lane, Big City, WI 43529 

Super Store Requested on: 12/2012 

100 First Street, Anytown, IA 78691 

Promotional inquiries 

The following companies received your name, address and other limited information 

about your so they could make a firm offer of credit or insurance. They did not receive 

your full credit report. These are not displayed to others and do not affect your credit 

scores. 

Dress for Success Fashion House Requested on: 07/2012 

31 Fashion Lane, Big City, WI 43530 

EZ Loan Store Requested on: 4/2013 

220 4th Avenue, Littletown, MI 09876 

202 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Account review inquiries 

The companies listed below obtained information from your consumer report for the 

purpose of an account review of business transaction. These are not displayed to others 

and do not affect your credit scores. 

Bank of Wisconsin Requested on: 3/2013 

457 State Street, Big City, WI 43532 

Terms used on credit reports can be confusing. Here are the definitions of some key terms used 

on credit reports: 

Term Explanation 

A person permitted to use a credit card account, but who is not responsible for 

Authorized user the account. The payment status of the account (positive or negative) is shown 

on the credit report of both the authorized user and the account’s owner. 

The history of the account including on-time payments as well as delinquencies Payment status and other negative items. 

An account that has not been paid on time and is late. Generally delinquencies Delinquent are expressed as being 30, 60, 90, or 120 days or more delinquent. 

Default An account that has been delinquent (late) for several 30 day billing cycles. 

When a business decides an account is uncollectible. However, the consumer Charge off is still responsible for the debt, and collections will likely continue on this debt. 

The date an account is closed. An account can be closed by the business or 

Closed date the consumer. If there is still a balance when the account is closed, the 

consumer is still responsible for paying this. 

When the court releases a consumer of responsibility for a debt as part of the Discharge bankruptcy process. 

A legal process in which the consumer’s assets are used to pay off creditors. Chapter 7 Any eligible debts not paid through the assets are discharged. This will be in bankruptcy the public records section of the credit report. 

203 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Chapter 13 

bankruptcy 

A legal process in which a consumer enters into a payment plan to pay off 

creditors using future income. These are arranged by the courts. Once the 

payment plan is complete, remaining eligible debts are discharged. This will be 

in the public records section of the credit report. 

Dispute 

A right consumers have to challenge and require investigation of information 

they believe is incorrect on their credit reports. Consumers must initiate the 

dispute process. 

End user The business or individual that receives a credit report. 

Information 

provider or 

furnisher 

A business or individual that reports information to a credit reporting agency. 

Disputing errors on credit reports 

If you find something wrong on your credit report, you should dispute it. You may contact both 

the credit reporting agency (most often TransUnion, Equifax, or Experian) and the 

company that provided the incorrect information (the information furnisher). You 

will need to explain what you think is wrong and why. If you have evidence (a receipt for 

payment, copy of a cancelled check, etc.) you can include a copy of this and a copy of your credit 

report with the incorrect information highlighted. 

Never send original documents—only send copies. You may want to send this information with 

your letter using certified mail return receipt requested. This will give you notification of when 

the credit reporting agency and information furnisher receive your dispute letter. 

The credit reporting agency generally has 30 - 45 days to respond to your request from the time 

it receives it (and you will know this because of the return receipt you have). 

You can use this example dispute letter from the Federal Trade Commission to a credit reporting 

agency as a guide for writing your own letter. 

204 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Example letter 

[Your name] 

[Your return address] 

[Date] 

Complaint Department 

[Company Name]
 

[Street Address]
 

[City, State, Zip Code] 

Dear Sir or Madam: 

I am writing to dispute the following information in my file. I have circled the items I 

dispute on the attached copy of the report I received. 

This item [identify item(s) disputed by name of source, such as creditors or tax court, 

and identify type of item, such as credit account, judgment, etc.] is [inaccurate or 

incomplete] because [describe what is inaccurate or incomplete and why]. I am 

requesting that the item be removed [or request another specific change] to correct the 

information. 

Enclosed are copies of [use this sentence if applicable and describe any enclosed 

documentation, such as payment records and court documents] supporting my 

position. Please reinvestigate this [these] matter[s] and [delete or correct] the disputed 

item[s] as soon as possible. 

Sincerely, 

[Your name] 

Enclosures: [List what you are enclosing.] 

Be sure to keep copies of everything you send to the credit reporting agencies, 

including the dates you sent the items. 

205 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

You can contact the primary nationwide credit reporting agencies online, by mail, or by phone: 

Equifax 

Online: http://www.ai.equifax.com/CreditInvestigation 

By mail: Download and complete the dispute form: 

http://www.equifax.com/cp/MailInDislcosureRequest.pdf 

Mail the dispute form with your letter to: 

Equifax Information Services LLC 

P.O. Box 740256 

Atlanta, GA 30374 

By phone: Phone number provided on credit report or (800) 864-2978 

Experian 

Online: http://www.experian.com/disputes/main.html 

By mail: Use the address provided on your credit report or mail your letter to: 

Experian 

P.O. Box 4000 

Allen, TX 75013 

By phone: Phone number provided on credit report or (888) 397-3742 

TransUnion 

Online: http://www.transunion.com/personal-credit/credit-disputes-alerts-freezes.page 

By mail: Download and complete the dispute form: 

http://www.transunion.com/docs/rev/personal/InvestigationRequest.pdf 

Mail the dispute form with your letter to: 

TransUnion Consumer Solutions 

P.O. Box 2000, 

Chester, PA 19022-2000 

By phone: (800) 916-8800 

If the dispute results in a business changing the information it reported, the business must 

notify the credit reporting agencies to which it has provided the disputed information. And vice 

versa, if the consumer filed a dispute with a credit reporting agency, the agency must first fix the 

file and notify the creditor of the error. 

You can also submit a complaint to the Consumer Financial Protection Bureau. To do so: 

 Visit our website at http://www.consumerfinance.gov/complaint. 

206 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 Select the icon labeled “credit reporting.” 

 Complete and submit the online form. 

If you suspect that the error on your report is a result of identity theft, visit the Federal Trade 

Commission’s Fighting Back Against Identity Theft website for information about identity theft 

and steps to take if you have been victimized. This will include filing a fraud alert and possibly 

filing a security freeze. 

What are credit scores? 

Credit scores sum up key pieces of your credit history in a number at a moment in time—like a 

photograph. Companies that make credit scores each use their own complicated mathematical 

formulas to do this. The information used in this formula comes from your credit reports. The 

formulas are created by looking at how other people whose credit file looks like yours have paid 

their bills over time. 

Credit scores make it easier for businesses to make decisions about whether to do business with 

you. This is because scores provide a standardized way for businesses to understand the risk that 

you may not repay your loan. Without it, they would have to take the time to read and interpret 

your credit report. 

With credit scoring formulas, the higher the number, the less risky lenders believe you are likely 

to be. In fact, most credit scoring formulas say that you are unlikely to default on a loan if your 

credit scores are high. 

FICO scores (calculated using a formula made by Fair Isaac Corporation) are the most 

commonly used scores. These scores range from 300 to 850. People with the very best credit 

scores have FICO Scores of 750 and higher. A score above 700 is considered good by most 

businesses. According to the FICO Banking Analytics Blog, in 2012, just over 24% of the 

population had FICO scores below 600, 22% of the population had scores from 600 to 699, and 

53% of the population had scores of 700 or above.35 

35 FICO, FICO Scores Reflect Slow Economic Recovery, Bank Analytics Blog, September 18, 2012. See 

http://bankinganalyticsblog.fico.com/2012/09/fico-scores-reflect-slow-economic-recovery-.html. 

207 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Finally, it is important to note that you have more than one credit score – each agency generates 

a score, and they may differ from each other, sometimes significantly. In addition, an agency 

generates different scores for different kinds of users, and the score it sells to you may be 

another different score called an “educational score.” 

What goes into FICO scores? 

The actual way the FICO scores (and other scores) are calculated is considered a business secret. 

But we do know generally what makes up FICO Scores.36 

FIGURE 2: WHAT GOES INTO FICO SCORES? 

10% 

10% 

35% 

Payment history 

Amounts owed 

Length of credit history 

15% New credit 

Types of credit used 

30%
 

Payment history tracks whether you are paying your bills on time and as agreed. This is the 

biggest factor in your FICO Scores. Paying bills late, not paying bills at all, and having bills that 

go to collections will cause your scores to drop. The older this information is, the less impact it 

has on your scores. This is the reason is it more important to stay current with active accounts 

than it is to pay off old debts. Debts that have gone to collections have already damaged your 

scores. 

36 Pie chart values are from FICO. See http://www.myfico.com. 

208 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Credit utilization rate 

Credit scoring models penalize you for using too much of the credit you have available to 

you. This means your credit score may drop if you use more than 30% of the revolving 

credit you have available to you. The easiest way to understand credit utilization is 

through an example: 

If someone had a credit card with a $5,000 credit limit, and she had charged $3,500 on 

this card, her credit utilization rate is calculated as follows: 

$3,500 (amount charged to credit card) divided by $5,000 (credit limit) = .7 or 70% 

To figure out the maximum that she should charge on this card if she wants to maintain 

her credit score: 

$5,000 (the credit limit) multiplied by .3 (30%) = $1,500. 

Does this mean that only the unpaid balance is counted toward the credit utilization rate? 

The answer is no. If at any time during the month you use more than 30% of your 

available credit limit, you run the risk of your credit score dropping. 

If you know you have more than 30% of your credit limit charged on your card, you may 

want to get your credit utilization rate below 30% by paying down your credit card before 

you apply for new credit. 

Amounts owed includes whether you are paying down your loan balances as agreed. It also 

includes your credit utilization rate. Your credit utilization rate is how much of your available 

credit you are using. If you use more than 30% of your credit limits, your scores may drop. 

Length of credit history is the next factor that impacts your scores. Your score increases the 

longer you have a credit history. 

New credit tracks your inquiries. If you have too many inquiries, the model interprets this to 

mean you have a high demand for credit, which may be an indicator of risk, and your scores may 

drop. When you are shopping for a home,, car, or student loan, however, most models give you a 

209 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
short window of time when multiple inquiries can be made for some types of credit without 

causing your score to drop. 

Finally, types of credit used are considered. Your FICO scores increase if you have both credit 

cards (revolving credit) and loans (installment credit such as a mortgage or car loan). Generally, 

it is considered a positive to have a mortgage, an auto loan, and not too many credit cards. 

210 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 1: 

Getting your credit reports 

and scores 

Getting your reports 

Getting your credit report is the first step to improving your credit. It is important to think about 

credit, because a good credit history can help you: 

 Get and keep a job 

 Get security clearance for a job including a military position 

 Get an apartment 

 Get insurance coverage 

 Get better prices on cell phone plans and utilities 

 Get a credit card 

 Get loan from a bank or credit union including a loan for a house (a mortgage) 

 Get a better credit score—all of the information used to calculate your score comes from 

credit reports 

If any of these things are important to you, improving your credit report can help you get them. 

Start with your free annual report 

You can get a free copy of your report from each of three agencies every 12 months. 

Some states allow for an additional free report each year: Colorado, Georgia, Maine, Maryland, 

Massachusetts, New Jersey, Vermont and Puerto Rico. 

211 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

To order through the website, visit https://www.annualcreditreport.com. You will complete a 

form with basic information (your name, Social Security number, address, etc.). You will select 

the report(s) you want—Equifax, Experian, and/or TransUnion. 

Then for each report, you will be asked a series of security questions such as: former addresses, 

amount of a loan you have, phone numbers that have belonged to you, counties you may have 

lived in, etc. If you are unable to answer these questions, you will have to use another method. 

You will save a PDF version of your report, print the report, or both. 

Be sure you do this in a safe and secure location. Avoid doing this on public computers, such as 

those at a library. 

Alternative methods 

Order by phone: (877) 322-8228. You will go through a verification process over the phone. 

Order by mail: Download the request form from https://www.annualcreditreport.com. Print 

and complete the form. Mail the completed form to: 

Annual Credit Report Request Service 

P.O. Box 105281 

Atlanta, GA 30348-5281 

Use this table to track when you have printed or received your credit reports. 

Source of credit 

report 

Equifax 

PO Box 740241 

Atlanta, GA 30374 

(877) 784-2528 

www.equifax.com 

Experian 

(866) 200-6020 

www.experian.com 

TransUnion LLC 

PO Box 1000 

Chester, PA 19022 

(800) 916-8800 

www.transunion.com 

Date report printed or 

received 

Beware of imposter websites offering free credit reports. Some companies offer free credit 

reports, but you generally have to buy another product or service to get it. DO NOT use a search 

engine (Google or Yahoo, for example) to find the annual credit report site. Go directly to: 

https://www.annualcreditreport.com or go through http://www.consumerfinance.gov. 

212 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

You can get an additional free report if you: 

 Are unemployed and plan to look for employment in the next 60 days 

 Are receiving public assistance 

 Have been the victim of fraud including identity theft 

 Have had adverse action taken (you have been denied credit, employment, insurance, 

etc.) because of information in your credit report. In this case, you have 60 days to 

request your report. 

If you are under 18, you should not have a credit report unless: 

 You are an authorized user or joint owner on an account 

 You are an emancipated minor 

 Your state law allows you to enter contracts at 17 

 You have student loans 

 You have been the victim of identity theft and credit or financial fraud 

Currently, only Experian allows minors (once they reach the age of 14) to obtain their own credit 

reports. Call (888) 397-3742 to get your file. 

With TransUnion, you can send an email to childidtheft@transunion.com to see if a credit file 

exists. Or you can visit the TransUnion website and complete the Child Identity Theft Inquiry 

Form. If the minor has a legitimate credit history (he or she is the joint owner of or an 

authorized user on an account), then a parent or guardian must order the report. 

For the Equifax report, call (877) 784-2528. Currently, an adult—the parent or legal guardian— 

must order the credit report on behalf of the minor. 

Getting your credit scores 

Unlike your credit report, which you can get at no cost to you, you usually have to pay for your 

credit score. There are certain instances in which you are entitled to your credit score for free, 

for example if you are denied a loan on the basis of your credit score. 

213 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

There are many credit scores you can purchase in the marketplace. The type of credit score most 

used by lenders is a FICO score. Another score also used by lenders is the Vantage Score, which 

you can purchase through TransUnion. 

Credit scores offered online are approximations of your scores. They are not the actual scores 

businesses will use to make decisions about you. However, some people find they can be useful 

for education. You can generally see if your credit scores are moving up or down. But the actual 

number may not reflect your actual FICO Scores. So this may be confusing. 

You cannot know ahead of time whether the scores you purchase will vary moderately or 

significantly from a score sold to creditors. You should not rely on credit scores you purchase 

exclusively as a guide to how creditors will view you credit quality. Knowing what is in your 

credit report and fixing errors is more important to building your credit than 

buying a credit score that may not tell you what you need to know before you apply 

for a loan. 

To order your FICO score Equifax score: Date: 

visit 

http://www.myfico.com 

Each credit score will cost. Experian score: Date: 

This company also offers 

other credit reporting and 

monitoring services for a TransUnion score: Date: 

fee. 

You have the right to get a free credit scores if: 

 You apply for a mortgage loan and the lender uses your credit score. The lender must 

send you a notice telling you this and include your score. 

 Your application for credit is turned down or you have to pay a higher initial deposit for a 

service (cell phone plan for example). You will get a notice (disclosure) from the provider 

explaining this with your credit score. 

 You get less favorable terms from a lender than the terms available to most people who 

get credit from that lender. You will get a notice (disclosure) from the provider 

explaining this with your credit score. 

214 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

215 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 2: 

Credit report review checklist 

Once you get your credit report, you will want to review it carefully. Ordering it is not enough— 

you have to read it. Credit reports may have mistakes. And if there are mistakes, you are the only 

one who is likely to find them. 

Use the following worksheet to review each section of your credit report. Do this for each credit 

report you get throughout the year. Then, keep the completed checklist with your credit report. 

Your credit report contains a lot of personal and financial information. Be sure to keep any hard 

copies of your credit reports in a safe and secure place. If you do not want to hang on to your 

credit reports, be sure to shred them before getting rid of them. 

Today’s date: __________ Name of credit reporting agency ____________

 Checklist item 

Is your name correct? 

Is your Social Security number correct? 

Is your current address correct? Is your current phone number correct? 

Are the previous addresses they have listed for you correct? 

Is your marital status listed correctly? 

Is your employment history accurate? 

Is everything listed in the personal information section correct? 

Is there anything listed in the public record information? Is it correct? Highlight the 

information you think may not be correct. 

Review each item under the credit account (trade account) section. Are the accounts on 

the list still open? 

217 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Are all of the current balances correct? 

Are accounts where you are an authorized user or joint owner listed? 

Are zero balances recorded for debts discharged in bankruptcy? For debts paid in full? 

Are you listed as a co-signer on a loan? Is this correct? 

Are accounts that you closed listed as “closed by the consumer”? 

Is negative information reported on each credit account correct? Look for late payments 

and missed payments. Highlight those items you think are not correct. 

Are any accounts listed more than once? Check to make sure the same account is not 

listed multiple times in the collections section. 

Is old negative information still being reported? If yes, highlight the information that has 

exceeded the negative information reporting limit, which is usually seven years. 

Do you suspect that you have been the victim of identity theft after reviewing your credit 

reports? 

If you find something wrong with your credit report, you should dispute it. You may contact 

both the credit reporting company and the creditor or institution that provided the information. 

Explain what you think is wrong and why. 

To correct mistakes, it can help to contact both the credit reporting company and 

the source of the mistake. You may file a dispute not only with the credit reporting 

company, but also directly with the source of the information, and include the same supporting 

documentation. However, there are certain types of disputes that creditors and furnishing 

institutions are not required to investigate. 

You may file your dispute online at each credit reporting agency’s website. 

If you file a dispute by mail, see the example letter earlier in this module. Your dispute letter 

should include: Your complete name, address, and telephone number; your report confirmation 

number (if you have one); and the account number for any account you may be disputing. 

In your letter, clearly identify each mistake, state the facts, explain why you are disputing the 

information, and request that it be removed or corrected. You may want to enclose a copy of the 

218 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

portion of your report that contains the disputed items and circle or highlight the disputed 

items. Include copies (not originals) of documents that support your position. 

Send your letter of dispute to credit reporting companies by certified mail, return receipt 

requested, so that you will have a record that your letter was received. You can contact the 

nationwide credit reporting companies online, by mail, or by phone: 

You can contact the primary nationwide credit reporting agencies online, by mail, or by phone: 

Equifax 

Online: http://www.ai.equifax.com/CreditInvestigation 

By mail: Download and complete the dispute form: 

http://www.equifax.com/cp/MailInDislcosureRequest.pdf 

Mail the dispute form with your letter to: 

Equifax Information Services LLC 

P.O. Box 740256 

Atlanta, GA 30374 

By phone: Phone number provided on credit report or (800) 864-2978 

Experian 

Online: http://www.experian.com/disputes/main.html 

By mail: Use the address provided on your credit report or mail your letter to: 

Experian 

P.O. Box 4000 

Allen, TX 75013 

By phone: Phone number provided on credit report or (888) 397-3742 

TransUnion 

Online: http://www.transunion.com/personal-credit/credit-disputes-alerts-freezes.page 

By mail: Download and complete the dispute form: 

http://www.transunion.com/docs/rev/personal/InvestigationRequest.pdf 

Mail the dispute form with your letter to: 

TransUnion Consumer Solutions 

P.O. Box 2000, 

Chester, PA 19022-2000 

By phone: (800) 916-8800 

Keep copies of your dispute letter and enclosures. 

219 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

If you suspect that the error on your report is a result of identity theft, visit the Federal Trade 

Commission’s Fighting Back Against Identity Theft website for information about identity theft 

and steps to take if you have been victimized. This will include filing a fraud alert and possibly 

filing a security freeze. 

If the error is with a specific account, you can first contact the creditor (information furnisher) 

to resolve the dispute. 

Whether you file your dispute directly with the creditor (information furnisher) or the credit 

reporting agency, they generally have 30 - 45 days to investigate your claim and 5 days to send 

you written notice once their investigation is over. 

If the dispute results in a business changing the information it reported about you, the business 

must notify the credit reporting agencies. And vice versa, if you filed your dispute with a credit 

reporting agency, it must fix your file and notify the creditor of the error. 

Steps to filing a dispute 

Write a letter to the credit bureau that sent you the report. 

Provide the account number for the item you feel is not accurate. 

For each item, explain concisely why you believe it is not accurate. 

If you can, include copies of bills or cleared checks (money order stubs) that show you 

have paid them on time. 

Provide your address and telephone number at the end of the letter so the credit 

bureau can contact you for more information if necessary. 

Make a copy of your letter before you send it to the credit bureau. 

Send the letter. You may choose to use Certified Mail with Return Receipt to have 

proof of when the letter was received. The consumer reporting agency or the creditor 

generally has 30-45 days to investigate your claim. 

This tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

220 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this tool. CFPB recommends that you do not 

include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the tool that contain 

sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial information when 

no longer needed. 

221 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 3: 

Improving credit reports and 

scores 

Your credit report shows information about how you have used credit, such as how much credit 

you have, how much of your available credit you are using, whether you have made your 

payments on time, and whether anyone has sent a loan you owe to a debt collector. 

A credit score is a number that is used to predict how likely you are to pay back a loan. Your 

credit score starts with the information about you from your credit report. A mathematical 

prediction formula is applied to this information about you from your credit report. That 

prediction formula, which is called a scoring model, creates a number, and this number is your 

credit score. 

To get and keep a good credit score: 

 Pay all your loans on time 

 Make sure information in your credit report is correct 

 Don’t use too much of the credit that is available to you 

If you want to qualify for credit, focus on improving your reports and scores now. Use this 

worksheet to ensure you are focusing on the areas that matter most. 

223 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 if you Strategy for improving credit reports and scores Other 

plan to information or 

implement resources you 

need 

Obtaining free credit reports annually 

Online at https://www.annualcreditreport.com 

By phone: Call (877) 322-8228 

By mail: Go to https://www.annualcreditreport.com to print the 

form 

(Use Tool 1: Getting your credit reports and scores) 

Reviewing the credit reports for accuracy 

(Use Tool 3: Credit report review checklist) 

Disputing errors found on the reports 

(Use Tool 3: Credit report review checklist) 

Understanding Credit Scores 

(Use Tool 2: Getting your credit reports and scores) 

Paying bills on-time is the most effective way to improve your 

credit reports and credit scores. 

Keeping the amount of credit available that you use low. (While 

there is not an “official” published limit, many financial experts 

recommend keeping the amount of credit used between 25% 

and 30%37 of the credit available.) 

Keeping unused credit accounts open—credit card company 

may close account because of inactivity. (They are not allowed 

to charge fees if this occurs.) 

However, if your goal is paying down debt and you may be 

tempted to use the card, keeping the account open may not help 

you reach your goal. 

Developing a plan to take care of outstanding judgments or liens 

37 For two examples, see http://www.chicagotribune.com/classified/realestate/sns-201204201830--tms-­

realestmctnig-a20120428apr28,0,222450.column and http://www.experian.com/blogs/news/2012/09/24/rebuildyour-credit. 

224 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS
 

Diversifying credit sources 

Getting on payment plan for medical debt—ensure provider is 

not reporting balance as outstanding 

Asking for a “good will” deletion for an unusual late payment 

Negotiating with collection agency to “not report” in exchange for 

payment 

Paying down old debt or debt in collections 

Using credit building products 

Secured credit cards. This can be a way to build a positive credit 

history. But because credit limits tend to be low with these cards, 

be sure to watch your credit utilization rate and not get too close 

to using the full limit. 

Credit building loans. Visit a bank or credit union to find out 

about these products. With some credit builder loans, you make 

monthly payments first, and receive the loan amount when it is 

paid off. This helps you avoid taking on debt while you build a 

positive payment record. These loans can be very effective in 

creating new history and will have a positive impact on your 

reports and scores.

 Other: 

Resources 

FDIC.gov, Credit Repair: 

http://www.fdic.gov/consumers/consumer/ccc/repair.html 

Consumer.gov, Building a Better Credit Report: 

http://www.consumer.ftc.gov/articles/pdf-0032-building-a-better-credit-report.pdf 

225 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/complaint 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

226 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

MODULE 13: 

Evaluating financial service 

providers, products, and 

services 

Financial service providers 

Understanding financial products and services can be complicated, because there are so many 

people and businesses that provide financial services. Banks and credit unions probably come to 

mind first. But there are many other places that offer financial services. Here are a few: 

 Department stores—credit cards or charge cards 

 Automobile dealers—car loans 

 Retail superstores, convenience stores, grocery stores, and other stores—check 

cashing, bill payment, money orders, prepaid cards, and money transfers 

 Check cashers and payday lenders–check cashing, money transfers, bill payment, 

money orders, prepaid cards, and short-term loans 

 Online companies—money transfers, bill payment services, loans, financial 

management tools, online “wallets” or “accounts” 

 Mortgage companies—loans for homes 

 Commercial tax preparers—refund anticipation loans 

 Consumer finance companies–loans 

 U.S. Postal Service—money orders and money transfers 

227 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

The federal government issues student loans, offers savings bonds, and provides the Direct 

Express® card to recipients of federal benefits if they do not have a bank account. 

The key to finding the right financial service provider is figuring out the reason you need one. 

For example, you may want: 

	 A safe and secure place to put the money you are saving for your goals, unexpected 

expenses, or emergencies (see Module 4: Setting goals and Module 5: Saving for the 

unexpected, emergencies, and goals). 

	 A convenient way to pay your bills (see Module 6: Managing your cash flow). 

	 A loan to buy a car (see Module 11: Dealing with debt). 

	 A way to repair or build your credit history to improve your credit scores (see Module 8: 

Understanding credit reports and credit scores). 

Choosing financial products 

Financial products and services are the tools you can choose from to do all of these things and 

more. But selecting a financial service provider can be hard because there are so many choices in 

today’s marketplace. 

Use Tool 1: Selecting financial service products and providers to help you figure out the 

primary reason you need financial products or services. 

Then use Tool 2: Evaluating financial service providers to ensure you get the right questions 

answered before choosing a financial service provider. If you are not clear about the different 

kinds of financial service providers or the products and services they offer, use Tool 3: Types of 

financial services to learn more about them. 

If you feel you want to use a bank or credit union account, use Tool 4: Opening an account 

checklist. 

228 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Managing a bank account 

If you decide that you’d like to open a bank account, it is your responsibility to take care of it. 

This starts with learning the rules of your new account from your bank or credit union. When 

you do not follow the rules of your account, the bank or credit union may charge your fees. 

No one likes to see fees reducing their checking account balance every month. You may not be 

able to eliminate all the fees charged by your bank or credit union, but here are six steps to 

reduce the number or amount of fees you pay: 

1.	 Keep track of your balance to avoid spending more than you have available or going below 

your minimum balance requirement. 

For example: 

 Check your balance at the ATM before you withdraw cash. 

 Ask if your bank or credit union offers low-balance warnings via e-mail or text. 

 Ask your bank or credit union when the money you deposit will be available for your 

use. 

 Ask your bank how it processes debits to your account (debits are when money is 

taken out of your account). Debits are not always processed in the order in which 

they occur. 

 Monitor your account online, with text alerts, or with a mobile app. 

2.	 Find out if fees can be waived. Many financial institutions waive monthly service fees if 

you maintain a minimum balance or sign up for direct deposit. Compare fees. 

3.	 Watch out for overdraft fees. Overdrafts occur when you spend or withdraw more money 

than is available in your checking account. If you have more than one overdraft in a day, 

many banks and credit unions will charge you between $30 and $35 for each one. 

4.	 Use your financial institution’s ATMs. When you use ATMs in your bank’s network, there 

is generally no charge. Many banks or credit unions offer ATM locator maps on their 

websites and mobile apps. 

229 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

5.	 See if there’s a low-fee checking account for you, such as a senior or student account, or 

just a basic checking account with a low minimum balance requirement. This account 

may have a limited number of “free” checks and withdrawals. 

6.	 Open and review all of the mail from your bank or credit union. Review account 

statements every month to make sure they are correct and report errors immediately. 

You must also be notified when your minimum balance requirement, fees, or other 

account terms change. 

Finally, it is important to never knowingly write a check for funds you do not have in your 

account. This can create a number of problems for you. In addition to fees for nonsufficient 

funds from the bank or credit union and the merchant (if the check was written to a merchant), 

it could severely impact your ability to access financial services in the future. 

Federal insurance for financial institutions 

There are two agencies established by the federal 

government to make certain that the money people 

deposit in banks or credit unions will be there when 

the person wants to withdraw it. The Federal 

Deposit Insurance Corporation (FDIC) insures 

money in banks. The National Credit Union 

Administration (NCUA) insures money in credit 

unions. 

In general, the limit is $250,000 per depositor, per 

insured institution. So, if you have no more than 

$250,000 in a savings account in an insured bank 

and the bank fails, you will get all your money back. 

FDIC and NCUA do NOT insure money that people 

use to invest in stocks, mutual funds, life insurance 

policies, annuities, or other securities, even if they 

are purchased from a bank or credit union. 

How will you know if deposits in a bank or credit union are insured? You can look for these 

FDIC or NCUA logos. These will be on the door, displayed on the bank or credit unions websites, 

or on all materials from the bank or credit union. 

230 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Overdraft coverage programs 

An overdraft occurs when you spend or withdraw more money than is available in your 

checking account. Banks or credit unions can advance you money to cover the shortfall 

and charge you a fee. This is called sometimes overdraft coverage or overdraft protection. 

At its surface, overdraft programs can seem like they might be a good deal—they prevent 

people from being charged bounced or returned check fees by the merchant and the 

financial institution. But in reality, this protection can be expensive. The bank or credit 

union can charge you daily when you overdraw your account. And these fees can add up. 

Finally, you must pay the bank or credit union back for both the amount covered by the 

financial institution plus the fees. 

You can’t be charged a fee for an overdraft with your debit card unless you “opt in” to 

overdraft coverage and fees. (This is a relatively new law.) This means you have to actively 

choose to have it. If you have opted in previously, you can opt out now. 

Even if you don’t opt in, however, you can still be charged an overdraft fee if a recurring 

payment you have set up with your debit card number or via a direct billing arrangement 

overdraws your account. If you want to have a checking account and don’t want to pay 

overdraft fees, use one of these approaches: 

 Keep track of your balances. And remember, that not all deposits are available for 

use immediately. 

 Sign up for low balance alerts at your bank or credit union. 

 Know when regular electronic transfers, such a rent payments or utility bills, will 

be paid. 

 Link your checking account to your savings account. If you run out of money in 

your checking account, the bank will pull money out of your savings account. The 

fee for this is usually much lower than an overdraft fee. 

 Link your checking account to a credit card or line of credit. 

231 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

New remittance rules 

The Consumer Financial Protection Bureau has issued rules to protect consumers who send 

money electronically to foreign countries. These transactions are called “remittance transfers.” 

The new rules took effect on October 28, 2013. 

Background: A “remittance transfer” is an electronic transfer of money from a consumer in 

the United States to a person or business in a foreign country. It can include transfers from 

retail “money transmitters” as well as from banks and credit unions that transfer funds through 

wire transfers, automated clearing house (ACH) transactions, or other methods. 

Consumers in the United States send billions of dollars in remittance transfers each year. The 

Dodd-Frank Wall Street Reform and Consumer Protection Act established new standards with 

respect to remittance transfer and authorizing the Bureau to issue implementing regulations. 

Disclosures: The rules generally require companies to give disclosures to consumers before 

they pay for the remittance transfers. The disclosures must contain: 

 The exchange rate 

 Fees and taxes collected by the companies 

 Fees charged by the companies’ agents abroad and intermediary institutions 

 The amount of money expected to be delivered abroad, not including certain fees 

charged to the recipient or foreign taxes 

 If appropriate, a disclaimer that additional fees and foreign taxes may apply 

Consumers must also receive information about when the money will arrive and how the 

consumer can report a problem with a transfer. Instead of issuing a separate pre-payment 

disclosure and receipt, a company may provide a single combined disclosure before the sender 

pays for the transfer, so long as proof of payment is given when payment is made. 

Companies must provide the disclosures in English. Sometimes companies must also provide 

the disclosures in other languages. 

Other protections: The rules also generally require that consumers get 30 minutes (and 

sometimes more) to cancel a transfer. If it has not yet been received, consumers can get their 

money back if they cancel. 

232 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Companies must investigate if a consumer reports a problem with a transfer. For certain 

errors, consumers can generally get a refund or have the transfer sent again free of 

charge if the money did not arrive as promised. 

 Companies that provide remittance transfers are responsible for mistakes made by 

certain people who work for them. 

The rules also contain specific provisions applicable to transfers that consumers schedule in 

advance and for transfers that are scheduled to recur on a regular basis. 

Coverage: The rules apply to most remittance transfers if they are: 

 More than $15 

 Made by a consumer in the United States 

 Sent to a person or company in a foreign country 

This includes many types of transfers, including wire transfers. The rules apply to many 

companies that offer remittance transfers, including banks, thrifts, credit unions, money 

transmitters, and broker-dealers. However, the rules do not apply to companies that 

consistently provide 100 or fewer remittance transfers each year. 

233 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 1: 

Selecting financial service 

products and providers 

Selecting a financial service provider can be hard because there are so many choices. Before you 

decide which type of provider to use, think about the reasons you need a financial product. 

Here is a checklist of common reasons to find a financial service provider. Pick the top three 

reasons for you. 

Ranking Reason for a financial service provider 

I want a safe and secure place to keep my money. 

I want to be able to make purchases without having to carry cash. 

I want a low cost and easy way to pay and manage my bills. 

I want to pay bills, manage my finances, or conduct other transactions online. 

I want to have my paycheck directly deposited. 

I want to accumulate savings. 

I want to save for retirement, my children’s education, or other life events. 

I want to buy a car. 

I want to buy a home. 

I want to be able to get small loans quickly and without a hassle. 

I want to build my credit history. 

I want to send money to someone. 

235 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

On this chart, find the three reasons you identified above. Circle them and read about the 

financial service providers and products that may be the best fit for your priorities. 

Reason for a financial 

service provider Financial service provider Products that can meet your need 

I want a safe and Bank or credit union Savings account, checking account, or 

certificate of deposit 

secure place to keep 

my money. Retailer, check cashing store Prepaid debit card (if set up so that the 

or online individual funds are fully insured by FDIC) 

I want to be able to 

make purchases Bank or credit union Debit card (attached to a savings or 

checking account) 

without having to 

carry cash or go into 

debt. 

Retailer, check cashing store, 

or online Prepaid debit card 

Checking account 

Bank or credit union Bill payment services 

Money orders 

I want a low cost and 

easy way to pay my Money orders 

bills. Retailer, check cashing store, Bill payment services 

or online Prepaid debit cards (some can be used 

for bill payment) 

U.S. Postal Service Money orders 

Bank or credit union Checking account and online banking 

I want to bank and 

pay bills online. 

Internet-based bill paying 

service Online bill paying 

Retailer, check cashing store, Prepaid debit card with online bill 

or online payment 

236 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Bank or credit union Savings account or checking account 

I want to have my 

paycheck directly Employer Payroll card (prepaid debit card) 

deposited. Retailer, check cashing store, 

or online Prepaid debit card 

I want to accumulate 

savings. Bank or credit union Savings account or certificate of deposit 

I want to save for 

retirement, my 

children’s education, Bank or credit union Savings account, certificate of deposit, 

and investment accounts 

or other life events. 

Bank or credit union Car loan 

I want to buy a car. 

Automobile dealer Dealer financing 

Bank or credit union 

I want to buy a home. 

Mortgage company 

Mortgage 

Credit card company Credit card 

Pawn shop Pawn loan 

I want to be able to 

get loans quickly and 

without a hassle. 

Some Credit Unions and 

Banks 

Deposit advance loans (requires a bank 

account) 

Finance company Signature loan 

Payday loan provider Payday loan (requires a bank account) 

Bank or credit union Credit builder loan 

Bank or credit union Loan for an asset (car, home, etc.) 

I want to build my Credit builder loan 

Other lenders credit history. Credit card 

Secured credit card 

Credit card company 

Credit card 

237 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Retailer, some check cashing 

stores, U.S. Postal Service, Money Transfers I want to send money online companies to someone. 

Bank or credit union Wire Transfers or other money transfers 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

238 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

Tool 2: 

Evaluating financial service 

providers 

Once you know the reasons you want a financial product or service and have identified possible 

providers, use the following tool to compare businesses that can offer you those services. Using 

this form, you can compare up to three financial service providers at time. If there are services 

that don’t matter to you, just put a line through the entire row. 

Financial 

service 

provider 1: 

__________ 

Financial 

service 

provider 2: 

__________ 

Financial 

service 

provider 3: 

__________ 

Convenience and access 

Close to where I work or live? 

Open during hours I can visit (at lunch and after 

work, for example)? 

Can I pay bills and check balances by phone, 

online, or with a mobile app? 

Products and services 

Does it offer depository services? (savings, 

checking, CDs) 

If I get a checking or savings account, will I get 

an ATM card? Debit card? 

Does it offer credit services? (credit cards, 

small dollar loans, mortgages, lines of credit) 

239 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

 

Does it offer transactional services? (check 

cashing, money transfers, bill payment) 

Does it offer additional services? (Notary 

Public, safe deposit boxes) 

Customer service 

Do I feel welcome? 

Are the products and services described in 

terms I can understand? 

Are staff available to answer my questions in 

person or by phone? 

Safety and Security 

If I am depositing money, is it FDIC or NCUA 

insured? 

Is my money protected if someone steals my 

debit card or uses it without my permission? 

If I transfer money, will the provider guarantee 

the time it will arrive and give me information 

about the fees, taxes, and the exchange rate 

before I pay for the transfer? 

Fees 

Are there transaction fees or other costs, such 

as activity fees or, for international transactions, 

exchange rates? What are they? 

Is there a fee for making a deposit? 

Is there a fee for going below the minimum 

balance? 

Are there monthly account maintenance fees? 

Are there fees for using debit cards to make 

retail purchases or inactivity fees? 

240 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 

 

 

 

 

 

 

Are there fees for using online banking 

services? 

What are the fees if I overdraft? 

What are the fees associated with getting a 

loan? 

What are the fees associated with getting a 

credit card? Are there annual fees? 

Interest and statements 

Will I earn interest on savings? 

What is the rate of interest I will earn (APY)? 

What is the interest rate on the loan? 

What is the interest rate including all fees on 

the loan (APR)? 

How often will I receive account statements? 

Other criteria important to me 

If I am transferring money, how convenient is it 

for the recipient to receive the funds? 

If I am borrowing money, how much will my 

payment be? When is it due? 

Other: 

Other: 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

241 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

242 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Tool 3: 

Types of financial services 

Part of selecting the right financial service provider is knowing what product(s) or service(s) you 

need. Use the following tool to learn more about the basic financial products or services that 

may be available to you. Identify the places in your community where you can get the products 

or services you are interested in.

 if you Common financial Description Where can you 

are products or services get this product 

interested or service in 

your 

community? 

Transaction or payment products or services 

Checking account Deposit money in and withdraw 

money from this account by writing 

checks or using a debit card. Suitable 

for frequent transactions. Many 

checking accounts include access to 

mobile and online bill pay. Always 

keep track of your account activity to 

ensure sufficient balances to cover 

payments and withdrawals and avoid 

overdraft fees. 

Check cashing Turn paychecks, government checks, 

or personal checks into cash, often 

for a fee. 

Debit card You can use this card to make 

purchases at businesses (like 

grocery stores and gas stations) with 

money in your checking account. You 

can also use this card to make 

deposits to and withdrawals from a 

checking account at ATMs. 

243 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Automated teller Deposit in or withdraw money from a 

machine (ATM) card savings or checking account. You will 

often not be charged a fee if you use 

ATMs that are owned by your bank 

or credit union or within the same 

ATM network. Many ATM cards are 

also debit cards. An ATM card 

cannot be used to make purchases 

at businesses unless it is also a debit 

card. 

Prepaid debit card A card that you use to access money 

you have paid in advance. A prepaid 

card can refer to a number of 

different types of cards. Gift cards 

are prepaid cards that typically are 

used up after you deplete the value 

on the card. You can also buy 

prepaid debit cards that you can add 

money to (reload) and continue using 

over and over. Some types of 

prepaid cards also allow you to take 

money out at an ATM. Reloadable 

prepaid cards generally charge a 

monthly maintenance fee. Some 

charge for deposits or each time you 

use the card. Prepaid debit cards 

may carry fewer consumer 

protections in the event of loss or a 

disputed charge than debit cards. 

Money transfer Send money from one place to 

another. 

Bill payment services Use cash, a money order, a bank 

account, or another payment method 

to pay utility, mortgage, or other bills, 

in person, by phone, through a 

website, or through a mobile phone 

application. 

Money order Buy a money order to pay a business 

or other party; can be used instead of 

a check. 

244 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Depository products or services 

Savings account Deposit money in and withdraw 

money from an account; earn interest 

(currently interest rates are low). Not 

intended for frequent transacting. 

Certificate of deposit Deposit a fixed amount of money for 

a specific amount of time. Funds are 

generally inaccessible during the CD 

term unless you forfeit interest as a 

penalty. The size of the penalty 

varies, and could amount to more 

than the interest you have earned if 

you withdraw the money before the 

maturity date. Generally earns more 

interest than savings. 

Credit products or services 

Credit card Borrow money up to an approved 

credit limit. Make purchases using 

the card or the number and card 

security code. A minimum monthly 

payment is required. Will be charged 

interest on unpaid amounts; can be 

charged other fees based on terms of 

contract. 

Line of credit Borrow money up to an approved 

credit limit. Getting approved for a 

line of credit is different from a credit 

card. It may be secured with 

collateral (such as a home), or be 

unsecured. Can be used for overdraft 

protection in a checking account. 

Car loan Borrow money to buy a used or new 

car. This will be an installment loan. 

The car will generally be pledged 

against the loan (collateral). 

245 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Business loan Borrow money to start or expand a 

business. This will be an installment 

loan. Equipment or other business 

assets, or personal assets may be 

pledged against the loan (collateral). 

Mortgage Borrow money to build or buy a 

home. This will be paid back in 

installments. The home will generally 

be pledged against the loan 

(collateral). 

Credit building products or services 

Secured credit card Borrow money up to a limit that is 

secured by a deposit. This deposit 

acts as collateral if you do not pay 

the credit card as agreed. 

Credit building loan Borrow money specifically to improve 

credit scores. This may be available 

at banks or credit unions in your 

community. 

Other products or services 

Small dollar / 

Signature loan 

Borrow small amounts of money. 

Generally, the loans have to be paid 

back quickly and the interest rate and 

fees are higher than bank or credit 

union loans or credit cards. 

Payday loan Borrow small amounts of money. You 

provide a check written for some time 

in the future—generally two weeks. If 

you don’t repay the loan and fees in 

full, the lender can cash the check. If 

your account does not have enough 

money in it to cover the amount, you 

may have to take out a new loan for 

the amount you don’t repay. 

246 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Pawn shop loan Borrow money against an item. If you 

do not pay back the loan as agreed 

or renew the loan, the pawn shop 

can sell the item to cover the debt. 

The loan amount is often much less 

than the item is worth. 

Car title loan Borrow money against your car. If 

you do not pay back the loan as 

agreed or renew the loan, the car can 

be sold to cover the debt. The loan 

amount is often much less than the 

car is worth. 

Technology-based services 

Online banking Manage your bank or credit union 

account through a secure website. 

This option may include a method to 

pay bills from your account, and is 

available through many banks and 

credit unions. 

Mobile banking Use your smart phone to manage 

accounts and make payments 

through your bank or credit union’s 

website or mobile application. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

247 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

 

Tool 4: 

Opening account checklist 

Opening an account at a bank or credit union38 

If you decide that a checking or savings account is the right product for you, opening an account 

at a bank or credit union is really quite simple. 

First, you may want to get a recommendation from a trusted friend or family member for a bank 

or credit union. Find out about: 

 The services they offer 

 The interest they pay for savings accounts 

 The fees they charge 

You will usually need between $25 and $100 to open a savings or checking account. Be sure to 

find out how much you must keep in the account at all times to avoid fees. This is 

called the “minimum balance requirement.” This may not be the same amount of money 

you need to open the account, so it’s important to ask. 

You will also need two forms of identification to open an account. Some banks or credit unions 

will take one form of identification and a bill with your name and address on it. You will usually 

be required to present: 

 A U. S. government or state issued form of identification with your photo on it, such as a 

driver’s license, U. S. Passport, or military identification 

and one of the following: 

38 From Take it to the Bank: Your Guide to Opening a Bank Account produced by the Community Affairs Office of the Federal 

Reserve Bank of Dallas and Texas Appleseed. 

249 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Your Social Security card 

 A bill with name and address on it 

 Your birth certificate 

If you do not have a U. S. government-issued form of identification, some banks and credit 

unions accept foreign passports and Consular IDs, such as the Matricula Consular card, which is 

an official Mexican Government identification document. (Other countries, such as Guatemala 

and Argentina have similar IDs.) Consulates in the United State offer them. Visit your country’s 

consulate for more information about how to get an ID card, and with the banks and credit 

unions about whether they accept it. 

Interest-bearing accounts 

Interest is considered income. If you earn interest, you must pay taxes on it. In order to open an 

interest bearing account, such as a savings account, you must have a Social Security number or 

an Individual Taxpayer Identification Number (ITIN).39 Or, you must be able to show evidence 

that you have applied for an ITIN. 

If you do not have a Social Security number, you do not have an ITIN, or you have not applied 

for an ITIN, you can open a non-interest bearing account. 

Barriers to opening an account 

Not having the proper identification can be one barrier to opening an account. Another barrier is 

a potentially negative rating with specialty consumer reporting agencies like ChexSystems, 

TeleCheck, Early Warning, and others that report on checking accounts or banking histories. 

These agencies collect information from merchants, banks, and credit unions about how 

consumers manage savings and checking accounts. They do this for financial institutions that 

are a part of their network. Banks and credit unions use reports developed by these agencies to 

decide if someone can open a new account. You may have a negative rating if you or someone 

you had a joint account with has struggled with a checking or savings account in the past and: 

39 Internal Revenue Service. See http://www.irs.gov/Individuals/General-ITIN-Information. 

250 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

 Had a lot of bounced checks and non-sufficient funds (NSF) fees 

 Not paid debts and fees owed to a bank or credit union related to an account 

 Been suspected of fraud related to a checking account 

 Have had an account closed (involuntarily) by a bank or credit union within the last 12 

months 

Involuntary closures stay on your ChexSystems report for five years and on the Early Warning 

System report for seven. Overdrafts remain on your consumer record for five years, even if you 

have paid back what you owe the bank or credit union. Each bank or credit union has its own 

policies about the way the information in your banking history report impacts your ability to 

open an account. This can include the amount of time that has passed since events like an 

involuntary closure or repeated overdrafts occurred. 

Some banks and credit unions require you to pay these old charges and fees before you are 

allowed to open a savings or checking account. In other cases, you may be offered the 

opportunity to open a “second chance” or checkless checking account that has different features 

and restrictions than standard checking accounts offer. Depending on the account’s rules, you 

may be allowed to open a standard checking account after six to twelve months if you have not 

over drafted or bounced any checks. 

You can order your own ChexSystems report online from ChexSystems at 

http://www.consumerdebit.com, call for more information at (800) 428-9623, or send a written 

request to: 

ChexSystems, Inc. 

7805 Hudson Road, Suite 100 

Woodbury, MN 55125 

You can order your TeleCheck Services Report by sending a written request to: 

TeleCheck Services, Inc.
 

Attention: Consumer Resolution – FA
 

P. O. Box 4514 

Houston, TX 77210-4515 

To request your Early Warning report, call (800) 325-7775. 

251 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
If you find mistakes, you can dispute these by sending a letter (you may choose to use certified 

mail) describing the mistake and copies of any evidence. 

Use this checklist to ensure you have what you need to open an account at a bank 

or credit union. 

Information needed Additional questions 

A U.S. or foreign government-issued form of 

identification with my picture on it. Note that each 

bank or credit union has its own policy on which 

foreign IDs it accepts. 

Another form of identification: 

Your Social Security card 

A bill with your name and address on it 

Birth certificate 

A Social Security number or ITIN (individual 

taxpayer identification number); if not, you may 

only be able to open a noninterest bearing 

account. 

Money to open the account 

Information about: 

Minimum balance required in the account to 

avoid monthly service fees 

Monthly service fees 

Per-check or transaction fees 

Fees associated with use of automated teller 

machines (ATMs) 

Internet banking access and any costs 

Online bill pay access and any costs 

Overdraft fees (see note that follows) 

252 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

 

Low balance alert notifications 

Other: 

Resources 

FDIC.gov, Credit Repair: 

http://www.fdic.gov/consumers/consumer/ccc/repair.html 

Consumer.gov, Building a Better Credit Report: 

http://www.consumer.ftc.gov/articles/pdf-0032-building-a-better-credit-report.pdf 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: http://www.consumerfinance.gov/complaint 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

This Tool may ask you to provide sensitive personal and financial information. The CFPB does not collect any information from you 

or the organization using this Tool. The CFPB is not responsible and has no control over how others may use the information that 

you provide to them about your personal or financial situation. Be cautious how you use this Tool. CFPB recommends that you do 

not include names, account numbers; that you lock up completed hard copies and encrypt completed soft copies of the Tool that 

contain sensitive personal and financial information; and shred hard copies that contain sensitive personal and financial 

information when no longer needed. 

253 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

MODULE 14: 

Protecting consumer rights 

Part of being a smart consumer is understanding your rights. When you know you have rights, 

you can protect yourself. There are many laws that protect your rights when it comes to financial 

products and services. It is the CFPB’s job to enforce these laws and handle consumers’ 

complaints about financial products and services. 

The CFPB has already handled thousands of consumer complaints about: 

 Credit cards 

 Mortgages 

 Bank accounts and services 

 Private student loans 

 Vehicle or consumer loans 

 Payday loans 

 Debt collection 

 Money transfers 

 Credit reporting 

Based on these complaints and research, the CFPB takes action to stop practices that are unfair, 

deceptive, abusive, or otherwise violate the law. In many cases, we partner with other federal 

agencies and state officials to address these problems. 

Through our enforcement actions, the CFPB can require companies to refund money to 

customers when their consumer rights have been violated. 

255 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

Consumer complaints 

Submit a complaint 

To submit a complaint, go to: http://www.consumerfinance.gov/complaint. From there, select 

the product or service that your complaint is about, for example: bank account or service, credit 

card, credit reporting, debt collection, money transfer, mortgage, student loan, payday loan, 

money transfers, or vehicle/consumer loan. 

Fill out the form, providing as much detail as possible. 

You will then be able to review and edit any information before clicking “Submit” to send your 

complaint. If you need help while you’re online, click on the link that says “Form Trouble? Chat 

now.” to talk with CFPB team members on the site. 

If you don’t use a computer or need help in a language other than English, you can also submit a 

complaint over the phone by calling the CFPB at (855) 411-CFPB (2372), toll free. U.S.-based 

call centers can help you in over 180 languages and can also take calls from consumers who are 

hearing impaired or speech-disabled. 

Para presentar una queja en español, llamar al (855) 411-2372. 

If you want more information on how complaints are handled, you can read the Privacy Impact 

Assessment for the Consumer Response System available at 

http://www.consumerfinance.gov/privacy-office/consumer-response-database/. 

What happens when I submit a complaint? 

Tool 3: Submitting a complaint provides detailed information on how to submit a complaint, 

and how you can track the process. 

CFPB screens the complaints it receives and forwards them via a secure web portal to the 

appropriate company—the business you have the complaint with. 

The company has 15 days to provide a substantive response to you and to the CFPB. Companies 

are expected to close all but the most complicated complaints within 60 days. 

256 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
CFPB then invites you to review the response and provide feedback. The CFPB reviews your 

feedback about company responses and uses this information along with other information such 

as the timeliness of the company’s response, for example, to help prioritize complaints for 

investigation. 

Complaints help with the CFPB’s work to supervise companies, enforce federal consumer 

financial laws, and write better rules and regulations. The CFPB also reports to Congress about 

the complaints we receive and makes anonymized consumer complaint data available to the 

public on its website: http://www.consumerfinance.gov/complaintdatabase. 

It’s your money—be aware and take care 

It’s your money. Ask questions. 

It can be hard to ask about financial planning or products. 

 Don’t be intimidated. 

 If you want to work with a financial counselor or adviser, interview a few before choosing 

one. 

 Before you sign anything or give personal or financial information about yourself to an 

adviser, ask questions: What are your qualifications? How do you get paid? Are you 

working in my best interest? 

 If your friends or family members give you advice or information, it’s up to you to 

question them: Where did you get the information? Who gets paid what? Are you making 

any money on this? 

“I have an amazing opportunity, just for YOU!” 

Have you ever seen or heard something like this? Most of us have, such as in an email offering 

us an opportunity to receive millions of dollars from a foreign prince or a lottery you did not 

enter, or in potential jobs that say you can earn $80/hour while working at home. 

Unfortunately, if the "opportunity" appears too good to be true, it probably is. If you run across 

an amazing sounding opportunity, job, or product, do your research with a critical eye. 

Especially if you are receiving the “opportunity” via an unsolicited email! 

257 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 

In general, 

 Beware of promises to make fast profits and investments that claim to offer high returns 

at little or no risk. 

 Do not invest in anything unless you really understand the deal fully. Consider running 

the opportunity by others that you trust to make sure that they share your 

understanding. 

 Don't assume a company is legitimate based on "appearance" of the website. 

 Beware of requests for money from people you do not know. Research the parties 

involved and the nature of the deal or job. If you don’t know how to do this, ask someone 

that you trust to help you, or don’t deal with that person! 

 Contact state and local consumer agencies to see if there is a complaint against the 

company. 

 Don't open spam. Delete it unread and never respond to spam. 

 Don’t open e-mail attachments from people you don’t know or attachments that you did 

not expect to receive. 

It’s your money. You can say no. 

Scammers target polite people because they have a harder time saying no. 

 If you feel pressured to make a decision, chances are you are being scammed. 

 It may be hard, especially if it is a friend or relative, but just saying “No, I am not 

interested,” may save you from a financial loss. 

 You don’t have to stay on the telephone line if you feel uncomfortable. Tell them to take 

you off their list and then HANG UP. 

It’s your information. Take care of it. 

Never give out personal information, such as account numbers, passwords, or answers to 

security questions, over the phone or through email unless you know the company and you 

initiated the call or directly typed in the website address and you see signals that the site is 

258 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
secure, like a URL that begi ns with “https.” Telephone and online scams are common and 

constantly changing, so you have to be proactive and protect yourself. It may be hard to believe 

it’s a scam when you get a call from someone far away that needs help or tells you that your 

family member needs help. But it usually is. 

You can prevent identity theft by guarding your identifying information carefully and only 

sharing it with a few trusted people. Use the checklist in Tool 2: Protecting your identity to 

make sure you are taking the right precautions in protecting your identity. 

259 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 1: 

Red flags 

When making purchasing decisions, watch out for the following red flags. Use this checklist 

when you are considering a product or services. If you find you have checked one or more of 

these items, be sure to take a closer look at the product, the service, or the business that offers it. 

Red flag Description 

Sales tactics and red flags for loans and other financial products or services 

Pressured sales 

tactics 

You are pressured to purchase things or to take out loans you 

don’t want or can’t afford. 

Lack of uniformity Different staff or salespeople are telling you different things 

regarding pricing or other information. 

Won’t put it in writing No one will give you clear information in writing—even when you 

ask for it. 

 Unexplained fees No one can explain what certain fees are for or why they are so 

high. 

No clear cancellation 

or return policy 

There’s no clear cancellation or return policy. Don’t assume that 

you are able to return a product or cancel a purchase. 

Inconsistent 

information on interest 

rates 

The salesperson tells you about an interest rate, but the APR on 

the form is much higher. 

Pushed to purchase You are being pushed to make a big-ticket purchase immediately. 

 Steering and coercing 

Aggressive sales tactics are used to steer and coerce you toward a 

high cost loan, even though you could have qualified for regular 

prime loans. 

261 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Red flags when signing loan documents 

Paperwork doesn’t 

match the sales pitch 

The promises made to you by a salesperson are not in the papers 

that you are asked to sign. 

 Confusing fine-print A good rule of thumb is to refuse to sign anything that you don’t 

understand. 

 Incomplete paperwork You are asked to sign a contract with blank spaces to be filled in 

later. 

Additional insurance 

and other add-on 

products 

Some lenders may insist on, intimidate, or imply that borrowers 

must buy unnecessary items—additional insurance, unneeded 

warranties, monitoring services, etc. They get incorporated into the 

loan amount, and the borrower pays interest on them over the life 

of the loan. 

 Prepayment penalties Prepayment penalties are fees lenders require a borrower to pay if 

the borrower pays off a loan early. 

 Mandatory arbitration 

Language is included in the fine print of the loan terms and 

conditions making it illegal for the borrower to take legal action 

against the lender. The loan documents require the borrower to 

submit to arbitration. Borrowers can find it difficult to find legal 

representation for mandatory arbitration proceedings. 

This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

262 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

Tool 2: 

Protecting your identity 

Though it might not seem like it, your identity is one of the most precious things you possess. 

Criminals who are able to steal your identifying information can pretend to be you, buying 

things on accounts that you own or are under your name. This leaves you getting their bills! It 

can also create problems with your credit reports and scores. 

Identifying information is anything that is specifically unique to you, such as your: 

 Credit card and bank account numbers 

 Driver’s license number 

 Date, city, and state of birth 

 Social security number 

 Passwords or PIN numbers 

Many people think that identity theft happens primarily online, and if you don’t shop online, 

you are safe. The reality is that most identity thefts take place offline—just the opposite of what 

many people think. In addition, in over half of the cases of identity theft, the thief is someone 

that the victim knows. Because of this, it’s important to be cautious with your identifying 

information–both online and in the real world. 

Steps to protect your identity 

Check your credit report 

Remove your name from all three credit bureaus’ (Equifax, Experian, and TransUnion) mailing 

lists by calling to opt-out at (888) 567-8688 or online at http://www.optoutprescreen.com – 

choose “forever” removal option. This prevents prescreened offers from falling into other 

people’s hands. 

263 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Check your credit at all three credit agencies each year using the free 

https://www.annualcreditreport.com. If you see anything that is incorrect or suspicious, contact 

them immediately. (See Module 12: Understanding Your Credit Reports and Scores for more 

information). 

Limit access to your information 

Don’t carry your Social Security card or number in your wallet or purse. 

Remove your name from many direct mail marketers’ lists by registering with the Direct 

Marketing Association online form at http://www.dmachoice.org. Removing your name from 

marketers’ lists will create fewer opportunities for thieves to steal your information. 

Remove yourself from most telemarketers’ lists by registering your phone number with the Do 

Not Call Registry at (888) 382-1222 or at http://.www.donotcall.gov. Numbers registered after 

February 2008 remain permanently on the National Do Not Call Registry. 

Never give your personal information to someone who calls you and asks for it, even if they say 

there are from your financial institution. 

Use a shredder, scissors, or your hands to tear all papers with identifying information or 

account numbers into tiny pieces before throwing them out. 

Give out your Social Security number only when absolutely necessary. Often when someone 

asks for it, you are not required to give it to them. 

Practice online security 

Commit all passwords to memory. Never write them down or carry them with you (not even on 

a post-it by your computer!). 

Make sure passwords include upper- and lower-case letters, numbers, and do not include any 

words that can be found in a dictionary or names and dates that can be associated with you 

(your children’s names and birthdates, for example). Longer passwords are better. The best 

practice is to have a different password for each account. If you find it too hard to keep track of 

so many passwords, have separate, longer, harder-to-guess passwords for your financial 

accounts than for ordinary uses like your e-mail. 

Don’t give out your financial or personal information over the Internet, unless you have initiated 

the contact or know for certain who you are dealing with. 

Never share identity information online unless the site is secure with an encryption program so 

no one can intercept your information. If secure, the web site address will start with https, 

not http. There will also be a lock icon () in front of the web address. 

264 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
Do not reply to emails asking for personal banking information, even if they have a bank or 

PayPal logo! Financial Institutions will never ask for personal information via email. 

According to the Federal Trade Commission (FTC), identity protection means treating your 

personal information like cash or a valuable commodity—being careful not to leave it around, 

and being thoughtful about who is asking for it, why they need it, and how they’re going to 

safeguard it for you. 

This is the FTC’s list of common red flags that your identity has been stolen: 

 There are mistakes on your bank, credit card, or other account statements. 

 There are mistakes on the explanation of medical benefits from your health plan. 

 Your regular bills and account statements don’t arrive on time. 

 You get bills or collection notices for products or services you never received. 

 You receive calls from debt collectors about debts that don’t belong to you. 

 You get a notice from the IRS that someone used your Social Security number. 

 You receive mail, email, or calls about accounts or jobs in your minor child’s name. 

 You receive unwarranted collection notices on your credit report. 

 Businesses turn down your checks. 

 You are turned down unexpectedly for a loan or job. 

If you determine your identity has been stolen, the FTC recommends the following steps: 

1. Place a fraud alert on your credit file 

Call one of the nationwide credit reporting agencies, and ask for a fraud alert on your credit 

report. The company you call must contact the other two so they can put fraud alerts on your 

files. An initial fraud alert is good for 90 days. If you want to place an extended alert on your 

credit report after your identity has been stolen, you must file either a police report or a report 

with a government agency such as the FTC, known as an “identity theft report.” An extended 

alert is good for seven years. An extended alert requires that the creditor contact you in person 

265 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

or through the telephone number or other contact method you designate to verify whether you 

are the person making the credit request. 

 Equifax: (800) 525-6285 

 Experian: (888) 397-3742 

 TransUnion: (800) 680-7289 

2. Consider a security freeze 

You can also place a “freeze” on your credit report. A security freeze means that potential new 

creditors cannot access your credit report. Only a limited number of entities can see your file 

while a freeze is in place, including existing creditors, certain government entities like child 

support agencies, and companies that monitor your credit file at your direction to prevent fraud. 

Because most businesses will not open credit accounts without checking your credit report, a 

freeze can deter identity thieves from opening new accounts in your name. Be mindful that a 

freeze does not prevent identity thieves taking over existing accounts. Credit reporting agencies 

may charge for this service. In some states, identity theft victims are not charged to place a 

security freeze. 

3. Order your credit reports 

Each company’s credit report about you is slightly different, so order a report from each 

company. When you order, you must answer some questions to prove your identity. Read your 

reports carefully to see if the information is correct. If you see mistakes or signs of fraud, contact 

the credit reporting company. 

4. Create an identity theft report 

An Identity Theft Report can help you get fraudulent information removed from your credit 

report, stop a company from collecting debts caused by identity theft, and get information about 

accounts a thief opened in your name. To create an Identity Theft Report, first file a complaint 

with the FTC at ftc.gov/complaint or (877) 438-4338; TTY: (866) 653-4261. Your completed 

complaint is called an FTC Identity Theft Affidavit. Next, you can take your FTC Affidavit to 

your local police, or to the police where the theft occurred, and file a police report. Get a copy of 

the police report. The two documents comprise an Identity Theft Report. 

For more information from the Federal Trade Commission, visit: 

http://www.consumer.ftc.gov/features/feature-0015-identity-theft-resources. 

266 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

267 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

 

Tool 3: 

Submitting a complaint 

There are many laws that protect your rights when it comes to consumer financial products and 

services. One of the CFPB’s primary functions is to enforce several of these laws and handle 

consumers’ complaints about consumer financial products and services. 

The CFPB accepts complaints on consumer financial products and services such as: 

 Credit cards 

 Mortgages 

 Bank (checking and savings) accounts and services 

 Private student loans 

 Vehicle or consumer loans 

 Money transfers 

 Credit reporting 

 Debt collection 

 Payday loans 

To submit a complaint, go to: http://www.consumerfinance.gov/complaint. From there, select 

the product or service that the complaint is about, for example: bank account or service, credit 

card, credit reporting, money transfer, mortgage, private student loan, payday loans, debt 

collection, or vehicle/consumer loan. 

Instructions for a consumer to submit a complaint 

Fill out the form, providing as much detail as possible. The form will ask for pertinent 

information about the circumstances of the complaint and, in general, will: 

269 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 Ask you to describe what happened, in as much detail as possible 

 Ask you what you think a fair resolution to the issue would be. 

 Ask you for your information (name/address/email). 

 Ask for detailed information about the product and company you are complaining about. 

Please scan and upload any documentation that you have here (Account agreements, 

monthly statements, proof of payment, etc.). 

You will then be able to review and edit information before clicking “Submit” to send your 

complaint. 

If you need help while you’re online, click on the link that says “Form Trouble? Chat now.” to 

talk with CFPB team members on the site. 

If you don’t use a computer or need help in a language other than English, you can also submit a 

complaint over the phone by calling the CFPB at (855) 411-CFPB (2372), toll free. U.S.-based 

call centers can help you in over 180 languages and can also take calls from consumers who are 

hearing impaired, or speech-disabled. 

Here is what will happen to your complaint: 

1.	 Complaint submitted: The CFPB will screen your complaint based on several criteria. 

These criteria include whether your complaint falls within the CFPB’s primary 

enforcement authority, whether the complaint is complete, and whether it is a duplicate 

of another complaint you have submitted. 

2.	 Review and route: If a particular complaint does not involve a product or market that 

is within the Bureau’s jurisdiction or that is currently being handled by the Bureau, 

Consumer Response refers it to the appropriate regulator. Screened complaints are sent 

via a secure web portal to the appropriate company—the business you have the 

complaint with. 

3.	 Company response: The company reviews the information, communicates with you 

as needed. It then determines what action to take in response. The company reports back 

to you and the CFPB via the secure “company portal.” After your complaint is sent to the 

company, the company has 15 days to provide a substantive response to you 

270 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
and the CFPB. Companies are expected to close all but the most complicated 

complaints within 60 days. 

4.	 Consumer review: CFPB then invites you to review the response and provide 

feedback. Consumer Tracking: You can log onto the secure “consumer portal” available 

on the CFPB’s website or call a toll‐free number to receive status updates, provide 

additional information, and review responses provided to the you by the company. 

5.	 Review and investigate: The CFPB reviews your feedback about company responses, 

using this information along with other information such as the timeliness of the 

company’s response, for example, to help prioritize complaints for investigation. 

6.	 Analyze and report. Complaints help with the CFPB’s work to supervise companies, 

enforce federal consumer financial laws, and write better rules and regulations. The 

CFPB also reports to Congress about the complaints we receive and makes anonymized 

consumer complaint data available to the public on its website format: 

http://www.consumerfinance.gov/complaintdatabase. 

Contact information 

Online: consumerfinance.gov/complaint 

Toll‐free phone: (855) 411‐CFPB (2372), 8am‐8pm EST, Monday ‐ Friday 

TTY/TDD phone: (855) 729‐CFPB (2372) 

Fax: (855) 237‐2392 

Mail: 

Consumer Financial Protection Bureau 

PO Box 4503, Iowa City, IA 52244 

271 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 

Tool 4: 

Learning more about 

consumer protection 

Protecting your rights as a consumer starts with knowing that you have rights. The following 

consumer protection laws establish consumer rights related to financial services and products. 

This is not a comprehensive list, but it provides a starting place for understanding some of the 

many rights and responsibilities about which financial educators and coaches should be 

familiar. 

Read the summary of each law below. Put a check in the “Follow Up for More Information” 

column if knowing a little more about this law will help you or people you know. The follow the 

link listed within the “Short Description” or visit our website at 

http://www.consumerfinance.gov for more information. 

Consumer 

Protection 

Law 

Short Description Follow 

Up 

Regulation B:  The Equal Credit Opportunity Act (ECOA), implemented by Regulation B, 

makes it illegal for a creditor to discriminate in any aspect of a credit Equal Credit 

Opportunity transaction on the basis of race, color, religion, national origin, sex, marital 

status, age (provided that the applicant is old enough to enter into a Act contract), receipt of public assistance income, or good faith exercise of 

certain consumer rights. 

 ECOA and Regulation B prohibit certain creditor practices, such as the 

refusal to provide credit if an applicant qualifies for it; the discouragement of 

an applicant from applying for credit; an offer of less favorable terms to an 

applicant than terms offered to someone similarly situated; on the basis of 

any of the above listed characteristics. 

 ECOA and/or Regulation B require(s) creditors, among other things, to: 

 Notify applicants of actions taken on their applications. 

 If it furnishes information to credit bureaus, do so in the names of both 

spouses on an account. 

 Retain records of credit applications. 

273 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 Solicit information about the applicant's race and other characteristics 

in applications for certain residential mortgages for government 

monitoring purposes. 

 Provide applicants with copies of appraisal reports used in connection 

with residential mortgage applications. 

For more information about this law including information about how to detect 

discrimination, visit http://www.consumerfinance.gov/fair-lending. 

Regulation C:  The Home Mortgage Disclosure Act (HMDA), implemented by Regulation C, 

Home requires certain mortgage lenders to collect and report loan data that can be 

Mortgage used to: a) help determine if financial institutions are serving the housing 

Disclosure needs of their communities; b) assist public officials in distributing publicAct sector investment to attract private investment to areas where needed; and c) 

assist identifying possible discriminatory lending patterns and enforcing 

antidiscrimination statutes. This data is available for use by the public as well 

as by federal and state regulatory and enforcement agencies. 

 Data fields required to be reported under HMDA include, for each application, 

the action taken by the creditor; the location of the property to be mortgaged; 

the race, ethnicity, and sex of the applicant; and the income relied on in the 

application. 

For more information about this law, visit 

http://www.consumerfinance.gov/learnmore. 

Regulation E:  Establishes the basic rights, liabilities, and responsibilities of consumers who 

Electronic use electronic fund transfer services or send remittances and of the financial 

Fund institutions and other companies that offer these services. “Electronic fund 

Transfer Act transfers” include transactions, for example, where you swipe your card at 

check-out, make purchases with your card by phone or online, or make 

deposits or withdrawals at an ATM. “Remittance transfers” sometimes called 

international wire transfers), include many common ways of transferring 

money to people in other countries. 

 Protects individual consumers engaging in electronic fund transfers or 

remittance transfers. 

 Restricts inactivity and service fees and limits how quickly funds can expire 

for gift cards, gift certificates, and certain other prepaid cards. Requires all 

fees and other important terms to be clearly communicated in writing. 

 Applies to any transaction initiated through an electronic terminal, telephone, 

computer or magnetic tape in which a financial institution is told to either 

deposit or withdraw from an individual’s account at the financial institution. 

Establishes “opt in” provisions for overdraft fees on ATM transactions and 

non-recurring debit card transactions; financial institutions are prohibited from 

charging overdraft protection fees on these unless consumers opt in. 

274 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
For more information on the “opt in” provisions for overdraft fees, visit 

http://www.consumerfinance.gov/blog/whats-your-status-when-it-comes-tooverdraft-coverage. 

For more information on remittance transfers (also covered under Regulation 

E), visit http://www.consumerfinance.gov/regulations/final-remittance-ruleamendment-regulation-e. 

Regulation F:  The Fair Debt Collection Practices Act (FDCPA) is the main federal law that 

Fair Debt governs debt collection practices. 

Collection  The FDCPA prohibits debt collection companies from using abusive, unfair or 

Practices Act deceptive practices to collect past due debts from you. 

 The FDCPA covers the collection of consumer debt such as mortgages, 

credit cards, medical debts, and other debts primarily for personal, family, or 

household purposes. It covers personal debt, not business debt. 

 The FDCPA does not generally cover collection by the person or business 

from whom you first borrowed money—it covers third party debt collections 

(debt collection agencies and debt-buyers involved in collection) and 

attorneys who collect debt on behalf of their clients. 

For a summary of this law visit 

http://www.consumerfinance.gov/askcfpb/329/what-is-the-fair-debt-collectionpractices-act.html. 

Regulation M:  Ensures that people who lease personal property receive meaningful 

Consumer disclosures that enable them to compare lease terms with other leases and, 

Leasing Act where appropriate, with credit transactions. 

 Limits the amount of balloon payments in consumer lease transactions. 

 Provides for the accurate disclosure of lease terms in advertising. 

For more information on leasing an automobile, visit 

http://www.consumerfinance.gov/askcfpb/815/should-i-buy-or-lease-whatsdifference.html. 

Regulation P:  Governs the treatment of nonpublic personal information about consumers by 

Privacy of financial institutions and by institutions that use or re-use or re-disclose 

Consumer information from financial institutions. This type of information includes your 

Financial account information and your Social Security number. 

Information  Provides a method for consumers to prevent a financial institution from 

(Gramm­ disclosing that information to other businesses or individuals by “opting out” 

Leach-Bliley (there are exceptions to this). 

Act)  Restricts when financial institutions may disclose non-public personal 

financial information to other businesses or individuals. 

275 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 Requires financial institutions to send privacy notices to consumers in 

specified circumstances. 

For a link to Regulation P, visit: http://www.consumerfinance.gov/regulations. 

Regulation V:  Provides guidelines and limitations for persons that get and use information 

Fair Credit about consumers to: 

Reporting Act  Determine the consumer's eligibility for products, services, or 

employment; 

 Share such information among affiliates; and 

 Furnish information to consumer reporting agencies. 

 Limits the reporting of outdated negative information. 

 Limits who can access information in a consumer’s credit file. 

 Establishes consumer rights including the following: 

 Consumers must be informed their filed has been used against them— 

the information has led to a denial of a product, service, or employment. 

 Consumers have the right to know what is in their file. 

 Consumers have the right to dispute incomplete or inaccurate 

information; consumer reporting agencies must correct or delete 

inaccurate, incomplete, or unverifiable information. 

For answers to common questions regarding this law, visit 

http://www.consumerfinance.gov/askcfpb/search?selected_facets=tag_exact 

%3AFair+Credit+Reporting+Act. 

Regulation X:  Provides advance disclosures of settlement costs to home buyers and 

Real Estate sellers. 

Settlement  Prohibits kickbacks or referral fees for settlement services. 

Procedures 

Act  Regulates mortgage servicers’ management of escrow accounts established 

to ensure the payment of real estate taxes and insurance. 

 Requires Mortgage servicers to correct errors and provide certain information 

requested by borrowers 

 Requires mortgage servicers to provide information to delinquent borrowers 

about mortgage loss mitigation options and to establish policies and 

procedures for continuity of contact with servicer personnel regarding these 

options. 

For more information about this law, visit 

http://www.consumerfinance.gov/knowbeforeyouowe and 

http://consumerfinance.gov/regulatory-implementation. 

Regulation Z: 

Truth in 

Lending Act 

 Promotes the informed use of consumer credit by requiring disclosures about 

its terms and cost such as APR (annual percentage rate). 

 Establishes uniform terminology for credit disclosures, such as APR. 

276 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
 

 Gives consumers the right in certain circumstances to cancel credit 

transactions that involve a lien on a consumer's principal dwelling. 

 Regulates certain credit card practices. 

 Provides a means for fair and timely resolution of credit billing disputes 

 Additional examples of what this law covers: 

 Requires a maximum interest rate to be stated in variable-rate contracts 

secured by the consumer's dwelling. 

 Imposes requirements on home-equity plans and mortgages. 

 Regulates practices of creditors who extend private education loans. 

For more information on this law, visit 

http://www.consumerfinance.gov/askcfpb/787/what-truth-lending-disclosurewhen-do-i-get-see-it.html. 

Regulation  Ensures consumers are able to make informed decisions about accounts 

DD: Truth in offered at depository institutions. 

Savings Act  Requires depository institutions (banks, credit unions, and thrifts) to provide 

disclosures so that consumers can make meaningful comparisons among 

depository institutions. 

Resources 

Consumer.gov, Identity Theft: 

http://www.consumer.ftc.gov/features/feature-0014-identity-theft 

FBI.gov, Identity Theft: 

http://www.fbi.gov/about-us/investigate/cyber/identity_theft 

For additional resources, visit the Consumer Financial Protection Bureau website: 

http://www.consumerfinance.gov/AskCFPB 

If you have a consumer complaint, visit: 

http://www.consumerfinance.gov/complaint 

277 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS 
This Tool is included in the Consumer Financial Protection Bureau’s toolkit. The CFPB has prepared this material as a resource for 

the public. This material is provided for educational and information purposes only. It is not a replacement for the guidance or 

advice of an accountant, certified financial advisor, or otherwise qualified professional. The CFPB is not responsible for the advice or 

actions of the individuals or entities from which you received the CFPB educational materials. The CFPB’s educational efforts are 

limited to the materials that CFPB has prepared. 

278 YOUR MONEY, YOUR GOALS: A FINANCIAL EMPOWERMENT TOOLKIT FOR SOCIAL SERVICES PROGRAMS