Financial Literacy Issues Bring Senator Derek Kilmer to AFS

For Immediate Release September 9, 2008

Bremerton, WA ‐ Financial literacy issues bring Senator Derek Kilmer to local Credit Counseling Agency.

With shared concerns regarding the deepening credit crisis accompanied by a weak labor market, high inflation and falling house prices, Senator Kilmer met with Ron Lafayette, President of the North Seattle Community College and Hank Keaton, President of American Financial Solutions (AFS) to learn firsthand what services AFS is offering to consumers in financial distress.

Consumers and borrowers whose home loans are resetting at considerably higher rates are having a difficult time keeping up on payments while soaring oil prices are eroding already marginal household budgets. They are finding themselves in need of help in identifying options for improving their financial situations. That is where American Financial Solutions comes in. With trained and certified Credit Counselors, callers are provided education to understand their finances and what options are available to them. Most importantly, callers are empowered to make sound decisions to gain control of their finances.

The current credit crisis has spread from rising defaults in the market for sub-prime mortgage loans to other types of loans such as student loans or auto loans. Ron Lafayette, President of North Seattle Community College, expressed concerns about the credit crisis having a major impact on students keeping current on payments for student loans.

An article published in MSN Money April 22, 2008, titled Why Generation Y is broke, cited the following statistics:

  • median credit-card debt of low-and middle- income people aged 18-34 is $8,200
  • the average college debt for recent grads is more the $20,000 and rising
  • people between the ages of 25 and 24 make up 22.7% of all U.S. bankruptcies (but just 14% of the population at large)
  • only 52% of high school seniors passed a recent national financial literacy test, meaning adults entering the work force do not know enough about basic budgeting, interest rates or taxes to make sound decisions for their own lives.

Senator Kilmer asked, “Where do we learn about personal finance other than from our parents or at home?” Senator Kilmer, added, “Financial education is hugely important, but legislators are reluctant to add another mandate in our K-12 system so it is essential that partnerships are established”. It was agreed that there is a crucial need for Consumer Financial Literacy training and that training should start as early as possible to help people use credit responsibly.

American Financial Solutions (AFS) is a division of North Seattle Community College Foundation. Located in Bremerton, WA, AFS is a non‐profit 501(c)3 credit counseling agency promoting the need for financial education and personal money management.

AFS’ mission is to create change through education and service locally and nationally. AFS provides free budget, credit and housing counseling to consumers in addition to the personal money management course, Investing in Yourself.

In response to increasing consumer debt and rising foreclosure filings within the State, AFS has added Pre‐Purchase Housing Counseling, Foreclosure Intervention and Assistance Counseling, and will soon add Bankruptcy Counseling to its existing services.

AFS has partnered with schools, state and county agencies to provide financial literacy training.