Positive Transitioning Magazine - August 2019

The Financial Issue The Trouble With Payday Loans Credit Score Basics

Pennsylvania State Resources

In This Issue Financial Issue August 2019 Letter from the Executive Director Words of the Month Pennsylvania State Resources Credit Score Basics The Trouble with Payday Loans Finding Your Financial Guru A Plant-Based Lifestyle

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Letter from the Executive Director Money is a touchy subject. People from ALL walks of life run into money troubles. And nobody wants to talk about it. When we don’t talk about our problems, we can’t help others prevent making the same mistakes.

Finances become additionally challenging for anyone who has spent time behind bars. The bills don’t stop, so inmates can come out of lockup with unpaid bills and a ruined credit score. But like I said earlier, people from ALL walks of life run into money issues. Your personal value is not determined by your net worth. More importantly, you can turn it around – yes, even you!

Our first article highlights the trouble with payday loans, where high interest rates can put people and families in a debtor’s spiral – which can be especially hard to get out of if you’re just getting on your feet.

In our second article, we cover the value of a credit – why’s it so important?

I wish we could write the book on financial literacy, but there are so many great resources out there, we’ve compiled a list to get you started. There are several philosophies and schools of thought out there, and we’ve rounded up some of the resources.

Our writers share their personal stories and learn a little too along the way.

Sincerely, Porche Proffit

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Masthead and Contributors Editor-in-Chief, Porche Proffit Editor, Ericka Foster

Contributors Writer, Maggie Allen Nutrition and dietician Isabella Dos Santos

Check out the Positive Transitioning App on the Google Play Store! https://play.google.com/store/apps/details?id=com.appsmakerstore.app PositiveTransitioning Check out our Radio Show! https://www.radionomy.com/en/radio/omertaradio

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Word (s) of the Month “Most of the things we buy are wants. And we call them needs, but they're wants.” ~ Dave Ramsey (see page 13 for more info).

need require (something) because it is essential or very important.

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want have a desire to possess or do (something); wish for.

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Food

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Toys and games

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Shelter

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Jewelry

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Clothing

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Entertainment

Pennsylvania State Services  The Aleph Institute www.alephne.org The Aleph Institute is a non-profit Jewish religious, educational, and humanitarian organization offering services to imprisoned Jewish men and women and their families. The organization offers providing assistance with housing and employment, skill training programs, and opportunities for mentor.  Capital Region Ex-Offenders Support Coalition (CRESC) www.reentrynow.org/ CRESC is a network of caring professionals and community leaders whose purpose is to provide encouragement, hope and resources for the ex-offender. The coalition hosts weekly meeting to address topics related to re-entry.  Outreach - Center for Community Resources outreachworks.org/court-related-programs/ Outreach - Center for Community Resources offers multiple programs that promote family stability and economic self-sufficiency. In addition to other family services offerings, the organization has a program for those reentering society that includes courses in life skills and parenting skills.  Forgiven Ministries forgiven-ministries.org Forgiven Ministries is a faith-based organization that offers resources for transitional housing and employment resources.

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 Foundation of Hope www.foundationofhope.org/programs/ Located in Pittsburgh, The Foundation of HOPE is an interfaith non-profit with the mission to “Empower incarcerated and released individuals to restore their relationship with their God, rebuild their lives, and reconcile to their communities.”  A Miracle 4 Sure www.amiracle4sure.com/services Serving Lancaster and surrounding counties, this program offers case management in services such as mentoring, housing, parenting, and more.  Eighth Avenue Place eighthaveplace.com/about-eighth-ave-place This location is a physical coffee shop, which serves as a location for support services and meetings. The coffee shop setting creates an environment for group discussions and fellowship.  Manna House www.reachingup.org/?page_id=75 Manna House is a housing program supported by Reaching Up & Out, which is designed for women re-entering society; housing can last between 6 and 18 months.  TRAILS Ministries trailsministries.org Located in Beaver County, TRAILS provides re-entry services for youth and adults. The organization provides support with employment, transportation, counseling, and spiritual guidance.

Next month’s issue Next month we address financial literacy.

We will also highlight Pennsylvania resources

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Working Together to Build a Positive Transition Thank you for taking the time to read Positive Transitioning magazine. This organization assists individuals coming out of jail or prison.

I know you are asking yourself why should you assist someone that has committed a crime. • 94% of individuals in jail will one day come back to their community. • 67.8% of them will be re-arrested within 3 years. • 76.6% will be re-arrested within 5 years.

These reoccurring crimes are committed within our communities.

Most individuals upon release are unable to find employment due to harsh employment requirements, cannot find housing due to unfair housing rules, may not have family that can support, have mental or health issues and were getting assistance in jail/prison but upon release have no assistance.

Please take the time to watch the video and make a donation to our organization.

With these hurdles for them to face we understand why they may commit another crime.

Our organization assist individuals with finding employment through workforce development programs, entrepreneurship programs, and developing businesses that we can hire them if other employers will not. We also assist with housing, family integration, education, health and wellness and a host of other programs by providing them a life coach to assist and encourage them to return to their communities and be an asset and not a liability to their families, friends, and neighbors.

We have started a campaign called We are the Spark. This campaign asks for a $6.16 donation to our organization. We have to help each other to overcome the crime and violence that is plaguing our communities. Please take the time to watch the video and make a donation.

We are the Spark

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Credit Score Basics

By Ericka Foster

Credit is your ability to pay back money that you’ve borrowed. Your credit score is a three-digit number that relates to how likely you are to repay debt. FICO is the most used one, but there are several. Regardless of where you get your credit score, it is based on your credit report. It is hard to rebuild a life (almost impossible) without a credit check. If you are financing a car or home, you can expect a credit check. Additionally, insurance companies, rental companies, hospitals, cell phone companies, cable companies, and utility companies will also try to take a peek at your credit score.

What elements make up a credit score?

Five elements make up your credit score: Payment history, credit to debt ratio, types of credit used, frequency of new credit, and credit history.

The biggest chunk of your credit score is based on your credit history – how often you pay your bills on time. If you have been incarcerated and haven’t been able to pay your bills on time, your credit score has most likely taken a hit. If you get a ding on your credit for nonpayment, it lasts for seven years.

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Someone who has been incarcerated for longer than seven year may have a credit history that is lacking.

You're entitled to one free copy of your credit report every 12 months from each of the three nationwide credit reporting companies. Order online from annualcreditreport.com, the only authorized website for free credit reports, or call 1-877-322-8228. You will need to provide your name, address, social security number, and date of birth to verify your identity.

Upon release, grab a free copy of your credit report and make sure that it is correct. You’ll have to pay for a copy of the actual credit score.

Reach out to a local nonprofit for assistance on gaining access to your credit score.

How can I boost my credit score?

The main thing you can do to improve your credit score is wait. Negative elements of your credit score become less impactful over time. Some companies claim that they can help you boost your credit score if you pay them. However, it is YOUR credit score, they can’t do anything you can’t do.

They may dispute incorrect claims on your behalf, or request that items be removed, but you can do the exact same thing. It just requires time and patience.

Some credit companies are now offering services to “boost” your credit score by gaining access to your banking information and reporting on-time payments for items not regularly reported to a credit bureau. Be wary. It has been reported that the positive effect is minimal, increasing scores by 30 points or so. Additionally, providing that data to a company will give them access to ALL of your spending habits. Those companies make money by keeping track of your spending habits and trading that information to advertisers.

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The Trouble with Payday Loans

By Maggie Allen It’s not unusual for someone to leave prison with a mountain of debt. In addition to restitution, there might be back child support due or the debt that they accumulated before they went in. It may be tempting to get a payday loan to ease the burden.

Pay Day Loans are everywhere these days. They go by many names; “cash advance,” “credit access business,” “deferred deposit,” and more. Depending on where you live, there may be as many lenders as gas stations, grocery stores, or Burger Kings -- one for every street corner. They’re local and convenient, so you may be thinking to yourself: why not?

On the surface, it can seem like a pretty sweet deal.

For many people, it’s much-needed extra money; a small amount lent to you, provided that you pay it back on or before your next payday.

In very rare cases, you may even have a whole month. And when I say small, that’s really all in the eye of the beholder; most states allow pay day lending caps as low as $300 and as high as $1,000. That’s not nothing, and it could really help some people who are struggling to get their finances under control.

And if you don’t have the best credit, so what? A lot of lenders won’t even check your score. Even if they do, many of them willing to work with you. In general, you just need a long-standing checking account and usually $500 minimum monthly income, earned from a job that you’ve held for a certain length of time.

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Simple, right?

Wrong. This is very often a trap designed to keep you stuck until you have nothing left to give.

You see, if the loan isn’t repaid in full by the following payday, a new charge is added. According to PEW, twelve million Americans take out payday loans each year, spending $9 billion on loan fees. In addition, the average borrower is in debt for five months of the year, spending an average of $520 in fees to repeatedly borrow $375. That adds up in a short amount of time, and it might even be addicting. Payday loans are advertised as being helpful for unexpected or emergency expenses, but 7 in 10 borrowers use them for regular, recurring expenses such as rent and utilities.

Many people think that payments spread out over time is a good deal. For example, if you can get an iPhone XR now, and pay off the $749 in small, manageable monthly installments in the year to come, why not?

What buyers sometimes fail to take into account are the interest rates. If you don’t pay, or don’t pay the right amount, you will owe more in interest. And payday loans in particular often come saddled with very high rates. The CFPB found the median online payday loan cost $23.53 per $100 borrowed, which amounts to 613% in interest.

Not quite the cheap, quick solution that it first appeared to be, is it? Another little fun tidbit is that lenders can take your wages sooner than you might like. While payday loans are usually due in two week periods and are tied to the borrower’s pay cycle, lenders have direct access to a borrower’s checking account on payday, electronically or with a postdated check. This is part of your agreement with them, and it ensures that the payday lender can collect from the borrower’s income before other lenders or bills are paid. So that electric, heat, or credit card bill you were hoping to tackle? Now it will be put off again!

And it gets better. Lenders will keep trying to withdraw money from your account, sometimes breaking amounts into smaller chunks to help the payment go through, and every failed attempt can then initiate bank fees you will have to pay.

Meanwhile, if they’re not getting what they want fast enough, payday lenders may start calling you and sending letters from their lawyers. Scarier still, they may call people you know, like your personal references or employer.

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The payday loan industry relies on people who can’t pay them back. Three-quarters of payday loans go to those who take out 11 or more of the loans annually. Much like for-profit prisons, they have no incentive to address the problem because they are making money. And we can assume that they will fight efforts to reform their practices as much as possible.

Financial planning is hard for all of us. You try to plan for emergencies while surviving, caring for your family, and buying the occasional indulgence, but despite your best efforts, things come up. Maybe you did save a good, solid amount, but the cost was unexpectedly high. Just last week, I had to drop $2,000 on an unforeseen car repair, and I hated every moment of signing that awful invoice.

So I get it. It’s tough. But don’t give up. What else can you do if you really need the money? First, let’s start with some things to avoid. Be wary of long-term payday installment loans, or no-credit-check installment loans. These can be repaid in as late as three years, but interest rates can really creep up on you. And don’t do title loans on your personal vehicles. You have to give them the title on your car, and if you don’t repay them, they can seize it. Basically, if it sounds too good to be true, believe it. Look somewhere else.

When you owe money that you don’t have, it’s time to get creative. Look to reduce expenses. Ugh – you may be living on bare bones anyway. And cutting back usually means eliminating the fun stuff like alcohol, groceries, Have you sold off items you no longer use to raise money?

and entertainment. In the short term, those savings can add up.

Talk to your bill collectors. Yes, you read that correctly – negotiating payment terms for necessities like electricity, water, and sometimes rent can help free up funds for emergencies. If that fails, you might be able to borrow from a family member, or your employer, or expedite a payment from later in the month.

Whether you are borrowing from someone you know, or negotiating with a bill collector, be the person that keeps their word. Not only will it benefit you if you end up in a jam again, it makes you feel good about yourself when you are trustworthy.

If you’re tapped out of ideas, take advantage of the financial advice that many nonprofits offer. A social worker or case worker may be knowledgeable on additional ways that you can avoid taking out a payday loan.

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Finding Your Financial Guru

By Ericka Foster Have you heard the common financial advice that if you just skip your Starbucks coffee purchase in the morning, you can get out of credit card debt. That’s BS if you are barely making ends meet, and you’re still trying to find the funds to pay for water. The trick with financial advice is to take what you can learn from many You can't save on coffee if you're figuring out how to different sources. Over time, you’ll pay your water bill. make less mistakes, and learn more about what you need as your finances change. You can learn something from everyone, if you’re looking.

In fact, one of the reasons that we wrote the financial literacy articles in first person is that we are all in the same boat – we’ve got something to learn.

And we can learn from each other.

You can do it!

Going by the prison name “Wall Street”, current Pelican Bay inmate Curtis Carroll became a Wall Street investor. He entered prison at 17 on a murder charge as someone who couldn’t read. In fact, he made his first investment before he learned to read in prison. invested in stocks before he learned to read. Now, he has someone trading stocks for him on the outside. He also co-founded Project F.E.E.L. (Financial Empowerment Emotional Literacy), a non-profit to help improve financial literacy. According to its website, the organization has developed a curriculum that “not only teaches basic personal finance, like how to budget and save properly, but more importantly how to analyze feelings, needs, personal expression, and to understand their connection to spending and saving habits.” He can be an example of what is possible for all of us. It may seem like Curtis has an unusual story, but more than a few financial “gurus” were inspired to take control of their finances after hitting a financial rock bottom.

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Money advice is money advice, but not exactly…

Money can be an incredibly emotional subject. When taking advice on things we need to do more than we want to do, we can look for a tough love approach or a nurturing approach. That’s where you find most of the differences in a financial teacher. There are so many books and authors, so it is really about finding the approach that works for you. I am a big Suze Orman fan because I appreciate her “girlfriend” approach.

Dave Ramsey is a very popular financial guru who has created a program often available in churches. His readers appreciate his faith-based, nononsense approach. Washington Post columnist Michelle Singletary built her financial career answering questions from people like you and I. It is important to realize that any guru you pick isn’t any smarter than you are. You can learn from them and use the same tools they do in a way that works for you.

Pick your poison…

Although you can’t go wrong with a good book, you can get your financial advice from blogs, podcasts, television, or classes. I learned about the Financial Independence Retire Early movement from a podcast. Don’t let the name deter you -- these guys trade tips on living on the bare bones. The philosophy is to make as much as you can, spend as little as you can so that you can save as much as you can for retirement. As someone re-entering society, you’re spending as little as you can while you take the time to get back on your feet. These guys are always trying to save a dollar – aren’t you too?

Below we’ve compiled a list to help you get started on your financial journey.

As you listen to these podcasts, and read these books, and keep pencil and paper handy. You’ll get ideas about what you can do, you’ll hear about other books and podcasts that can help you take your finances to the next level.

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Podcasts The Dave Ramsey Show Dave Ramsey inspired many of the younger bloggers and podcasters to get their finances in order.

Choose FI This podcast is a popular one among those interested in financial independence.

Books Zero Debt: The Ultimate Guide to Financial Freedom by Lynnette Khalfani-Cox

Paychecks and Balances This podcast for millennials interested in making money, saving money and getting out of debt.

The Money Book for the Young, Fabulous & Broke by Suze Orman

His & Her Money Talaat and Tai McNeely help married couples navigate their financial lives

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The 21 Day Financial Fast, by Michelle Singletary challenges readers to buy only the barest essentials.

Online Generation Wealthy Generation Wealthy is a nonprofit website that produces financial education content, to break the taboo of talking about money.

Making Sense Of Your Personal Finances Learn to set S.M.A.R.T. financial goals and work out how much you need for your goals.

Personal Finance Here are 8 YouTube videos from the University of Missouri that provide basics on concepts like budgeting, credit, insurance, and more.

A Plant-Based Lifestyle

By Isabella Dos Santos This article will not be about convincing you to become a vegetarian nor vegan... but it will not encourage you to not become one either.

Let me explain. In the last few years more and more people have leaned towards plant-based diets, with an increase in the number of vegetarians and vegans. For those of you who do not know the difference, vegetarians (on a general basis), do not eat any meat, poultry or fish, but may eat products that come from them (such as dairy and eggs). Vegans, on the contrary, will not eat any product that comes from an animal (including honey, for example).

When you ask vegetarians or vegans the reasons of their diets, the most common answers are health, environment or religion. Whatever their reason, it is a type of diet that should be respected, and although we still have a long way to go in terms of research, a nutrient-complete plant-based diet can be beneficial for many people.

What it is true is that the world does need us to reduce significantly the consumption of animal products. Unfortunately, cattle and chicken raising, as well as overfishing, are a big contributor in climate change. Therefore, reducing the quantity of animal protein in our diet can be beneficial for the planet (and our health).

Try a plant-based meal a day or maybe do a couple vegetarian days a week.

Here are a couple ideas to begin: Egg and Hummus Wraps

Rice and black bean salad

 Scrambled egg (1 eggs)

 Cooked brown rice (1/2 cup)

 Hummus (2 tbsp)

 Cooked black beans (1/2 cup)

 Whole grain tortilla (1 unit)

 Carrots (1/2 medium)

 Roasted eggplant (1/2 cup)

 Tomato (1 small)

 Crumbled feta cheese (2 tbsp)

 Red onion (1/4 cup chopped)

 Olive oil (1 tsp)

 Parsley and cilantro  Guacamole (1 tbsp)

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