This is Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at avoiding credit problems. Mike, try as they must, many people have trouble keeping their borrowing under control, especially borrowing using a credit card. I understand a relatively new program has had some success at curtaining credit problems. What is it?
- A program was established to periodically warn credit card users of their activities and the impact of their activities on the fico score
- Fico score measures credit worthiness – higher the better
- After a year the program found that that participants improved their creditworthiness compared to a “control” group
- For example, participants were less likely to have balances more than 30 days overdue
- Granted, the changes were not large, but they were judged to be significant
- Why did the program work
- People have busy lives – reminders help
- I’m MW
And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.