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♪ >> this is NJ Business Beat with Raven Santana.

Raven: I'm Raven Santana.

Thank you for joining me.

A new year means new resolutions.

One of the most popular and important goals is getting your finances in order.

From building savings to managing debt, there are many states you can take to improve your financial health.

According to the federal survey of consumer finances, the average American has about $62,000 across all accounts.

Savings, checking his, retirement, and more.

When it comes to savings accounts, people ages 65 to 74 have about $85,000 saved compared to $3200 for people under the age of 35.

The disparity is greater when you break it down by race.

The average white savings account has more than $8,000 saved compared to $1500 for black savings accounts, and $2000 in Hispanic savings accounts.

Wilting that generational wealth starts with good financial health and to get you financially ready for 2024.

I sat down with Sylvia guide and from Wells Fargo.

January is a great time to reassess finances and boost your savings.

What are some things you should do to get your finances in order?

>> I think it is a great time to do a fresh start.

We always say it is important to start by paying yourself, first.

If you can set up some auto deductions so you don't feel it and it is coming right out, that is ideally one of the best things to do.

It is out of sight and you are getting it done.

When we talk about savings, it is important to maximize.

We get an opportunity through our employers to save a 401(k), that they try and save as much of the tax-deferred funds as you can.

And after that, do automatic savings into your individual account, your own account.

It is so important to have an emergency fund if something comes up so you can take care of it.

>> when should you start organizing tax documents?

We start seeing those letters and notifications soon.

>> excellent question.

Ideally, even something this year, if you can start setting up a file to start keeping the documents you will need for next year, reminders.

Certainly now as we progress into January, it is great.

You can have one where you keep all of your w-2s that come in, the bank statements and write offs or contributions and gifts you have given is ideal.

Raven: All that can somewhat be overwhelming to some people.

What are some questions you should ask your account?

>> I think it is really important as you are meeting with them to talk about strategies you could be maximizing next year to put yourself up in the best way you can.

Whether it be the recommended saving a little more than the IRA, whether it be taking advantage -- some employers offer an hsa, house savings account.

Money you can put aside pretax for medical bills.

Again, strategizing with the account of what you can be doing this year to set yourself up for next year.

Although it is overwhelming, I think by having some kind of folder or place where you add things that are tax related coming in, you put it in, making it so much easier for next year.

>> Organizing is key.

Another topic I want to focus on his credit scores.

Credit scores are credit -- critical to obtaining loans.

Is it a good time to check your credit rating and improve it?

>> Yes, excellent time.

New year, fresh start.

Take a look at where you stand today and map out a plan on what to do to get the credit score up.

If you have a little bit too much on the cards from the holidays, or in general, you can make a plan to pay them down to boost up your score.

Making sure you pay things on time and setting those intentions.

It really does help in the long run as you need lending for cars or homes.

It is great to have.

>> What should you not do?

>> In terms of credit, be careful.

So many times, wherever you shop and they are offering the store credit card, you are letting them run your credit.

And you have this outstanding credit.

The more they pull your credit, the more it brings your credit down.

And the likelihood, we have so many different cards because of different specials or opportunities we think we are getting.

But if you forget to pay one of them, you start to get dinged on your credit.

Streamlining it, having one card or two that you think is good and use it as your card.

Being very mindful about paying it every month.

And not utilizing it to the extent they are giving you credit for.

>> we focus a lot on damage control.

With credit.

But is it ever too soon to be planning for your future?

Pension or finances later in life?

Any tips for people who are watching?

>> I think the sooner you start planning now, the more you alleviate the pressure of what you have to do later.

Some of these times we think I'm too young, or I don't have cash flow and I cannot do it.

The sooner the better.

Whether it be for your retirement, if you have a child, if you can start putting a little bit away for college savings.

Sometimes it seems little, but all of these efforts you make really compound and add up over time.

>> not everyone can afford to hire a financial planner.

If this is not possible, do you have any suggestions for free resources?

Where can people go to get help or guidance?

>> I think a lot of the companies, if you go to company websites, like Wells Fargo or Merrill Lynch, fidelity, there's a lot of great research available on those websites.

If you do social media, you can connect and get on, just to get some input on what you are seeing.

I also think if your company offers a 401(k), there is some buddy running that plan and they offer advisors to speak with you.

>> I hope everyone was taking notes.

Thank you for joining me on NJ Business Beat.

>> it is a pleasure, take care.

Happy New Year.

Raven: One of the biggest economic changes coming in 2020 four is increased minimum wage.

Reaching above $15 an hour in New Jersey for the first time since the so-called fight for 15 started more than a decade ago.

Compare it to the federal minimum wage, which stands at 725 an hour.

It is a significant accomplishment that took years of advocacy and campaigning.

But where do we go from here?

We have talked to advocates who have stressed minimum wage does not match a living wage or the amount needed to live comfortably in New Jersey.

I spoke to Peter Chen who spoke about the next steps in the fight for a living wage.

We were just speaking about how expensive it is to have children.

You have two small children, I have two small children.

Think about aftercare and all of these, it is important to our topic.

Is it enough?

>> know it is not.

The cost of living in New Jersey is high.

Everybody knows.

Arent and housing costs are high.

Transportation, health care costs and childcare are high.

When we think -- when we think about how what the minimum wage should entail, it should be what the real costs are for a typical family, rather than a round number.

The minimum wage law passed in 2019, it does include -- once it hits $15 and $.20, it will raise based on the inflation increase.

But we know that is not enough to really meet the cost of living in New Jersey.

Raven: What is enough?

>> I don't want to set a specific number.

But I think we have to start with what the cost of living looks like for a typical family.

Some folks have done great work on this.

Legal services in New Jersey, the United Way of New Jersey has the Alice report which talks about the real cost of living.

It does depend.

If you have kids, if you are taking care of an aging parent, if you live on your own.

There are a lot of factors.

Thinking about $50 an hour and what that looks like.

That is for a full year, full-time work.

We are talking about $30,000.

If you think about the median income in New Jersey, it is around $90,000 for a household.

Cut it by two thirds and say figure out how to make ends meet.

The median family is having a hard time with costs.

They're looking at their mortgage or utility bills and are trying to thinking -- think about how to make ends meet.

Think about a family making less.

How will they make ends meet?

That is where we want to think about where the minimum wage needs to go next.

The minimum wage should be about ensuring that people are able to live a life worth living in New Jersey.

In a lot of places, thinking about rent alone, if you think about multi-bedroom apartment, that will eat almost half of that wage.

Raven: We know it is not one-size-fits-all.

I will rephrase my question.

What do you think the minimum wage should be?

>> the minimum wage has to increase -- one of the things about the minimum -- minimum wage increases, we have to make sure it is meeting the real costs folks are experiencing.

The $15 fight, even in itself -- back in 2019 when the law was passed, the $15 minimum wage could have gone further.

The cost of living increased just in the last -- since the law was passed originally.

The inflation index is important.

Looking at something like the cost of living, wage calculators from something like -- M.I.T.

has a living wage calculator they use that puts the living wage for someone with a child at around $25 to $30 an hour.

I think it is a long path to get from here to there.

Thinking about how we can make sure everyone in the state, when they are putting in an honest days work, are getting back enough money to raise a family, to live a meaningful life in the state.

That is important to look at.

I think there is a misconception about minimum-wage and low-wage jobs, these are jobs people are starting off at, and eventually will move up.

The reality is people working minimum-wage jobs are supporting families, this is their career.

That is what we have to think about designing policies that ensure all New Jerseyans can have a successful life.

It is fair to say it impacts those relying on tips or small businesses.

They are very impacted by this.

>> unfortunately, there are a number of exceptions.

The minimum wage will be $15 and hour.

Not for everybody.

Tipped workers continue to get a low minimum wage and are topped up by tips, or agricultural workers, workers at small businesses, team workers, a lot of folks are carved out.

Their work is not less valuable.

They are putting in the same kind of hard work.

Cultural work is harder than my job.

It it gets compensated at a lower rate than minimum wage.

Raven: Let's talk about the New Jersey tax credit increase.

Tell me more about that increase .

Is it going to be enough?

How is it helping?

>> It is a huge help.

One thing we have seen is any amount of additional cash back in the family's pocket is worthwhile.

When we think about the high cost of raising kids.

We have heard the governor talk about it, other New Jersey legislators talk about how important affordability is and to raise a family in New Jersey and make it the best place to raise a family.

It cannot be the best place if you cannot afford to do it.

What the child tax credit does is give back -- when you file taxes, it sends you additional money bag based on the number of children you have under the age of six.

That is the way the New Jersey credit is structured.

This past year, it was $500.

The maximum credit will be $1000.

We know $1000 will not make the difference between -- for a lot of folks.

But it is something that can help smooth some of the bumps in costs that can happen over a child and a families life in a year.

One of the concerns is the tax credit phases out at age six.

Kids don't stop having costs at age six.

We need to make sure that credit is extended to more age ranges to make sure that families continue getting the support, even if the kids are no longer young children.

And the dollar amount should be increased.

We see that for a lot of families.

They do need that extra assistance.

We saw with the federal tax credit, a reduction in poverty.

Once families are able to have that tax credit in their pockets, in their bank accounts to help get by and meet these costs we are talking about.

Whether it is rent, food, childcare costs, or something like extracurricular costs, sports equipment, piano lessons.

These things are valuable in the lives of kids that families should make the choice of whether they want to take part in.

Raven: Something to work on.

It will not happen overnight.

Thank you for joining me, Peter Chan.

Tackling mountain debt is generally your first step towards repairing your finances and building towards generational wealth for your family.

From credit cards, mortgages, car payments, Americans have racked up more than $17 trillion in debt.

According to the Federal Reserve of New York.

Nor just -- mortgages account for more than that at $12 trillion followed by student loan balances at 1.6 trillion dollars and credit cards at more than $1 trillion.

I spoke with Kim Cole of Nava core solutions about overall financial literacy and ways to manage debt.

The holidays are a great time for giving, but it can put you in debt.

Tell me how you help your clients manage their debt.

>> We start by looking at the situation, getting an idea of what the true root of the debt is and building outward from there.

We believe in financial education and working with each individual on how to come out of their debt without doing any damage to their credit, easily falling back into the same patterns.

Raven: I'm wondering how much debt people incur over the holidays and your advice for paying that down?

>> We are looking at about $2000 in credit card debt.

But I would be remiss if I did not point out with interest rates being much higher this year than they were even last year, that debt is going to grow much faster than it has in years past.

So what we do is work on a spending plan with our client.

We look at different options on debt repayment.

We review with them everything from how to pay the debt back on their own right up through a debt management plan where we are involved in every step.

Raven: You kind of mentioned this, but what is the biggest type of debt you are seeing?

Is it credit cards, medical, housing payments?

>> With places on housing being higher than they ever have -- with prices on housing being higher than they have been, people are having a hard time making rent payments under relying on credit cards more so than before.

So it really is.

It starts at the level of rent and it goes downhill from there.

I say it is a combination of rent and credit card debt.

Raven: Are you seeing consumers get into financial trouble because of these by now, pay later options?

>> Unfortunately, we see quite a few clients get themselves involved in by now, pay later.

My philosophy and what I share with my clients is if you cannot afford it now, saving and buying it later is your best course of action.

Raven: How are your clients managing your debt now that student loan payments have restarted?

>> We offer receiving many phone calls -- We are receiving many phone calls regarding student loan debt repayments.

We have a student loan department in which we work with our clients on coming up with what is affordable for them and assisting them with reaching out to their servicers and finding the best repayment option for them through their student loan servicers.

As well as working with them on other areas of their debt, such as credit cards.

Raven: Are creditors willing to work with consumers when it comes to paying off debts?

>> I have been doing this for 22 years.

I have found if you have a good relationship with your creditor and you have hit a rough patch, creditors are often more than willing to try and work something out.

They don't want to lose the consumer.

However, if it is a repeat issue, they are going to be much more resistant to offering any kind of repayment plan or any kind of option for assistance.

So it really depends on your relationship with the creditor.

Raven: For the people watching who are not really sure what to do, is filing for bankruptcy advisable for clients?

>> bankruptcy is a great fix for those that need it.

And it is relative.

It is very hard to say as a general term bankruptcy is good bankruptcy is bad.

We see medical debt is the number one cause for filing bankruptcy in this country.

So we know it is not people just spending to spend.

My suggestion would be to reach out to a certified credit counselor to discuss the options, take a look at the dead, see what the different options are.

And if they are good at what they do, they will be honest with you on whether or not bankruptcy is the best route.

Raven: What are three big takeaways for the people watching who are listening who really don't want to be in debt or really want to solve their debt.

What would you advise?

>> first and foremost, don't be afraid to reach out for assistance.

Agencies like Nava core assistance are more than happy to review what the situation is and give you the guidance you need out of the debt or a real program that will do that for you.

The second is waiting to purchase something is not wrong.

We live in a world of instant gratification.

We can order whatever we need at 2:00 in the morning.

If it is important to you and you cannot afford it now, give it some time.

If you still want it just as much, maybe consider it.

But if you can save for it, that is the best way to do it.

Lastly is financial education is really the key to avoiding future debt issues.

Learning about how credit works and how debt builds on itself, and interest, and all of that, is really important.

So I suggest that everyone take a personal finance class if you can, or go online and learn about it.

Raven: Great advice.

Thank you for joining me.

>> Thank you for having me.

Raven: Before we leave you, a look at the top business headlines from the week.

As the second round of anger payments head out to New Jersey families, legislators are thinking about the next steps in property tax relief.

Especially for seniors.

The average property tax payment rose to almost $9,500.

A record high.

This year, more seniors will be able to qualify for the senior freeze program after the government raise the income limit level to $150,000.

Lawmakers are trying to fund the governors stay program which calls for cutting property taxes for seniors in half by.

As budget and finance writer John Mott Myrick swains, recent projections claim paying for these programs may become an issue.

>> and anchor is about a $200 billion line item, senior freeze $200 million more.

They have made a big promise looking ahead to the future to fund something they are calling stay NJ, which would benefit homeowners.

We are at a time right now in a fiscal year, we are starting a new calendar year, halfway through a fiscal year, and the funding questions basically revolve around will the state have the wherewithal to keep spending at this level on property tax relief benefits and do even more in the future?

Revenue collections through the end of November, the closest look we have to today, we are running behind last year at this point in time by a several percentage point.

>> breweries and distilleries may finally get relief from new restrictions they say would hurt their businesses.

During the final days of the lame-duck session, lawmakers introduced a bill that would lift those restrictions while starting liquor license reform.

Something the governor asked for when he vetoed the original bill to lift brewery restrictions.

Under the proposed bill, breweries would have unlimited special events and parties.

They were previously limited to 25.

It would also allow them to offer snacks, and sell nonalcoholic drinks like coffee and soda.

It doesn't go as far as the governor has pushed for, but is still allowed active licenses to new owners and neighboring towns.

The bill would also create licenses for restaurants connected to shopping malls.

That does it for us.

Subscribe to our NJ Spotlight News YouTube channel to get alerted when we post new episodes and clips.

I'm Raven Santana.

Next week, we look at the overall health of New Jersey's housing market, and solutions for the states affordable housing crisis.

Thank you for watching, we will see you next week.

>> funding for NJBB -- business beat brought to you by the partner to New Jersey's manufacturing industry focused on productivity, performance, and strategic development.

More on njmap.org.

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