NEW YORK – A bankruptcy judge who has tired of seeing people burdened with credit card debt in his courtroom has decided to do more than help them untangle their finances.
Judge John Ninfo II founded Credit Abuse Resistance Education, or CARE. It sends volunteers from the bankruptcy system – including judges, trustees and private attorneys – to talk to young people around the country about developing good money skills and avoiding debt traps.
CARE is among the 180 organizations that make up the JumpStart Coalition for Personal Financial Literacy. Each April, the Washington, D.C.-based JumpStart marks financial literacy for youth month with conferences aimed at sharing program ideas and visits to congressional offices to urge support for school programs.
Laura Levine, JumpStart’s executive director, said CARE and other groups “do an amazing job, often with few resources,” in trying to bring basic financial skills to the nation’s youth.
She gives the coalition an A for effort, but acknowledges it has a way to go to deal with “a big problem that’s not going to be solved overnight.”
Judge Ninfo uses real stories from his bankruptcy courtroom in Rochester, N.Y., to educate students about the potential dangers of misusing credit cards.
He tells of a couple who didn’t even earn $50,000 a year but ran up more than $50,000 in credit card debt by taking repeated trips to Disney World “to keep the kids happy.” And of an accountant who racked up $80,000 on her credit cards “keeping up with the Joneses and everybody else.” And the man who accumulated $100,000 in card debt but wasn’t worried because he intended to pay it off when he won a lottery.
Ninfo believes stories like these prove his point that the lack of financial literacy has moved beyond the problem stage to the crisis stage.
“We truly have a national epidemic of financial illiteracy in this country,” Ninfo said in an interview. “We in the trenches of the bankruptcy system see it every day.”
The idea behind the bankruptcy professionals’ participation in CARE, he said, was “to be proactive to get the word out to people … instead of being the ones who have to clean up the mess all of the time.”
In a recent talk at the annual convention of the National Business Education Association in New York, Ninfo urged the teachers and school administrators who attended to step up credit education in their classrooms.
Holding a credit card, which he used to punctuate his remarks, Ninfo said he was worried that kids weren’t learning good money management at home or at school so that they risked getting into deep financial trouble when they go out on their own.
It’s not unusual for college students to graduate with more than $28,000 in debt, including nearly $3,000 on their credit cards, according to surveys by Nellie Mae, an educational lender.
Some of those kids don’t pay down their school debts but continue to borrow – eventually ending up in bankruptcy court, Ninfo said.
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