When it comes to personal finance, Americans are most concerned with retiring without having enough money set aside, and also having insufficient “rainy day” savings, according to a recent survey by the National Foundation for Credit Counseling® (NFCC).

Just prior to the COVID-19 outbreak in the United States, the NFCC® conducted its 2020 Financial Literacy Survey, sponsored by Discover Financial Services, and the results offer a snapshot of the state of financial health in the US.

The 2020 Financial Literacy Survey was conducted online within the United States by Harris Poll on behalf of the NFCC® and Discover Financial Services between March 9th and March 13th, 2020 among 2,004 U.S. adults ages 18+.

In addition to those larger, long-term financial goals, some more immediate, everyday personal finance issues continue to be top of mind for Americans. For example, nearly 70 percent of respondents find it difficult to minimize their debt, primarily due to unexpected financial emergencies or reduction of income.

More than 25 percent say that they do not pay their bills on time, the highest percentage since 2012. But almost 70 percent say they pay all their bills on time and have no debts in collection.

And when it comes to credit cards, 62 percent of people have carried credit card debt in last 12 months, up 2 percent over 2019.

Finally, more than 80 percent of US adults agree that they could still benefit from advice and answers to everyday financial questions from a professional, according to the survey.

To that end, consider these tips for managing personal financial issues, like late payments, during challenging times:

Late Payments and Credit Score

Simply put: late payments can affect your credit score. One late payment can identify you as a credit risk, may bring down your score and could remain on your record for up to seven years. Sometimes, just being a few days late may damage your payment record, and being 30 days late will usually be reported to all three credit bureaus, impacting your credit score.

Avoid Missing Payments

For creditors, a single late payment may identify you as more of a credit risk than before. But there are some tools that may help you avoid missing a payment. Set up automatic payments from your checking account to be sure you make your credit card payments on time.

Before you miss a payment deadline, call your credit card company to let them know. If you’re able to explain that this is a one-time occurrence and provide a date when you will make the payment, they may be able to extend the due date, waive the late fee and report your payment status as current.

Actions to Take If You Miss a Payment

It should come as no surprise that the best solution is to get your account current as soon as possible, which means paying the past-due amount. If that’s not possible all at once, talk to your creditor and establish a payment plan over a few months. Some creditors might be forgiving of these sorts of mistakes.

If you miss a credit card payment, there are additional penalties to consider:

  • Late Fees:If you missed a payment, you may see a late fee added to your balance.
  • Penalty APR: Credit card issuers typically can adjust your account to a higher APR if you miss a payment. If your credit card company does increase your APR when you’ve missed a payment, it means that interest will accumulate on the revolving balance faster than before. Be sure to check your credit card’s terms and conditions and make sure you understand the details.

Disruptive situations like natural disasters, sudden unemployment and unexpected medical bills can have a major impact on personal finances and overall financial wellness. But utilizing some basic best practices may help you manage the situation and get through a tough time.

About the Survey: The 2020 Financial Literacy Survey was conducted online within the United States by Harris Poll on behalf of the National Foundation for Credit Counseling and Discover Financial Services between March 9th and March 13th, 2020 among 2,004 U.S. adults ages 18+. Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was used to adjust for respondents’ propensity to be online. Prior to 2013, this survey was conducted by telephone.

Published May 5, 2020.

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