Borrow Credit Scores

What The F… ICO? Why Our Credit Scores Are Going Up

Jean Chatzky  |  October 20, 2020

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This Week In Your Wallet: What The F… ICO? 

It was January – only January – that a slew of headlines touted the fact that the most recent batch of Bureau of Labor Statistics data showed that women held the majority of jobs in America. Flash forward to September, and we get a sense of the crushing impact the pandemic has had on women in the workforce. Although the economy added 661,000 jobs, 1.1 million individuals dropped out of the labor market. Of them, 865,000 were women. In other words, four times as many women as men left the workforce – including 324,000 Latinas and 58,000 Black women, according to an analysis by the National Women’s Law Center. (That’s not the only impact, BTW, here are 8 other numbers that show the impact COVID-19 has had on women.) 

One big reason for this: Caregiving. Whether you’re parenting children or caring for older parents or other adults, COVID-19 has added to the amount of time spent giving care – and the resulting stress – according to Something’s Gotta Give, a study of 1,600 caregivers in the workforce released yesterday by AARP and S&P Global. Some 60% of those caregivers reported that the amount of time spent on caregiving tasks had shot up since the pandemic closed workplaces, schools, senior and day care centers back in March. And nearly three-quarters said they were feeling a strong or moderate increase in their level of stress. Interestingly, younger caregivers were struggling more trying to balance their work with their lives than older ones.

What’s the solution? Is there a solution? Help from employers definitely moves the needle. Companies that have rolled out flexible work schedules and work locations, along with paid parental leave and/or subsidized back-up childcare or senior care have seen less turnover. But more is absolutely needed. If you’re struggling, the time to reach out for help from your employer is now. There may be policies in place – employee assistance programs, for example -– that you’re unaware of. (Because, c’mon, nobody reads the benefits manual until we actually need it, right?) But you can also ask your HR rep (big company) or boss (small company) for the flexibility or other help you need.And  right now you may actually get it. That’s because – and I say this from the perspective of an employer – hiring is hard. Hiring in a pandemic, when you can’t meet people face-to-face, is even harder. And training people, getting them immersed in your culture etc., is close to impossible. Companies really, really want to keep their good employees, so don’t be shy about asking for what you need. 

Putting Your Money Where Your Mouth Is (Literally) 

Feel that chill in the air? I’m a big fan of the autumnal months, so I’m loving it, but as the temperature drops, and outdoor dining becomes a thing of the past (or a thing only done with expensive, hard-to-buy-right-now heat lamps) your favorite family-owned restaurants are only going to find themselves under more strain. The colder, drearier months are traditionally when many restaurants see an uptick in takeout and delivery orders, all of which have been made easier with online ordering and apps aplenty — but many independently-owned eateries don’t have an online presence, and they simply don’t have the bandwidth right now to update old systems while they’re just trying to stay afloat. 

Thankfully, there are things we can all do to help them hang on. Bonnie Tsui in this week’s New York Times put together an excellent list of options, but here’s a quick rundown: Order straight from the restaurant. If an eatery is hooked up with delivery apps like DoorDash or UberEats, those platforms can take up to 30% of sales. Cut out the middleman, and use your phone for, you know, talking to people. Also, we know delivery is oh-so convenient, but if you can pick up the food yourself and pay cash when you do it, you’ll help a restaurant avoid credit card processing fees, which are usually about 2% of a purchase. Lastly, tip well, purchase gift cards (they really do make great gifts) and ask how you can help. Seriously. Maybe ordering one more meal a month from your favorite place could be the thing that helps them make 2020 work. Or perhaps a simple 5-star online review or picture shared to Instagram could be the thing that lures in a few more hungry customers. 

What The F… ICO? 

The average FICO credit score hit new record highs during the pandemic — In July, scores averaged 711, out of a possible 850. This “may sound crazy,” writes Megan Leonhardt at CNBC, given that this happened when tens of millions of Americans were unemployed, and families were struggling to pay bills and loans. But your FICO score doesn’t really work like that — the scores don’t shift as rapidly as the economy does. Looking at the Great Recession, FICO scores didn’t hit their lowest average until late in 2009, more than a year after the financial crisis began. So, what does this mean? Well, it means that Americans were doing really well before the pandemic hit. But also, according to new data from FICO, we’ve actually done a good job holding the car in the road since. In January, 8.1% of consumers had missed a payment that was more than 90 days overdue… But in July, just 7.3% of borrowers fell into that same category. And over that same January-to-July period, average credit card balances dropped from $6,934 to $6,004. My advice: Keep up the good work, and (as long as you have an emergency stash) keep paying down as much debt as you can, prioritizing credit card debt, until we’re out the other side of this thing. Which can’t come soon enough. 

Have a great week, 


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