Women get advice from Fed representative

Americans may be slipping back into their old spending ways.

As the financial crisis deepened, the nation's individual savings rate began to climb. Spending was replaced by socking money into savings accounts, certificates of deposit and money market accounts.

But those habits may be slipping, according to Jeanne Hogarth, manager for the consumer education and research section of the Division of Consumer and Community Affairs at the Federal Reserve Board.

'As the recovery has begun, the savings rate is down a little bit,' Hogarth said Saturday in remarks before the Money Smart Women Conference at Kirkwood Community College. 'We've also seen polls from market research companies that the 'new normal' will be people stopping themselves and asking 'Do I really need to spend this money now or save it for the future?' 'Any good economist will tell you that you either spend money now or save it to spend later.

Hopefully we have turned some corners when it comes to people thinking about their future.' Hogarth, keynote speaker for the Money Smart conference, prefaced her remarks by saying that they reflected her views and should not be attributed to the Federal Reserve.

The audience of about 35 women in Iowa Hall heard Hogarth discuss recent changes in credit card rules that benefit consumers.

'Credit card companies must give you written notice at least 45 days before they plan to change your interest rate,' she said.

'They also have to warn you that a late payment will require you to pay a fee and could lead to a higher interest rate.' Hogarth said consumers should benefit from knowing how long it will take them to pay off a credit card balance and how much additional interest they will pay if they only make the minimum payment each month.

'This is a fee that is avoidable and could be used to start a college education savings account or make a good start on the down payment for a house.

'By making level payments each month, you can substantially reduce the amount of interest that you will pay,' she said.

Hogarth also addressed changes in ATM and debit card overdrafts as well as gift card expiration.

She urged her audience to share handouts and tips with family members and friends.

Hogarth's speech kicked off a morning of breakout sessions on everything from new financial products to an understanding the role of asset allocation in building a strong investment portfolio.

The Money Smart Conference for Women capped a week of free personal finance events in the Corridor.

The annual week is cosponsored by the Federal Reserve Bank of Chicago and local banks, businesses and non-profit organizations.