- So one thing to think about as you think about
your own financial literacy is what do you do in a situation
where you try to interact with some type of a business
or a financial institution and they either are
misinforming you in some way or they're not doing
what they said they would do?
For example, let's say that you buy something online
and you give the payment, you give the credit card,
and they take the money from you
but they don't send you what you thought
they were going to send you.
Or let's say you buy a product and it breaks immediately
and maybe it's still in warranty,
but they don't really fix that.
Who could you turn to?
Well, the main entity in the United States for that
is known as the Better Business Bureau,
sometimes BBB for short.
And it's actually an independent not-for-profit
but it exists for this exact reason.
If there's a business that you think is doing
not so great business practices,
you can file a complaint with the Better Business Bureau
and they actually will log that complaint
and they keep track the same way that businesses
or financial institutions keep track of your credit score.
The Better Business Bureau keeps scores or ratings
for businesses on how good their business practices are.
And it's somewhat measured by the complaints
that people are putting in on that business
and to what degree those complaints are actually legitimate.
Now, it's not just about buying a product
or whether someone fixes a product or warranty,
there's also situations where people might use
misinformation or maybe not complete information
or not complete education to take advantage
of you the consumer.
There's a lot of situations if you go back into actually
just world history where especially financial institutions
say, hey, give us a little bit of this money
and we'll invest it in really good ways
and it's gonna come out really well,
or we'll give you this loan
and there's no strings attached,
but maybe there are some strings attached.
Or maybe it was a more of a loan than you realized
you were getting into,
or there's certain aspects of the loan
that might get you in trouble.
And to help prevent that there is a federal agency
called the Consumer Financial Protection Board.
It came out of the banking crisis of 2011,
when there were a lot of folks who were kind of
not given all the details or maybe didn't have all
of the necessary information to make a decision
about taking out a big loan
or maybe the interest rate will change dramatically, go up.
They didn't realize the risks that were involved
of taking out a big loan for an asset
that was very speculative.
Maybe the price of that might go down like a house
in an area where the housing prices
have just gone up a lot.
And more extreme examples there's things like payday loans
where fairly vulnerable folks might go into these loans
not understanding the interest involved
which is ginormous, to use a technical word.
So that's what the Consumer Financial Protection Board does
is to make sure that folks are informed,
that people aren't doing misinformation
or taking advantage of people's lack of knowledge.
Now, those are the two big ones on a federal level,
but there's also going to be other groups.
There's groups that help monitor the types of securities
that might get issued.
You might say, well, what's a security?
Well, it's things like a stock or a bond.
And as you can imagine, if there's some kind of
shady company that really has nothing behind it
but says, hey, here's some shares
and these shares are in the newest hot thing
like it's artificial intelligence, biotech,
whatever, whatever, a lot of people might say,
oh, I'm just gonna buy those shares without realizing
there's no company behind it.
And so you also have groups that regulate
things like securities.
You have groups that regulate especially at a state level,
insurance.
It's one thing for someone to say they're going
to insure you and collect your premium,
but when the bad thing actually happens
and you need to get the the payout,
are they going to be there for you?
That's why insurance is pretty regulated to make sure
that the people who say they're offering insurance
are actually good for it.
So you need to be wary, you need to be careful,
but you should also be conscientious
that there are entities out there
that are there to help inform and protect you.