Brooklyn’s borough president wants to scale back his constituents’ levels of debt, which are already double the national average, by educating them about the pitfalls of credit.
The Federal Reserve Bank of New York’s latest report on household debt and credit said Brooklyn’s debt balance for loans that are more than 90 days late was 10.1% during the second quarter of 2014. By comparison, the rest of the country had a 4.5% balance, the state had a 7.4% balance and the city had an 8.1% balance.
Eric Adams is set to reveal Thursday a multipronged plan to curb the problem that includes a free educational campaign in April. He hopes to decrease the balance by 4% over the next four years.
“Our goal is to bring this attention to Brooklynites,” he said. “I truly believe the lack of financial education is hurting them.”
The credit report, which was released by the federal reserve bank in December, found that credit card debt was the most prevalent form of debt for Brooklyn residents. The credit card debt balance was 11.7% for people in the borough, compared to the national average of 7.8%.
Adams said despite the influx of development and capital into the borough over the past decade, residents, particularly younger and immigrant Brooklynites, don’t know the basics of managing a credit card. The borough president said the common phrase he hears from constituents when he talks to them about credit card debt is “I don’t know.”
“They didn’t know how credit card delinquency could affect their credit scores and any future purchasing,” he said.
Adams will host a series of expos starting April 1 to teach residents how to avoid debt and curb their unnecessary spending.
In June, he will host a roundtable discussion with banks, credit card companies, residents and other leaders to compile a report to the city and state about the best ways to fight predatory loan practices.
Adams stressed that debt is a citywide issue that needs to be taken seriously.
Bronx led the city with a debt balance of 12.9% for loans that are more than 90 days late.
Queens tied Brooklyn with a debt balance of 10.1%, followed by Staten Island with 7.9% and Manhattan with 3.3%.
Adams implored other city leaders to join in and help their constituents.
“We hope that Brooklyn can lead the other boroughs,” he said.
