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  • FDIC Encourages Consumers to Save Automatically to Achieve Financial Goals

    The Federal Deposit Insurance Corporation (FDIC) encourages consumers to commemorate America Saves Week by taking advantage of automatic savings to achieve financial goals. Over time, small automatic deposits into a retirement or savings account can add up with compounded interest, helping consumers cover unexpected expenses and build wealth.

    FDIC Chairman Martin J. Gruenberg said: "During America Saves Week, I encourage everyone to establish a financial goal and then make a plan for automatic, recurring deposits into a savings account to help achieve that goal. This is an opportunity for people of all ages. In fact, parents and guardians can guide their children in learning about saving by establishing or strengthening savings account relationships with banks."

    There are a number of ways to take advantage of automatic savings. Consumers who use direct deposit might ask their employers to direct some of their paychecks to retirement accounts or savings accounts. They also might ask their financial institutions to set up recurring transfers from checking accounts to savings accounts.

    America Saves Week also is an opportunity for organizations to encourage consumers to make a savings commitment and provide helpful resources. Each day of America Saves Week focuses on a different savings theme: Save Automatically, Save for Emergencies, Family Savings, Save for Retirement, Saving at Tax Time, and Debt and Credit. The FDIC offers many resources that address these themes, such as the Money Smart financial education curriculum, which includes a "Pay Yourself First" module that focuses on saving.

     To learn more about America Saves Week and savings-related resources from the FDIC, visit https://www.fdic.gov/consumers/assistance/protection/depaccounts/savings/savings.html

  • 9 Tips for Paying Off Your Credit Card Debt

    Buried in credit card debt? You're not alone. According to NerdWallet, in 2015 the average U.S. household with debt had $15,762 in credit card debt at an average 18% interest rate. Annual interest alone was $2,630, or more than $50 a week.

    Here are nine tips on how to climb out. Remember, though, there are no magical solutions.

    Stop spending more than you make

    Tell yourself the truth. Analyze your bills to see where your money is going. Car payments, rent or mortgage, groceries and utilities are essentials; nearly everything else is subject to elimination or reduction. And don't forget those $100 withdrawals from the ATM. Create a realistic budget and declare allegiance to it. Concentrate on the little things; just knocking off a $4 latte on the way to work can save $80 a month.

    Keep paying on the cards

    Failing to pay every month on every card just makes matters worse: The interest goes up and the debt goes up. Always pay at least the minimum listed on the bill. Not doing so may ruin your credit rating, making it harder to borrow money for essentials, such as a car, in the future.

    Concentrate on paying off your smallest debt

    The typical American has about four credit cards, so try pounding away at the one with the least debt. After you pay it in full, stop using it and apply the monthly payment to the next smallest bill. This “snowball effect” is a slow cure but leaves you with a feeling of accomplishment. This method, however, may cost you more in the long run, so read on.

    Pay off the card with the highest interest

    Pretty basic math here. Eliminating debt that costs you 28% is better than killing debt that costs you 18%. Try throwing your entire income tax refund or last month's overtime pay at this bill. Then move on to the account with the next-highest interest rate.

    Consolidate onto a lower-interest card

    This can save you a ton in interest, especially if you eliminate all your other cards. Cards are available that will charge you 0% interest on the debt you have transferred. However, this rate goes up after a specified time, usually 12 to 18 months. In addition, the issuer usually charges a fee — 3% is typical — on the transferred debt. Still, this can be a great deal if you can substantially reduce your debt in a relatively short time.

    Take out a personal loan

    Many lenders, including credit unions and banks, offer unsecured personal loans, meaning you don't have to use your home or car as collateral. However, everything depends on your credit score. Below 620, interest rates will be high, although perhaps still below the rates on the credit cards it will be replacing. It's worth shopping for.

    Try a home equity loan

    This loan, tapping the difference between the sale value of your home and money you still owe on it, also is based on your credit rating, as are home equity lines of credit. In addition, you could lose your home if you default. Consider with caution.

    Cut a deal with the credit card company

    This might be a long shot, but if you have a good credit history with the company and clearly have just fallen on hard times, it might negotiate with you on a lower interest rate. Like any other company, it wants to retain good customers.

    Declare bankruptcy

    This is the nuclear option. Yes, Chapter 7 bankruptcy will eliminate all your credit card debt and leave your home protected from repossession. However, it will be nearly impossible to get a mortgage for five years, and the filing will haunt you for up to a decade if you hope to finance anything at a reasonable rate.

    © Copyright 2016 NerdWallet, Inc. All Rights Reserved

  • Financial Tips for College Freshmen

    If you’re a college freshman living away from home for the first time, you’re probably taking a course you didn’t sign up for: money management.

    You won’t get academic credit for it, but learning skills such as budgeting, choosing the right financial services, and smart credit card usage will benefit you long past graduation. 

    Budgeting: 

    If you’re like most college students, you need to keep an eye on your spending. You can do this by making a budget with pencil and paper, a spreadsheet or an app. 

    First, list your income: It’s likely some combination of savings, cash from your parents or a part-time job and financial aid in the form of scholarships, grants or loans. Then list your expenses, such as tuition, room and board, supplies, laundry and transportation.

    Use the amount left over after you’ve taken care of your expenses to cover food outside your meal plan and entertainment. Set a weekly allowance and hold yourself to it.

    You can also save money – and avoid debt – by using public transportation or ridesharing instead of maintaining a car. Consider borrowing books or buying used copies instead of new ones at the campus bookstore. And take advantage of student discounts whenever possible. 

    Knowing your banking options: 

    Many people still work with traditional banks and credit unions, but there are also online alternatives. And even old school financial institutions build apps that let you track your accounts and transfer funds.

    You can also download apps that let you analyze multiple accounts at different institutions, such as Level. You can find a list of some other personal finance apps here

    Building credit: 

    Having good credit can give you access to more — and more affordable— rental properties, car loans and insurance. Using a credit card responsibly is a relatively easy way to build it.

    If you can’t qualify for a credit card, either because you’re too young or because you don’t have enough credit history, you still have options. You can get a secured credit card, become an authorized user on a friend or family member’s card or find a co-signer willing to cover for you if you default on a payment.

    A credit card can give you short-term, interest-free financing – assuming you pay the balance in full each month. But paying only the minimum causes you to run up debt and interest charges and will hurt your credit. Treat credit cards as you would a debit card or cash.

    It’s always important to be careful with your money, not just when you’re in college. If you establish good habits early, you’ll be in excellent shape as you graduate and start your career.

    © Copyright 2016 NerdWallet, Inc. All Rights Reserved

  • Gallup: Two-Thirds of Americans Prefer Saving to Spending

    The share of Americans who say they prefer saving to spending rose to an all-time high of 65 percent, according to a Gallup poll yesterday. The rise continued a marked post-recession trend, versus steady figures in the early 2000s showing that the share of spenders and savers was equally matched.

    Saving has continued to rise in popularity as Americans rebuilt their finances following the recession, with 50 percent of respondents rating their personal financial situation as excellent or good for the first time since 2006. Saving is also preferred among all generations, with 66 percent of those aged 18-29 saying they enjoy saving more than spending. In the early 2000s, 54 percent of that age bracket said they preferred spending.

    “Americans are considerably more likely than they were in the easy-credit years preceding 2008 to perceive saving money as more enjoyable than spending it,” Gallup said. “And their actions have, at least to some extent, mirrored their attitudes. Saving rates that had dropped from the double-digit levels of the 1960s and 1970s down to an abysmal 1.9 percent rate in July 2005 are now consistently close to or above 5 percent.” View the survey results.


  • 12 Tips for Protecting Your Mobile Devices

    As consumer use of mobile devices continues to climb, cyber criminals are targeting those gadgets more frequently. According to a report by the Federal Reserve, 52 percent of smartphone users say they have used mobile banking in the past 12 months. In recognition of National Consumer Protection Week March 6 - 12, First State Bank is highlighting 12 ways consumers can take extra precaution to protect the data on their mobile device.

    First State Bank uses gold-standard safeguards to protect customer information, but it’s also important for users to keep safety measures in place on their end to prevent sensitive data from being compromised. It’s easy to forget that your mobile device can be vulnerable, but any device used to connect to the Internet is at risk.
    First State bank suggests following these 12 steps to protect your mobile device:

    • Use the passcode lock on your smartphone and other devices. This will make it more difficult for thieves to access your information if your device is lost or stolen.
    • Log out completely when you finish a mobile banking session.
    • Protect your phone from viruses and malicious software, or malware, just like you do for your computer by installing mobile security software.
    • Use caution when downloading apps. Apps can contain malicious software, worms, and viruses. Beware of apps that ask for unnecessary “permissions.”
    • Download the updates for your phone and mobile apps.
    • Avoid storing sensitive information like passwords or a social security number on your mobile device.
    • Tell your financial institution immediately if you change your phone number or lose your mobile device.
    • Be aware of shoulder surfers. The most basic form of information theft is observation. Be aware of your surroundings especially when you’re punching in sensitive information.
    • Wipe your mobile device before you donate, sell or trade it using specialized software or using the manufacturer’s recommended technique. Some software allows you to wipe your device remotely if it is lost or stolen.
    • Beware of mobile phishing. Avoid opening links and attachments in emails and texts, especially from senders you don’t know. And be wary of ads (not from your security provider) claiming that your device is infected.
    • Watch out for public Wi-Fi. Public connections aren't very secure, so don’t perform banking transactions on a public network. If you need to access your account, try disabling the Wi-Fi and switching to your mobile network.
    • Report any suspected fraud to your bank immediately.

     

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