It’s your bank or credit union on the line asking for your account information – or is it? It may actually be a spoofing scam!
Let’s take a look at spoofing, how it works and red flags that can alert you to a possible spoofing scam. What is spoofing? Spoofing is the criminal act of disguising a communication from an unknown source to appear as if it’s being sent from a trusted and known contact. The ultimate goal of spoofing is to get the target to share their sensitive information and/or their money with the scammer. For example, a spoofer may pretend to represent a victim’s credit card company and lead them into sharing their account details. Types of spoofing Cybercriminals have a variety of ways to pull off their spoofing. Here are the more common forms: Email spoofingIn email spoofing, an attacker sends an email message that appears to be from a known or trusted source. The emails often include links to harmful websites or attachments that will infect the victim’s device. IP spoofingIn IP spoofing, an attacker tries to gain access to a system by sending messages via a bogus or spoofed ID address appearing to be from a recognized, trusted source, such as one on the same internal computer network. Caller ID spoofingHere, attackers make a phone call to a target that appears to be from a known caller. The scammer will often pose as the victim’s bank or credit union. The victim, believing they are speaking with a representative of their financial institution, will not hesitate to disclose their account information and passwords. Facial spoofing In this most recent form of spoofing, a scammer uses a photo or video of a target’s face to simulate their facial biometrics. This enables them to unlock accounts that can only be opened by facial recognition. Website spoofing In website spoofing, a scammer creates a bogus site that looks just like a reputable site the victim frequents. Attackers lure victims to this site to steal their login credentials and personal info. Text-message spoofingIn this scam, also known as smishing, a victim gets a text message on their personal device that appears to have been sent from a trusted source, such as the victim’s financial institution, place of work or doctor’s office. Deepfakes and spoofing Deepfakes is a relatively new and dangerous tool for spoofers. A deepfake is a fake image, video or audio clip that has been edited to appear authentic. For example, a scammer may create a deepfake video using an image and audio recording of a celebrity to make it appear as if they are telling you to open a link or support a specific cause. Protect yourself Spoofing is a formidable danger for consumers across the economic spectrum, but with the right tools and knowledge, you can avoid falling victim to these scams. Here’s how to protect yourself from a spoofing attack:
Red flags Look out for these red flags that can alert you to a possible spoofing attack:
Stay alert and stay safe!
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It’s that time of year again: Time to clean out those closets, polish that furniture and clear out that clutter! Spring is also the perfect time of year to review your saving habits and spruce up your saving goals.
Here’s how to spring-clean your savings in five easy steps. Assess your saving habits First, take stock of how much you’re putting into savings each month. If you believe you should be setting aside more of your monthly income toward savings, look for ways to cut back on your discretionary spending. Spruce up those savings! Consolidate and simplify accountsNext, take a look at the places you keep your money. If you have multiple savings accounts, retirement accounts or investment accounts, consider consolidating them to streamline your finances and reduce the hassle it takes to manage them all. Be sure to compare fees, rates and other features before making changes. Clean up those accounts! Reevaluate your financial goalsWhat are your long- and short-term saving objectives? Do you still want to go after them? If not, consider setting new ones. Think of your future wants and needs, as well as small pleasures you’d love to enjoy in a few years, or even in a few months. Get those goals sparkling! Automate your savingsNow that you have your saving goals clearly defined, it’s time to make it happen by itself. Set up automatic monthly transfers from your checking to your savings account(s) so you never forget to feed your savings. Make that monthly transfer shine! Use the IRFCU AppBring your savings into the 21st century with the power of the IRFCU mobile app. Our app will allow you to track your savings, review and analyze your spending habits and help you stick to your budget without fail. Taking your savings to the digital level will make you more likely to stick to your goals. Spiff up those saving apps! Spring is in the air – it’s time to make your savings sparkle! Q: What changes can I expect for my retirement accounts and plans in 2024?
A: Here are some changes for retirement plans you can expect to see in 2024: IRA and 401k contribution limits increaseContribution limits for traditional and Roth IRAs are going up in 2024. The limit on annual contributions to an IRA rises to $7,000, up from $6,500. Catch-up contributions for taxpayers aged 50-plus are subject to cost-of-living adjustments (COLA), but these limits remain unchanged for 2024 at $1,000. The boosted contribution limits for IRAs are only available to account holders having a modified adjusted gross income (MAGI) below the set threshold for the year. Contribution limits are also going up for 401k and other employer-sponsored plans in 2024. To read the full scoop on these changes, check out the IRS site. 529 plans can now be converted to RothsIn December of 2022, Congress passed the SECURE 2.0 Act, allowing for a portion of eligible 529s to be converted to a Roth IRA, tax- and penalty-free. Here’s what you need to know:
Starter 401k plans are coming Starter 401k plans, or simplified employer-sponsored retirement plans, are being introduced in 2024. These accounts have lower contribution limits than a standard 401k, but auto-enrollment is required. In addition, employers are not allowed to make contributions to the account. For 2024, Starter 401k limits are set at $6,000 annually, with an additional $1,000 catch-up contribution allowed for account holders aged 50 and older. Employees can contribute an extra $500 to their 401k plan in 2024. Also in 2024, there are more exceptions allowing employees to tap into their 401k plans early without getting hit with penalties – though these distributions are subject to taxation. Updates to full retirement age (FRA) and Social Security paymentsFull retirement age and Social Security payments will see some changes in 2024. First, Social Security payments are jumping by 3.2% due to COLA adjustments. Social Security recipients will receive an average of $1,907 per month, up from $1,848 per month in 2023. Retirees receiving survivors or spousal benefits will also see an increase in benefits. The maximum Social Security benefit will be boosted to $4,873 in 2024, up from $4,555 per month in 2023. In addition, the Social Security tax wage base will see changes. The government will only tax the first $168,600 you earn. Finally, in 2024, $1 for every $3 earned over $56,520 will be withheld for retirees who reach their FRA and hit that amount before their birthday. In addition, retirees earning over $22,320 and falling under their FRA will have $1 withheld for every $2 earned. Use this guide to learn all about the changes for retirement plans in 2024. Are you making any changes to your retirement accounts in 2024? Your home will probably be the most expensive item you’ll ever buy. That’s why it’s of utmost importance that you time your purchase right and learn the best time of year to buy a home. Of course, market conditions, like mortgage rates and the general state of the economy, will significantly impact the price of your new home as well. Here are the best times of year to buy a home.
Winter As the traditional slowest season for the real estate market, winter will generally bring the lowest prices on homes. As one of the few buyers on the market, you’ll also likely have an easier time negotiating a better deal with a seller. Finally, the professionals guiding you through the home-buying journey may be more available to work with you during this slower season, possibly making the process quicker. Buying a home in the winter is not all fun and games, though. First, fewer homes for sale means slim pickings for you. If you’d like to have a wider selection of homes to choose from, winter may not be the best time for you to go house-hunting. Depending on the area of the country you live in, you’ll also be checking out homes and properties in less than ideal conditions. In addition, you’ll have fewer daylight hours to get a feel for the home’s true curb appeal and the amount of natural light that shines into it. Late spring The real estate market really blossoms in the spring. This is the time of year when you’ll see a large influx of new homes on the market. The warmer weather and longer days are ideal for scouting properties, inspecting roofs and exteriors of homes, as well as getting a feel for a community. You’ll also have a robust inventory of homes on the market to choose from. However, shopping for a new home during the warmer months of the year means competing with many other shoppers who can be interested in the same homes you are. This can lead to higher prices, fierce bidding wars and the inability to negotiate for a lower price. Lastly, realtors and title agencies can be swamped during this time of year and may have less time to work with you, resulting in a lengthier buying process. Early summer Early summer is peak real estate season in the U.S., and often sees the most homes sold out of the entire year. The weather is still warm and the days long, making for ideal home-shopping conditions. Shopping for a home in the summer means shopping the homes that are left over from the influx of spring. You may have slimmer pickings, but sellers will also likely be more eager to sell before autumn and winter arrive. Use this guide to learn the best times of year to buy a home. Q: How can I prepare my teen for their first job?
A: Preparing your teen for their first job will help ensure their entry into the working world is as smooth and successful as possible. Here’s how to help your teen get ready for their first job. Talk about their goals Help your teen hash out their goals before looking for their first gig. Sit down with them and ask what they hope to achieve with their job. Defining their goals and expectations will help your teen find and keep the job that suits them best. Find out if they’re eligible Depending on your teen’s age and the protocols of local businesses, your teen may not be able to work at an official position just yet. Many companies only hire employees who are age 18-plus. If your teen is underage, you can guide them toward an unofficial position instead of a real job, such as mowing lawns, walking dogs or babysitting for neighbors. Share salary expectations It’s important for your teen to know what kind of paycheck they can expect to get at their first real job. Explain to your teen that people working for 20 years will earn more than someone working their first job. Talk to them about work experience and how they can anticipate their earning potential growing with the passage of time. Resume polishing Draft a resume with your teen. Ensure it provides info on their education as well as their professional goals and aspirations. Include special skills they possess, along with any extracurricular projects they’ve been involved in and organizations they volunteer for during their free time. Job hunt and application process Once you’ve narrowed down your teen’s skills and work goals, talk to them about effective job-search strategies, such as checking online job boards, visiting local businesses and networking with friends and family. Encourage them to explore part-time, seasonal or entry-level positions that match their interests. Once they’ve found a few possible job options, guide them through the application process, including sending their resume and follow-up emails. Interview prep To help your teen prepare for their first job interview, review common interview questions they can expect and come up with responses that will leave the best impression. Talk about finances Once your teen has landed a job, it’s time to talk finances. Here are some work-related money topics you may want to cover:
Your baby is growing up too fast and wants to look for their first job! No worries; you can still teach them a thing or two. Use this guide to help prepare your teen for their first job. There’s little in life that’s more frustrating than a computer that won’t do its job. But sometimes, like your own private miracle, a message appears on your screen. It says: “Technical difficulties? Click here for assistance.”
Unfortunately, if you follow these instructions, you’ll probably fall directly into a scammer’s trap. Here’s what you need to know about technical support scams and how to prevent yourself from falling victim. How the scams play out In a tech support scam, a target will get an email, text message, pop-up or even a phone call allegedly from a computer technician who works for a well-known company. The “rep” will offer to help with any computer issues they may (or may not) have. They’ll direct the target to call a specific number or click on an embedded link, which will connect them to the “rep” who can supposedly help them. Once connected, the scammer will ask the victim to pay for the services before they’re rendered using a wire, prepaid gift card or cryptocurrency. Once the payment is made, the scammer disappears. Red flags of technical support scams
What you need to know about tech support
Protect yourself Don’t fall for a tech support scam! First, if you run into technical difficulties with your computer, don’t wait for a rep to contact you to offer assistance. Instead, directly reach out to a trusted company. Also, if you believe there may be a problem with your computer, update its security software and run a scan to identify any potential problems. Finally, never provide an unverified contact with access to your device. If you’ve been targeted If you believe you’ve been targeted by a tech support scam, here’s how to mitigate the damage. If you’ve given a scammer remote access to your computer, update your computer’s security software, then run a scan and delete anything that’s flagged as a problem. If you’ve shared your login credentials with a scammer, change all your passwords. You’ll also want to report the scam to the FTC. Stay safe! Q: Should I start investing if I have debt that I am paying off?
A: Here are questions that can help you determine whether you should start investing before getting rid of your debt and various factors to consider when making this decision. How high is your interest rate? Your first consideration when making this decision is the interest rate on your debt. Credit card debt tends to hover at 20%, on average. The stock market, in contrast, has historically returned 10% for investors. When you run the numbers, investing money you could otherwise use toward paying down high-interest debt will generally not make sense. This is especially true when interest rates on credit cards are currently rising. If the interest rate on your debt falls under the 10% mark, it may be worthwhile for you to start investing while still carrying debt. Read on for additional considerations first, though. How much outstanding debt are you carrying? If your debt is so large it’s impacting your budget and making it difficult for you to get through the month, you’ll likely want to pay it off before you begin investing. Carrying a large amount of credit card debt can negatively impact your credit score. What kind of debt are you carrying? Not all debt is created equal. There are some good kinds of debt, which will ultimately increase your net worth or earning power. These include mortgage loans, auto loans, home equity loans that are used for home improvement projects and student loans. On the flip side is bad debt, which will not boost your equity or earning power, such as credit card debt and most personal loans. If you want to start investing but you’re still paying off your mortgage or your auto loan, don’t let these hold you back! As good debt, these loans should not have a negative impact on your credit score and general financial health as long as you continue to make full and on-time payments. What is your retirement timeline? It’s never an ideal time to carry outstanding debt, but it’s especially not recommended to bring debt into retirement. If you’re nearing the end of your working years and you’re still carrying debt, it’s probably best to work on paying it off before you begin investing. How can I invest and pay down debt? The good news is, you don’t necessarily need to wait until you’ve finished paying off all your debts before you begin investing. If you aren’t carrying a large amount of high-interest debt, here’s how you can start investing while paying down debt:
Use this guide to learn when and how you can start investing while still paying down debt. With the right tools and information, building a budget can be quick and easy. Here’s how to create a simple and practical budget for the time-strapped consumer.
Review your income and expenses Most budgeting plans recommend tracking income and expenses for three months. If you’re pressed for time, though, you can choose to look at one month and review your spending and income throughout this time. Review your checking account details and credit card statements to see where your money went and what funds came in. Compare income and expenses Hold up your two numbers from the previous step and see how they compare. If your income outweighs your expenses, you’re doing great! If it falls short, you’ll need to trim your expenses in the next step or look for ways to boost your income. If the numbers balance each other out, it’s still a good idea to trim expenses to leave some budget wiggle room. Assign a dollar amount to every expense category Next, review the ways you spend your money and assign a dollar amount to each category. Include fixed and changing expenses as well as savings contributions. If you’re pressed for time, you can make your categories more broad. For example, instead of setting a separate number for groceries, work lunches and dining out, you can set a larger number for all monthly food expenses. If your income does not cover your expenses, or just barely covers them, look for ways to trim the fat however possible. Jot down your dollar allocation on paper, or create a digital version of your budget and upload it to your personal devices for easy access. Use technology Harness the power of technology to help you track and manage your expenses well. A budgeting app can make tracking your monthly spending super-easy. You can upload your budget to the app and track expenses throughout the month. The app will let you know how much you’ve spent in each category and warn you when you’re approaching the limit. Live with your budget You’re ready to live with a budget! Remember to keep your monthly expense categories in mind as you spend throughout the month. If you find it too hard to keep track of your spending throughout the month, the money envelope system can make it easier. Simply withdraw cash amounts for each non-discretionary expense category in your budget at the start of the month and only use the money in these envelopes to pay for these costs throughout the month. Review and adjust Your budget is up and running! Review your spending plan regularly to see if it’s still working for you and adjust as needed. Budgeting doesn’t have to take a lot of your time or be overly complicated. Use this guide to learn how to create a practical, easy budget that works. In today’s world, where many people spend hours of each day browsing the internet, staying safe online is paramount. The web is rife with scammers employing sophisticated tactics to get at your money and information. Fortunately, with protective measures, you can easily avoid unsafe websites.
Here are six ways to tell if a website is safe. Look for an SSL certificate Secure websites have an SSL, or a Secure Sockets Layer. An SSL is a digital certificate that verifies a website is authentic and will automatically encrypt all personal information and financial data. There are two primary indicators of an SSL, and both are clearly visible in the site’s URL:
Evaluate the URL structure Review the URL carefully. Are there misspelled words? Does the URL mimic a well-known site? Scammers often lure victims by creating bogus sites that look like they represent well-known companies. However, careful scrutiny of the URL will reveal basic spelling errors that give the scam away. Look for the company’s contact info Legitimate companies are eager to have you connect with them for any reason. They’ll generally display their contact info on their home page or provide a link for easy access. Scammers, on the other hand, try to keep themselves as invisible as possible. You likely won’t find any tabs that say “Contact Us” or “About Us” on their website. Check the spelling and graphics Authentic companies will take the necessary steps to make a professional impression on site visitors. Scammers, on the other hand, will not. Use their carelessness to your advantage by looking out for spelling mistakes and typos throughout the site. You can also be on the lookout for cheap design elements, including recycled images and logos that are poorly created. Each of these clues can signify a scammy website. Heed your device’s security warnings If you put a site’s address into your computer, and a warning pop up alerting you that the site you’re attempting to access is unsafe, don’t ignore it. Unless you’re absolutely sure the site is secure despite the warning, it’s best to not advance to the site. Opt out of sites that flood you with pop-ups Scammy websites will try luring you into downloading malware through pop-ups and embedded links. Sometimes, the links will be used to generate ad revenue through clicks. Whatever the intent, it’s important to know that reputable sites will not flood your screen with pop-ups and random links for you to click. If you encounter a site like this, you’re likely looking at a scam. Exit the site, close your browser and have your security system run a scan on your device. Stay alert online and stay safe! It’s tax refund season! How are you going to be spending the pile of cash that Uncle Sam’s giving back?
Before you blow your refund on a sinfully expensive weekend, take a step back and try to determine the best approach you can take with this money. To help you get started, we’ve compiled this list of eight financially responsible ways to use your tax refund this year. 1. Build or boost your emergency fund Having a strong emergency fund is a crucial part of your financial health and stability. If you don’t have a fund with three to six months’ worth of living expenses set aside to cover unexpected events, work on setting one up now. Use some of your tax refund to start building your emergency fund or boost an existing one. 2. Pay down high-interest debt High-interest debt can kill the best of budgets. If you’re carrying outstanding debt with high interest, consider using some of your tax refund to pay it down. 3. Invest in your educationIf you’ve been looking for a way to advance your career and increase your earning potential, this may be your chance. Consider furthering your professional education by allocating some of your tax refund to career workshops, conferences or additional certifications. 4. Feed your savings It’s always a good time to boost your savings, and tax refund season is no exception! Set aside a portion of your refund for your long-term savings to help you get closer to your financial goals. 5. Prepay your mortgageMaking an extra mortgage payment or two can be a great way to free up some money for the long term. Reducing the principal can have an exponential effect on your loan since so much of it goes towards interest over the life of the loan. 6. Make home improvementsSpending some, or even all, your tax refund on improvements that increases the value of your home is an investment in your equity. Similarly, using some of these funds to increase your home’s energy efficiency can pay off for years to come. 7. Start or contribute to a college fundIf you have children, or plan to start a family in the future, consider allocating a portion of your tax refund to a college savings fund, such as a 529 savings plan. Contributions to a 529 plan may be deductible on your state taxes, and earnings are tax-free when used for qualified education expenses. 8. Invest in your retirementIf eligible, consider allocating a portion of your tax refund to your employer-sponsored 401(k) or an IRA. The earlier you start investing for retirement, the more you can potentially accumulate for your golden years. Use our list for some financially responsible ways to use your tax refund. Q: I’m in a bad financial place now, and I sometimes run out of money before the end of the month. Can I neglect my savings for now until my finances improve?
A: For many individuals grappling with financial challenges, the idea of saving money can seem like an unattainable luxury. However, neglecting your savings when the going gets tough can make things even more difficult down the line. Here’s why you should continue saving through financially challenging times and practical steps for making it happen. Why you should continue saving when the going gets tough Be prepared for emergencies Life is a roller coaster ride, and you never know what’s waiting for you just around the bend. Having a financial safety net will help you weather nearly any eventuality with your finances intact. Build financial discipline If money is tight now, chances are you can stand to be a bit more disciplined with how you spend it. Setting aside money for savings each month, even if it’s just a tiny bit, can help foster financial discipline and cultivate a mindset of planning for the future. Practice reaching financial goals When there’s barely enough money to get through the month, saving up for something big can seem ridiculously out of reach. However, setting and reaching small financial goals can be a powerful motivator for fiscal responsibility. How to save during times of financial difficulty Start small Experts recommend putting upward of 20% of one’s monthly income into savings, but if you’re struggling just to make it through the month, you can ignore this advice. Instead, start small, with as much as you can manage a month, and work your way up from there. Look for ways to trim discretionary and non-discretionary expenses If you feel like you’ve already exhausted all opportunities to trim the fat, think again. Look for unnecessary subscriptions, expensive products that can be swapped for cheaper generics and DIY options instead of paying for services and products. Next, review your non-discretionary expenses. Reach out to your insurance companies to negotiate for a lower premium or shop for a new, cheaper plan, and do the same with your phone and internet service providers. Look for ways to conserve energy and make an effort to carpool or move more and drive less to decrease fuel costs. Boost your income Another obvious way to improve your financial circumstances is to make a sincere effort to bring more money home. You may be working a full-time job, but devoting even a few hours a week to a side hustle can make a big difference in your monthly budget. Consider freelancing for hire, working for a ride-sharing company over the weekend or hiring yourself out as a consultant in your chosen field. Explore government assistance In times of financial hardship, it’s essential to be aware of government assistance and support programs, such as food stamps. These programs may provide temporary relief, enabling you to allocate a portion of your income to savings. Seek financial guidance If you find yourself struggling to make ends meet, consider seeking professional financial guidance. Financial counselors or advisors can help you create a realistic budget, explore options for debt management and provide personalized strategies for saving. Use the tips here to learn why and how to save during times of financial stress. Q: Help–tax season is coming! How do I best prepare?
A: It’s great that you’ve started getting ready for tax season way before the deadline, but it sure can be overwhelming. No worries, though; we can help! Here’s how to prepare for tax season. Gather your documents The first step in prepping for tax season is to gather all the necessary documents. Depending on your personal circumstances, these can include:
Store all your documents and receipts in a folder, binder or digital file so you can access them whenever necessary. This will help ensure you don’t miss any deductible expenses. Prepare your personal information In addition to your income information, you’ll need the Social Security number and date of birth of each dependent you claim. It’s a good idea to have this info, and any other details your tax preparer will need, ready before you start your return. Review tax law changes The tax code changes every year, and some of this year’s modifications may impact your tax situation. Be sure to review the most recent updates so you can take advantage of any new deductions or credits. Determine your filing status Your filing status determines the tax rates and the standard deduction you’re eligible to take. Choose the status that best fits your situation. The most common filing statuses are:
Learn the deadlines It’s important to be aware of tax filing deadlines. For most individuals, the deadline to file federal income taxes is April 15th. If the 15th is on a weekend or holiday, the deadline is typically extended to the next business day. Choose your filing method You can file a paper tax return and mail it to the IRS, use tax prep software like TurboTax or H&R Block, hire a professional tax preparer or e-file your return on your own. Plan for next year Finally, use the tax season as an opportunity to plan for the future. Consider adjusting your tax withholding to avoid owing large sums at tax time or receiving large refunds. You’re ready to file your taxes! How do you prepare for tax season? Q: I’m in deep with credit card debt. It feels like I’ll be paying off these bills forever. Is there an end to credit card debt?
A: Yes, you can break free! With the right tools and the willingness to work hard, you can dig yourself out of credit card debt and live debt-free. Here’s how. Assess your debtFirst, review all your open credit card accounts. For each one, jot down the total owed, as well as the interest rate. Tally up the total so you have a number to work with, but hold onto your list for later reference. Negotiate with the credit card companiesNext, reach out to the credit card companies behind your debts to ask about lowering your interest rate or even negotiating to have some of your balance knocked off. Be open about your commitment to pay off your debt and any financial challenges you may be facing. Choose your debt-kicking methodThere are two primary methods for paying down debt:
Review each method and choose the one that suits your lifestyle. Then, reference the list you made in Step 1. Write down your debts in the payoff order you’ll follow. Maximize your paymentsNext, start maximizing your monthly payments toward the first debt on your list. To do this, review your budget and look for ways to cut back. Don’t be afraid to make drastic lifestyle changes as you work on paying down debt. Remember, this is temporary! Another way to find extra funds for your debts is to boost your income by asking for a raise, looking for a better-paying job or a side hustle. As you focus on the first debt on your list, be careful not to neglect the minimum payments on your other debts. Consider debt consolidationIf you have a lot of debt across high-interest cards, consider debt consolidation through an unsecured loan. You’ll use the loan to pay off all your credit card debt, and then you’ll have just one monthly payment to make toward the loan. You’ll likely enjoy a lower interest rate as well. But, only go this route if you know the loan won’t land you deeper into debt. To take out an unsecured loan at Ingersoll-Rand FCU, call, click or stop by today. Use the tips outlined here to kick your debt for good. Q: I’m an avid sales shopper, but after so many Black Fridays spent fighting crowds to chase down deals, but often coming home disappointed, I’m wondering if it’s all worth it. Should I give up the Black Friday shopping?
A: Black Friday has long been hailed as the biggest shopping day of the year, but consumers are rethinking that title. Let’s look at the pros and cons of being a Black Friday shopper so you can make an informed decision. What are the advantages of Black Friday shopping?
What are the disadvantages of Black Friday shopping?
Q: Holiday shopping season is here, but I can’t pay for it all! What’s the best way to fund my holiday shopping?
A: When it comes to covering the cost of your holiday shopping, you have several choices. Let’s take a look at some options and explore the pros and cons of each so you can make an informed decision. Credit cardsFor many shoppers, the most obvious way to pay for a purchase you can’t cover now is with a credit card. Pros:
SavingsDipping into savings to pay for your holiday purchases can free you from sky-high interest charges, but comes with drawbacks. Pros:
Unsecured/holiday loanAn unsecured loan, also known as a personal loan or holiday loan, is a loan that’s taken out with no collateral. Pros:
Holiday club accountWhen you open a holiday club account, you’ll make regular contributions toward your set goal throughout the year, and then have funds you’ll need for covering your holiday purchases when the season arrives. Pros:
When life is comfortable and things are going well, it’s hard to think about experiencing harder times. But failing to plan for stormier days can have a devastating impact on your financial health. Life is full of surprises, and some of them can be expensive. Whether it’s a medical emergency, job loss, car repairs or any other unforeseen event, having a financial safety net can provide a sense of security and stability. Let’s take a look at why it’s so important to save for rainy days.
Stay out of debt Did you know that approximately half of Americans do not have more than $400 saved for emergencies? And yet, emergencies do not discriminate –they can, and do, happen to those who are unprepared just as much as to those who are prepared. When life throws an expensive surprise your way, and you don’t have the funds to cover it, you may fall into debt just to get by. You may choose to swipe the plastic, borrow more than you can afford or fall behind on your monthly payments in order to cover the cost of the emergency. Unfortunately, this can lead to months, or even years, in debt, as consumer debt tends to have high interest rates and can be difficult to repay. On the flip side, if you had a well-padded emergency fund prepared, you would have the cash you needed to fall back on in case of an emergency. This would help you stay out of the debt cycle and keep you financially fit, no matter what life throws your way. Be prepared for sudden unemployment When you live paycheck-to-paycheck, you depend on your job for financial survival. However, unless you are a Justice serving on the Supreme Court, no job is guaranteed to last forever. Your workplace may decide to downsize, close its doors or even to replace you with a bot. Or, you may find yourself unable to work due to personal circumstances. Having an emergency fund in place when you’re gainfully employed can help you stay afloat should you suddenly find yourself unemployed. Flexibility and freedom Saving for a rainy day brings an element of flexibility and freedom to your life. It enables you to pursue new opportunities, take more risks and make major life changes without the constant fear of financial instability. Whether it’s starting a business, furthering your education or taking a sabbatical from work, having this fund will provide the necessary support to explore these possibilities. Peace of mind Financial stress can take a toll on your physical and mental wellbeing. Constantly worrying about money can lead to anxiety, depression, strained relationships and more. Knowing you have an emergency fund built up and on the ready for a rainy day can offer a sense of security and peace of mind. Achieve long-term financial goals Saving for a rainy day is not just about preparing for emergencies; it is also a stepping stone toward achieving long-term financial goals. Whether it’s buying a house, starting a family or planning for retirement, having savings will help you stay on track. Avoid economic downturns related to market fluctuations The economy is subject to fluctuations, and financial markets can be volatile. During economic downturns or recessions, people will often face reduced job opportunities, pay cuts or decreased business revenue. However, an emergency fund can make a challenging economic climate easier to navigate. People who’ve saved up money for emergencies will be less reliant on credit cards and loans during these times, thus reducing their vulnerability to economic uncertainties. If you don’t have a well-padded emergency fund, start building one today! Most experts recommend having three to six months’ worth of living expenses in your emergency fund. Review your monthly expenses to reach this number, and then make a plan for building up your fund until it’s complete. You may want to prioritize your emergency fund over other investments until it’s set up. When the sun is shining, it’s hard to believe the rain will come, but no one’s life is all sunshine, all the time. Saving for a rainy day is a crucial part of financial wellness. Start saving today for a more secure and financially fit life. What kind of emergency will have you running for your emergency fund? Tell us about it in the comments. Buying a home is a long and complicated process, and scammers want to complicate things even more to capitalize on the confusion. Mortgage scams are growing increasingly prevalent and can be difficult to detect. Here’s what you need to know about these scams and how to prevent yourself from becoming a victim.
What’s a mortgage scam? Mortgage scams are designed to deceive individuals who are involved in the mortgage process, including homebuyers, lenders and existing homeowners as they seek refinancing. These scams exploit the complexity of mortgage transactions, possible inexperience and the emotional investment people tend to have in their homes. Types of mortgage scams and how they play out There are several variations of mortgage scams:
Follow these tips to avoid falling victim to a mortgage scam:
When Midge Laurin, of Chicago, Illinois, mailed out a $30 check, she had no idea it would be intercepted by a scammer and written out to someone else to the tune of $9,475. Check-washing scams like this are on the rise, and can leave victims struggling to reclaim their lost funds for months. Here’s what you need to know about these scams and how to avoid them. How the scams play out In a check-washing scam, the target places a check in the mail, and it is then stolen by scammers who nick envelopes from private mailboxes or lift them out of public mailboxes using “fishing rods” made of strings attached to a sticky substance. With check in hand, the scammer uses ordinary household chemicals, like acetone or bleach, to erase the ink off the stolen checks. Finally, they’ll rewrite the numbers and/or the payee before depositing the checks into their own accounts. Sometimes, the scammer will take the ruse one step further by using the checking account details found on the check to commit further crimes against the check-writer. This may include producing counterfeit checks in the victim’s name, as well as fake IDs, driver’s licenses and passports. The victim may only learn about these crimes when they begin receiving overdraft notices or are informed that their ID is no longer valid. Protect yourself Unfortunately, check washing may not be discovered for weeks, or even months after its occurrence. Sometimes, the victim will only learn of the ruse when they review their monthly checking account statement and see that the check amount and/or payee has been altered. Or, they may only find out about it when the intended recipient reaches out to let the check-writer know they still have not received the check. The scam’s discovery is more likely to be delayed when the scammers have not modified any information on the check and have simply stolen and deposited a check made out to “cash”. In addition, many financial institutions do not offer complete protection on fraud that is not reported within a few days of its occurrence. Some offer partial protection for up to 60 days. Ingersoll-Rand FCU Law enforcement agencies on local and federal levels, including the U.S. Postal Inspection Service and the FBI, have task forces to help stop check washing. They offer the following strategies for keeping your checks and your information safe from scams:
Check washing can wreak havoc on a victim’s finances before they even know it’s occurred. Follow the tips outlined here to keep your checks safe. TikTok Inspo: Have you sidestepped a check-washing scam? Tell us your story in a 15-second video. For many people, the mere mention of the word “money” spurs feelings of stress and anxiousness. In fact, a Bankrate study of nearly 2,500 U.S. adults found that 70% of respondents feel stressed about their finances. At the same time, living a financially responsible life can help one maintain optimal mental health. In observation of May being Mental Health Awareness Month, let’s take a look at the connection between money and mental health.
How do financial struggles impact mental health? There are lots of ways money troubles can influence one’s mental health:
How does financial stability impact mental health? Now, let’s explore how financial stability can impact one’s mental health:
The link between money and self-worth Unfortunately, too many people link their self-worth to their financial situation. This can lead to feelings of inadequacy and low self-esteem when experiencing financial struggles. However, it is essential to recognize that self-worth is not tied to financial success. Instead, focus on developing yourself as a person in ways that are not related to your financial situation. Set personal goals, practice self-care and seek fulfillment in areas outside financial success. Debt and mental health Debt is often the most significant financial problem that people face, and it can have a strong impact on mental health. Research shows that people who are in debt are more likely to experience mental health problems like anxiety, depression and even suicidal thoughts. People who’ve been caught in the debt cycle may feel like they are trapped in their situation with no way out. This can lead to feelings of hopelessness and despair. Debt can also cause a great deal of stress, which can lead to physical health problems such as high blood pressure and heart disease. If you are struggling to escape from under a mountain of debt, there are steps you can take to kick your debt for good. Consider consolidating it through an unsecured personal loan that may include one low-interest, and possibly lower, debt payment each month. You can also pay off one debt at a time by maximizing your monthly payment toward that debt until it’s paid off, which is often called the “snowball method” of debt payoff. If you choose this route, be sure to continue making all your minimal monthly payments on your other debts as you focus on the one. Managing your finances for improved mental health Are you struggling with money challenges that are negatively impacting your mental health? Here are ways you can improve your financial and mental health:
TikTok Inspo: How do you maintain your mental health and financial wellness? Share your best tips in a 15-second video. Q: I’ve heard the Biden administration is planning to forgive student loans. What do I need to know about this plan?
A: In August 2022, U.S. President Joe Biden announced his plan to cancel thousands of dollars in student loan debt for qualifying individuals. The plan officially went into effect on Sept. 29, 2022. Here’s what you need to know about Biden’s plan for student loan forgiveness. Is every student eligible for loan forgiveness? According to Biden’s announcement in August, the administration plans to forgive up to $10,000 in student loan debt for individuals earning less than $125,000 a year, and as much as $20,000 for eligible borrowers who are also Pell Grant recipients. For couples, the maximum income eligibility requirement jumps to $250,000 a year. How do I apply for loan forgiveness? Approximately 8 million people already have income information on file with the U.S. Department of Education (DOE); these individuals will likely have their qualifying debts automatically forgiven. All others, however, will need to submit an application with the DOE . Applications can be downloaded here and will take 4-6 weeks to process. The final deadline for submitting applications is Dec. 31, 2023. However, the DOE recommends getting it in before Nov. 15, 2022 . This will give the department enough time to process your application before the student loan payment pause ends and interest starts accruing again on Dec. 31. What kinds of loans are included in Biden’s forgiveness plan? Undergraduate loans, graduate loans and Parent PLUS loans managed by the Department of Education are all eligible for loan forgiveness. It’s important to note, though, that Biden’s plan only applies to federal student loans. This means private student loans are not eligible for forgiveness, even if they began as federal loans. If you’re unsure what type of loans you have, contact your loan servicer to find out. Which income year should I look at to see if I qualify for forgiveness? According to a senior White House official, you can look at the income from 2020 or 2021 to determine whether you fall within the income threshold for loan forgiveness. If I meet the income requirements, will all of my debt be canceled? You may have noticed news items about the loan forgiveness program using language like “up to $10,000 or $20,000 in forgiveness”. This is referring to the maximum amount of loan forgiveness an individual can expect. The rationale behind this language is that some borrowers who fall within the income eligibility may owe less than the full forgiveness amount they are eligible to receive. This means that a student who owes $8,000 in student loan debt and is eligible to have $10,000 forgiven will not be able to pocket the remaining $2,000. Instead, that money will remain with the federal government. I continued paying off my student loans during the payment pause. Is there any way I can get that money back and have more of my loan forgiven? Many borrowers kept up with their loan payments during the pause. With interest paused as well, it was a great way to get ahead on loan payments. Fortunately, these borrowers can still benefit from the new loan forgiveness plan. According to the Education Department’s office of Federal Student Aid, “You can get a refund for any payment (including auto-debit payments) you made during the payment pause (beginning March 13, 2020). Contact your loan servicer to request that your payment be refunded.” Before contacting your lender, though, check to confirm you fall within the income eligibility requirements for loan forgiveness. What steps do I need to take now? If you haven’t yet applied for loan forgiveness, and the DOE does not have your income information on file, you can submit an application here at your earliest convenience. In addition, take these steps to ensure eligibility:
At this time, it’s important to be aware of loan forgiveness scams that will likely arise within the next few months. Be sure to submit your application directly to the DOE through the link provided above, and not to click on links that are embedded in ads or unsolicited emails. In addition, be aware that there is no fee necessary to submit your application, nor is there a need to pay for assistance with your application. Never share your personal information or Student Aid account password with anyone. Biden’s student loan forgiveness plan will bring relief to millions of borrowers. Use this guide to take advantage of this offer and learn what you need to know about the loan forgiveness plan. Your Turn: Will you be applying for student loan forgiveness? Tell us about it in the comments. |
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