Data breaches show up in the news almost as often as celebrity couple breakups. According to Risk Based Security’s Mid-Year Data BreachReport, there were 1,767 publicly reported breaches in the first half of 2021, exposing 18.8 billion records. One of the most far-reaching of these breaches was the T-Mobile data breach in August, which has impacted more than 50 million people.
A data breach exposes confidential information of its victims, which can include Social Security numbers, account information, credit card numbers, passwords and more. If your personal information has been compromised by the T-Mobile data breach or another exposure, take these five steps to mitigate the damage. Step 1: Read all alerts and notifications from the compromised company The business whose data has been compromised in the breach will generally reach out to all potential victims to notify them about the exposure. They may instruct all recipients of this missive to check for signs that their information has been exposed and/or direct them toward their next step. If you believe your information may have been compromised in a breach, it’s important to read every message you receive from the exposed company. Step 2: Alert your financial institution Next, let Ingersoll-Rand FCU know your account may have been compromised. This way, we’ll know to keep an eye out for signs of fraud and place an alert on your account. We’ll be watchful of requests to approve any large transaction or withdrawal, and we’ll contact you if we notice any suspicious activity. Step 3: Change any exposed passwords A data breach generally means passwords of all kinds have been compromised. It’s best to change as many as possible after a breach to keep information and money safe. The quickest way to do this is by using a password manager, which allows you to store unique, complex passwords for each account. Although it’s important to have a different password for each account, it’s best to start by changing passwords you know were a part of the data breach. Step 4: Consider a credit freeze A credit freeze alerts lenders and credit companies to the fact that you may have been a victim of fraud. This added layer of protection will make it difficult, or impossible, for hackers to open a new credit line or loan in your name. You can freeze your credit at no cost with all three of the major credit bureaus, Equifax, Transunion and Experian. You’ll need to provide some basic information and you’ll receive a PIN for the freeze. Use this number to lift the freeze when you believe it is safe to do so. Step 5: File an identity theft report If your accounts have been compromised and you believe your identity has been stolen, file an identity theft report with the Federal Trade Commission (FTC) immediately. This will assist the feds in tracking down the scammers responsible for the data breach. It will also help you return your finances to their usual state as quickly as possible. Take these precautionary measures to protect your information from future data breaches of any kind:
Your Turn: Has your personal information ever been exposed in a data breach? Tell us about it in the comments.
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You and debt are so over. You’ve just about had it with those endless piles of credit card bills and those hideous numbers that never seem to get any lower. It’s time to kiss that debt goodbye!
Getting rid of high debt will take hard work, willpower and the determination to see it through until the end, but it is doable. Here, we’ve outlined six steps to help you start crushing debt today. Step 1: Choose your debt-crushing method There are two approaches toward getting rid of debt:
Step 2: Maximize your payments Credit card companies are out to make money, and they do this by making it easy to pay just the minimum payment each month, thus really paying only the interest without making progress on the actual principal, thereby trapping millions of consumers in a cycle of endless debt. Beat them at their game by maximizing your monthly payments. Free up some cash each month by trimming your spending in one budget category or consider freelancing for hire and channel those freed-up or newly earned funds toward the first debt on the list you created in Step 1. Don’t forget to continue making minimum payments toward your other debts each month! Step 3: Consider a debt consolidation loan If you’re bogged down by several high-interest debts and you find it difficult to manage them all, you may want to consider consolidating your debts into one low-interest loan. A personal loan from Ingersoll-Rand FCU can provide you with the funds you need to pay off your credit card bills and leave you with a single, low-interest payment to make each month. Or, you can transfer your credit card balances to a single card with a low-interest or no-interest introductory period. Be aware, though, that you will likely get hit with high interest rates when the introductory period ends. Step 4: Build an emergency fund As you work toward pulling yourself out of debt, it’s important to take preventative measures to ensure it won’t happen again. One of the best ways you can do this is by building an emergency fund. Ideally, this should hold enough funds to cover your living expenses for three to six months. Start small, squirrelling away whatever you can in a special savings account each month, and adding the occasional windfall, like a work bonus or tax return, to beef up your fund. Step 5: Reframe your money mindset Sometimes, like when there’s a medical emergency or another unexpected and expensive life event, a consumer can get caught under a mountain of debt through no fault of their own. More often, though, there is a wrongful money mindset at play leading the consumer directly into the debt trap. As you work on paying off your debts, take some time to determine what got you into this mess in the first place. Are you consistently spending above your means? Is there a way you can boost your salary or significantly cut down on expenses? Lifestyle changes won’t be easy, but living debt-free makes it all worthwhile. Step 6: Put away the plastic Credit cards are an important component of financial health and the gateway to large, low-interest loans. However, when you’re working to free yourself from debt, it’s best to keep your cards out of sight and out of mind. You can set up a fixed monthly bill to charge one or more of your cards to keep them active, but only do this if you know you will pay off the charge in full before it’s due. Learning to pay your way using only cash and debit cards will also force you to be a more mindful spender. Kicking a pile of debt can take months, or even years, but there’s no life like a debt-free life. Best of luck on your journey toward financial freedom! Your Turn: Have you kicked a significant amount of debt? Tell us how you did it in the comments. With mask mandates and occupancy limits easing and/or lifting, millions of Americans are looking forward to a summer getaway with more excitement than usual. Entertainment venues are opening, attractions are up and running again and for some, it’s been two years since they’ve enjoyed a real summer vacation.
While it’s great to get away for some fun in the sun, it’s important to stick to a budget, even when on vacation. An over-the-top vacay you can’t really afford can mean spending months catching up on credit card payments and paying high-interest rates that may make it not worth the price. This year, attack your vacation with a financial plan that you can actually keep by following the tips outlined below. Rethink your vacation Everyone needs a time-out from the daily grind, but for those who are struggling just to get through the month and don’t have any money socked away for vacation, it may be a good idea to consider an alternative to a conventional getaway that can provide an escape from real life without the prohibitive price tag.
Create a budget If you absolutely need to splurge on a real getaway, here’s how to create a realistic budget for your vacation.
Stick to your budget while on vacation Now comes the hard part: sticking to your budget while on vacation. Fortunately, with careful planning and willpower, this is not as difficult as it sounds. Here are some tips: First, consider using cash only while on vacation. You’ll be forced to stick to your budget with no way to overspend. If you’re anxious about traveling with limited funds, you can keep a card at the back of your wallet, but be sure to keep it strictly for emergencies. Also, make sure you have a plan to keep your cash secure at all times since cash is not recoverable if lost or stolen. Next, make reservations for whatever you can while you’re still at home. Think hotel, car rental, entertainment venues, and more. This way, you’ll leave fewer spending choices to make when you’re actually on vacation. Finally, keep a copy of your vacation budget handy for easy reference throughout your vacation. Pull out your budget for review whenever you come up against a spending challenge. Planning and sticking to a vacation budget will help make your time away so much more enjoyable. Instead of stressing over paying back sky-high credit card bills when all the fun is over, you can rest easy, knowing you’re covered and that you’re spending within a budget. This summer, enjoy the getaway of a lifetime, but don’t let your budget go on vacation. Your Turn: Share your best vacation-budget tips with us in the comments. One of the most important parts of setting up a monthly budget is separating needs from wants. Before assigning dollar amounts to any categories, it’s important to know which parts of your monthly expenditures are an absolute need, and which items would be nice to include, but are not a necessity. Many people find this particularly challenging, and many even give up on budgeting when they can’t move past this step.
Fortunately, it doesn’t have to be this way. Below, we’ve outlined how to tell the difference between wants and needs, as well as how to separate these two categories on a monthly budget plan. Defining needs and wants A need is something that is necessary to live and function. A want is something that can improve your quality of life. Using these criteria, a need includes food, clothing, shelter and medical care, while wants include everything else. However, as you’ll find when creating a budget, these terms are more fluid than they appear to be at first glance. While working through your lists, you may find that some items can fit into both categories, making the process confusing. A good trick for dividing wants from needs is to let some time pass before fulfilling your desire for the item, either theoretically or practically. The desire to obtain a need only grows stronger as time passes, while the desire to fulfill a want will weaken with passing time. Listing your needs and wants Now that we’ve defined each of these budget categories, you can begin listing your own needs and wants. Start with your needs, including the basics, like food, rent or mortgage, as well as other fixed expenditures that are necessary for you to live and function. Those things may include transportation costs, health insurance coverage and any clothing or tools you need for work. It’s important to note that needs will vary from one person to another, and even for one person at different stages of life. For example, a family with two working parents who live in a community where there is no reliable public transportation may require two vehicles. Conversely, a family living in a city with several dependable transportation systems may list a second car as a want. Similarly, a four-bedroom home may be a need for a family while they’re raising several young children, but turn into a want later when the kids go off to college. If you get stuck on a particular item and don’t know where to place it, hold it up to the following questions:
After completing this exercise, review your list of needs to see if anything can be removed. Will you still need these items a few years from now, or even a few months from now? Can any of your needs be swapped for a cheaper option? For example, you may need clothing, but do you need eight pairs of designer jeans? Do the same for your list of wants. Which of them are only there because of pressure to keep up with others or look good? Which of your wants were more important to you in the past than they are today? Which are status symbols? Pare down your list until you’re only left with the wants that truly add value to your life. Now that you know how to tell the difference between needs and wants, creating a monthly budget is simple. Assign dollar amounts to your fixed and non-fixed needs, set aside money for savings and use the rest to pay for your wants. Going forward, you’ll likely also have an easier time keeping your impulse buys under control. Before purchasing an item, ask yourself if it’s a need or a want. If the item is a want, consider its importance and other wants you’ve recently bought before going ahead with the purchase. Separating wants and needs can be one of the most challenging parts of creating a monthly budget. Follow the steps outlined above to learn how to make the distinction between these two spending categories with ease. Your Turn: How do you separate wants from needs? Share your tips and tricks with us in the comments. Re-acclimating to normal life as pandemic restrictions are lifted and businesses reopen across the country will mean more than just getting used to wearing real pants again and working without your cat on your lap. You’ll also need to consider your finances. How has your overall money management changed during the pandemic? Have you dipped into your savings? Have you been letting your retirement accounts slide? Or, maybe you’ve been waiting for the chance to hit your favorite retailers again, and you can’t wait to splurge after a 15-month financial fast.
As you prepare to leap back into normal life, proceed with caution. Be sure to consider your full financial picture as well as long-term and short-term goals. Here are some forward-thinking money moves to make as you adjust to post-pandemic life. Review and adjust your budget Pandemic times required their own budget, as people cut down on costs like dining out and updating work wardrobes, but spent more on things like at-home entertainment. Others may have had to adjust their spending to fit a changed income level or to help them coast during a stint of unemployment. The pandemic may have also shifted something in some people’s mental list of needs and wants, as they found they can live with a lot less than they’d believed. As you adjust to post-pandemic life, take some time out to review and tweak your monthly budget. Be sure to incorporate any changes in income, as well as a readjustment to pre-pandemic spending or changed priorities. You may need to review and adjust your budget, and maybe even your spending behaviors, every few months until you find a working balance. Rebuild your savings If you are one of the many Americans who were forced to dip into savings, or even to empty them completely, during the pandemic, create a plan to get your savings back on track. Tighten up your spending in one area until you’ve built up an emergency fund that can keep you going for 3-6 months without an income, or use a windfall, such as a work bonus or tax refund, to get the bulk of your emergency fund in place. Once your emergency fund is up and running again, continue to practice basic saving habits, such as setting aside 20% of your monthly income for savings, or whichever approach you prefer. If the pandemic taught us anything, it’s that it’s always best to be prepared, because you never know what can happen. Rethink your long-term and short-term financial goals The pandemic has prompted many people to reevaluate their goals. Retiring before you hit 50 or spending a month in Europe next summer may not be as important to you as you’d originally believed; or it may be even more important now. Similarly, you may realize your family has outgrown its living space and that moving to a new home is your number one financial priority. Or maybe you’ve decided you can live without a second car. Take some time to rethink your long-term and short-term financial goals and adjust your savings and budget accordingly. As you move through this step, be sure to consider any long-term goals you may have put on hold during the pandemic. Have you stalled your contributions to your retirement accounts or toward your child’s college tuition fund? Have you been making only the minimum payments on your credit cards? If any of these apply to you, be sure to revert your savings and debt payments back to pre-pandemic levels as soon as you can. Spend with caution It’s perfectly fine to enjoy a shopping spree in celebration of a return to pre-pandemic norms, but it’s best to spend with caution. First, prepare to encounter inflated prices wherever you go. Gas prices have jumped recently, and costs of many consumer goods have spiked as well. If you planned to purchase a big-ticket item like a new car or tickets for a cruise, consider waiting it out a bit until prices cool off. Also, you may be eager to make up for lost time, but no amount of nights out on the town will bring back the months you spent at home. Similarly, overbuying for this fashion season won’t bring back the seasons you spent at home in a hoodie and sweatpants. To avoid irrational overspending, set up a budget before you hit the shops and only spend what you’ve planned. The restaurants and movie theaters are open for business again, and mask mandates are dropping all over the country. As life returns to pre-pandemic norms, be sure to consider the state of your finances and to make responsible, forward-thinking money moves like those listed here. Your Turn: What post-pandemic money moves will you be making now? Tell us about it in the comments. Are you constantly dealing with a barrage of junk mail that clogs up your mailbox? Drowning in papers needing sifted through? Are you always afraid to throw out any paper from your financial institution, fearful that you’ll be throwing sensitive material into the trash and making it an easy steal for would-be scammers?
If this sounds familiar, you may benefit from switching to electronic account statements. Electronic statements (eStatements) are similar to paper statements, except for the fact that they’re delivered electronically. At the end of each statement period, which is generally monthly for checking accounts and quarterly for basic savings accounts, you’ll receive a notification from the credit union informing you that your statement is ready to view through the online banking portal, app, or by downloading from a secure site. Once you access the eStatement, you’ll find it has all the information you’re used to receiving in your paper statements. You can also access your eStatement by logging into your online banking site or app at any time throughout the month. Quick, convenient and clutter-free, eStatements are the way of the future. Here are six reasons to consider switching to eStatements. 1. Check your accounts at a glance With eStatements, there’s no need to wait for your monthly statement to arrive in the mail. Just a few clicks and you get your account statement at any time, from anywhere, using the mobile device of your choice. Some financial institutions also offer members the option of signing up for financial alerts, such as a warning when your account is running low and in danger of being overdrawn. With eStatements, managing your accounts is easy. 2. Clear out the clutter Why bother with piles of paperwork when you can access your accounts online? It’s neater, cleaner, and helps cut down on the correspondence you have flooding your mailbox. You’ll also save time sorting through papers when you can find your last account cycle balance with just a few quick swipes. 3. Keep your information safer No matter how careful you are with papers containing sensitive data, there’s always a chance you can miss something and it’ll end up in the wrong hands. It can also be a pain to keep track of every incoming piece of snail mail and to dispose of it properly. With eStatements, you’ll never have to worry about losing a paper that contains confidential banking information, or mistakenly tossing it into the trash where it can be easily accessed by identity thieves. Some people are wary about sending sensitive information online and are fearful that an eStatement can easily be hacked. However, you can access your account balance online with confidence, knowing that Ingersoll-Rand FCU uses several layers of protection to keep your information absolutely safe, including multi-factor authentication, encryption, and sign in reporting. 4. Monitor your accounts frequently for fraud When you have instant access to your accounts throughout the month, it’s a lot easier to check for signs of fraud. Plus, when you spot the fraud sooner, you can take steps to mitigate the damage earlier and have a better chance of a full recovery. 5. Eco-friendly When you choose to receive your monthly account statements electronically, you’ll be doing the environment a favor. Less paper statements means less paper waste and fewer trees getting felled for something that will ultimately be tossed. Go green for the environment with eStatements! 6. Safe and secure storage Filing cabinets are so last century. With eStatements, you’ll never stress about misplacing your account statements again. Your online banking portal or app acts as a convenient and secure filing cabinet, storing your account statements for you to access as needed. Ready to make the switch to eStatements? Signing up is easy! Just follow the instructions here. Your Turn: What do you like best about eStatements? Tell us about it in the comments. For the green-thumbed homeowner, there are few things as pleasurable as running fingers through soft, moist earth, catching sight of the first flowering buds of spring and inhaling the scent of freshly cut grass.
Tending to a lawn and garden can get expensive. Between seeds, fertilizer and gardening supplies, costs can be high enough to take the pleasure out of lawn care. Here are 10 creative ways to save on landscaping, so you can have your well-tended lawn and your budget, too. 1. Plant perennials Go green with your garden by choosing plants that flower year after year. You’ll have to pay more out of pocket when you first plant these blooms, but the cost-free plants you’ll have each year will more than make it worth the price. 2. Make your own compost Mulch and other soil products may keep your garden healthy, but they’re not as kind on your wallet. Save money by going the DIY route with compost. All you need is a designated outdoor bin to collect your old fruit and veggie peels, plant clippings and dead leaves. After a few weeks, you should have a pile of nutrient-rich soil ready to give your garden the boost it needs to grow and glow. 3. Grow and trade For a colorful variety of flowers, plant perennials that grow and multiply quickly, like Hostas or Daylilies. Within a few years, you should have more of these flowers and plants than you need. Then, you can trade them with friends and neighbors for new and interesting plants. 4. Propagate your plants Grow your garden by helping your plants propagate. You can do this by separating an already growing plant into two and replanting; rooting a leaf or rooting a small stem with leaves. You can propagate new plants in soil or in water. Find out more about propagating here. 5. Choose plants that are natural to your region For lower-maintenance plants, choose species that grow naturally in your area of the country. You’ll save on extra watering, soil correction and special plant food. 6. Shop the end-of-season sales The plants in the nursery and home improvement store won’t look too attractive in the fall, but that doesn’t mean they’re useless. Plants that look wilted now can grow beautifully in the spring, as long as the roots are alive and well. Best of all, you can score these healthy plants at bargain prices. While you’re shopping during the fall sales, you can pick up discounted potted plants, planters, gardening tools, lawn chairs and more. 7. Leave your grass clippings Looking for an easy and cost-free way to improve your lawn? You already have one! Just leave your grass clippings on the lawn after mowing instead of cleaning them up. The clippings will break down quickly, adding organic matter and nutrients to your grass. 8. Don’t cut your lawn too short Shorter grass attracts more weeds and will need more herbicides. Higher grass will shade out those pesky weeds while also developing a deeper root system, thus requiring less watering. Keep your grass at 2- 2 ½ inches for best results. 9. Pay attention to pH It’s important to measure and control the pH level of your lawn. If the ground is too acidic or alkaline, your plants and grass won’t absorb nutrients, no matter how much fertilizer you feed them. Ideally, pH levels on lawns should be between 6.5 and 7. If your lawn’s pH level is too high or too low, you can add lime or sulfur to correct it. 10. Save extra flower seeds Bought too many seeds to plant this year? No worries; you can save them for another year! Most flower seeds will keep well if stored in a cool and dry place. You can even buy seeds in bulk with plans to save the extra for a more cost-effective purchase. Gardening is fun and rewarding — and it doesn’t need to cost a lot of money. Use our tips to cut back on landscaping costs without compromising on the health of your lawn. Your Turn: How do you save on landscaping costs? Share your best tips and tricks in the comments. Love the holidays but hate the Santa sticker shock that follows? No need to spend your way into debt this Christmas. Keep costs down and make the holidays more meaningful by gifting your loved ones with personalized homemade presents.
From pamper-me packages crafted with care, to home décor that costs just a few dollars, to home-baked goodies that say “I love you,” the sky’s the limit when you DIY! Here are 13 homemade gift ideas from across the cyber-verse to get you started. Sugar cookie sack Everyone loves pulling freshly baked cookies out of the oven, but who wants to bother with measuring and mixing all those ingredients? Make it easy for your loved one with this adorable sack of sugar-cookie mix. Decorate the sack to make it personal, and you’ll have a heartwarming gift costing less than $10. Fleece blanket Help your friends and family gear up for winter with a cozy fleece blanket. If you’re handy with a needle, you can design a deluxe version of this fuzzy piece of heaven; otherwise, keep it simple, sweet and oh, so cheap. Pedicure kit Has your friend been pining for a pedicure? Gift them with all they need to make their nails sparkle with a “for your mistletoes” nail kit! Fill a $7 Mason jar with polishes, filers, a buffer and everything else they need for a spa-at-home experience. Wall clock Dress up a flat circle of wood with some beautiful material, attach a clock kit and voila — homemade designer décor for just a few dollars! This clock makes the perfect gift for the friend who’s just moved into a new home or dorm room. Learn how to make your wall clock here. Bubble bath gift set Who doesn’t love a relaxing bubble bath? This gift makes it possible with a complete bubble bath kit, including chocolate, bath salts, a candle, soaps, a pouf and more. Learn how to create your own at Sugar and Charm. Instagram picture frame Round up your friend’s best Instagram snaps of the year with this creative desktop frame. This gift will make them smile all year long. Infused vodkas Flavor your own vodkas and give your friends a unique gift they’ll enjoy for days to come. Choose between classic flavors or experiment with brave new ideas, like spicy citrus and cucumber tarragon. Get the tutorial for infused booze here. Money tree Who says money doesn’t grow on trees? Give the gift of cash with an adorable holiday-themed presentation by rolling up stacks of bills into tree boughs. Learn how here. Recipe box This one is for the friend who dreams of starring on “Chopped.” Fill this personalized, decorated recipe box with their own best recipes and add a few new gems for their collection. They’ll think of you every time they cook up another storm. Check out Club Crafted to get the full tutorial. Snowball bath bombs Bath time is fun again with these peppermint-infused bath bombs! Package inside plastic ornaments for a real holiday treat. Rainbow candles We’re all spending more time at home these days, and what better way to light up a cold winter evening than with these gorgeous rainbow candles? All you need for these eye-catching creations is a bit of time and some old crayons. Painted picture frames Dress up dollar-store picture frames with colored chalk paint for the perfectly memorable gift. Learn how at Make Your Mark. Reindeer gift card holder This holiday-themed card holder is the perfect present for that friend who owns a collection of gift cards and needs a place to keep them safe. You can also use it to dress up a gift card and make it more personal. It’s made out of leftover toilet paper rolls and basic craft materials you likely already have at home. Keep the stress out of the holidays this year with our DIY gift hacks. It’s all the shared love with none of the debt. Plus, creating these gifts will keep you busy as you ride out a quarantine or avoid crowded malls during these pandemic times. Who knew holiday gifts could be so much fun? Unless you’ve been living in a bunker for the last several months, you’ve likely caught the term “recession” thrown around on the news more than once. Hearing this word being used to describe the state of the U.S. economy can trigger a range of reactions from mild anxiety to a full-blown stuffing-money-under-the-mattress panic.
For many people, though, part of their angst surrounding the state of the economy is the vast amount of unknown: What is the exact definition of a recession? How is it different from a depression? How long do recessions usually last? What causes a recession? So many questions — but we’ve got answers! Here’s all you need to know about recessions, the current state of the U.S. economy and what all of this means to you as a private consumer. What is a recession? A recession is a widespread economic decline in a designated region that lasts for several months or longer. In a recession, the gross domestic product (GDP), or the total value of all goods and services produced in the region, decreases for two consecutive quarters. A healthy economy is continually expanding, so a contracting GDP suggests that problems are brewing within the economy. In most recessions, the GDP growth will slow for several quarters before it turns negative. What’s the difference between a recession and a depression? A depression has criteria similar to that of a recession, but is much more severe. For example, in both a recession and a depression the unemployment rate rises; however, during the Great Recession of 2008, the worst recession in U.S. history to date, unemployment peaked at 10%, while during the Great Depression, unemployment levels soared to 25%. Similarly, during the Great Recession, the GDP contracted by 4.2%, while during the Great Depression it shrank by 30%. Depressions also last a lot longer than recessions. The Great Depression officially lasted for four years but continued to impact the economy for more than a decade. In contrast, recessions generally last only 11 months, according to data from the National Bureau of Economic Research (NBER). There have been 47 recessions in U.S. history, and a total of 13 recessions since the Great Depression. There has only been a single recorded depression in our country’s history. What causes a recession? A recession can be triggered by a variety of factors:
Why the COVID-19 recession is unlike any other? In June 2020, the NBER announced that the U.S. economy had been in recession since February. The COVID-19 recession, also known as the coronavirus recession, the Great Shutdown, the Great Lockdown or the Coronavirus Crash, is unique because it was sparked by an unforeseen pandemic and not by any inherent problem within the economy. Another anomaly of the coronavirus recession is the super-healthy state of the economy before it hit. In February, unemployment levels were at a 50-year low, stock markets were at a record high and the U.S. economy had enjoyed 126 months of growth, its longest period of uninterrupted expansion in history. The unusual triggers and the explosive start of the current recession may be good news for its eventual end. Economists initially were hopeful that the recession could reverse itself quickly with a V-shaped recovery. Unfortunately, due to prolonged lockdowns and the nationwide failure to keep infection rates down, they have since declared that a rapid rebound is unlikely. There is still hope for a relatively fast recovery. An April Reuters poll found that nearly half of 45 economists believed the U.S. recovery would be U-shaped: slower and more gradual than a V-shaped recovery, but still fairly quick. How will this recession affect me? The coronavirus recession can impact the average consumer in multiple ways. First, many are struggling with sudden unemployment or will be facing joblessness in the coming months. The most recent data from the Bureau of Labor Statistics show the unemployment rate at a staggering 10.2%. Second, the economic uncertainty has triggered record-low interest rates, which in turn sparked a rush to refinance. If you are currently paying high interest rates on a long-term loan, you may want to consider refinancing and enjoying a lower monthly payment. Finally, investments in stocks, bonds and real estate may lose value during a recession. The good news is there’s no need to start stuffing money under your mattress. As a member of Ingersoll-Rand FCU, your funds are always safe. [Ingersoll-Rand FCU is federally insured up to $250,000 by the National Credit Union Administration] If you are experiencing financial difficulties of any kind, feel free to reach out to us at 570-888-7121 or to drop us a line at to see how we can help. Your Turn: What do you think will be most impacted by the coronavirus recession? Share your thoughts in the comments. Refresh your credit card knowledge
Understanding the way a credit card works can help the cardholder use it responsibly. A credit card is a revolving line of credit allowing the cardholder to make charges at any time, up to a specific limit. Each time the cardholder swipes their card, the credit card issuer is lending them the money so they can make the purchase. Unlike a loan, though, the credit card account has no fixed term. Instead, the cardholder will need to make payments toward the balance each month until the balance is paid off in full. At the end of each billing cycle, the cardholder can choose to make just the minimum required payment, pay off the balance in full or make a payment of any size that falls between these two amounts. Credit cards tend to have high interest rates relative to other kinds of loans. The most recent data shows the average industry rate on new credit cards is 13.15% APR (annual percentage rate) and the average credit union rate on new credit cards is 11.54% APR. Pay bills in full, on time The best way to keep a score high is to pay credit card bills in full each month — and on time. This has multiple benefits:
Brush up on billing There are several important terms to be familiar with for staying on top of credit card billing. A credit card billing cycle is the period of time between subsequent credit card billings. It can vary from 20 to 45 days, depending on the credit card issuer. Within that time frame, purchases, credits and any fees or finance charges will be added to and subtracted from the cardholder’s account. When the billing cycle ends, the cardholder will be billed for the remaining balance, which will be reflected in their credit card statement. The current dates and span of a credit card’s billing cycle should be clearly visible on the bill. Tip: It’s important to know when your billing cycle opens and closes each month to help you keep on top of your monthly payments. Credit card bills will also show a payment due date, which tends to be approximately 20 days after the end of a billing cycle. The time frame between when the billing cycle ends and its payment due date is known as the grace period. When the grace period is over and the payment due date passes, the payment is overdue and will be subject to penalties and interest charges. Tip: To ensure a payment is never overdue, it’s best to schedule a time for making your credit card payments each month, ideally during the grace period and before the payment due date. This way, you’ll avoid interest charges and penalties and keep your score high. Allow a minimum of one week for the payment to process. Spend smartly Credit cards can easily turn into spending traps if the cardholder is not careful. Following these dos and don’ts of credit card spending can help you stick to your budget even when paying with plastic. Do:
Don’t:
Using credit cards responsibly can help you build and maintain an excellent credit score, which will make it easier to secure affordable long-term loans in the future. Your Turn: How do you use your credit cards responsibly while keeping your score high? Share your best tips with us in the comments. Q: The last few months have been really tough on my finances, and I’ve been forced to use my savings for getting by. My emergency fund and savings account are basically zero. Now that my financial situation is starting to improve, I’d like to start building these up again, but it’s all so overwhelming. Where do I begin?
A: Watching savings that took you years to build up disappear in just a few months can be disheartening, but it’s important to remember that you’ve made the right choice. Using emergency funds to survive prolonged unemployment, an unexpected large expense or a medical emergency is the best way to make it through a financial hardship. If your savings are depleted, though, you’ll want to start rebuilding as soon as possible to ensure you have the funds to cover a future financial challenge without falling deeply into debt. Here’s how to start your rebuilding plan: Set a goal Before getting started on saving up money, it’s a good idea to establish a tangible goal. What’s your magic number? You can try to recover the value of the savings lost, or start smaller, with a more attainable goal. Bear in mind that experts recommend having funds to cover three to six months’ worth of living expenses set aside in an emergency fund or savings account. Review your budget and trim your spending A good place to start finding those extra dollars for savings is by carefully reviewing your spending for ways to cut back. Look for expenses that can make a difference in a monthly budget without dramatically affecting your quality of life. Think about subscriptions or services that are rarely used, a dining-out budget that can be scaled back and expensive recreational activities that can be swapped with freebies. There’s no need to live like you’re broke, but stripping your budget of some extras can give you the boost of cash you need each month to build up your savings again. Find a side hustle Another great way to land extra funds is through a side job. There are many ways to pad a wallet without a major investment of time. Some options include taking surveys on sites like Survey Junkie and Swagbucks and doing gig work for companies like Uber, DoorDash and Rover. Sell your old treasures If you’ve spent part of the COVID-19 lockdown giving your house a deep cleaning, you may have unearthed some forgotten treasures that can turn into easy moneymakers. You can sell old clothing on ThredUp, unwanted jewelry on Worthy.com, make good money off your unwanted furniture through Chairish, sell or trade unused sports equipment on Swap Me Sports and sell kids clothing and toys on Kid to Kid. Use the cash you earn from these sales to jump-start your new nest egg. Make a plan Once you have a goal in place for building your savings, and you’ve maximized the possible monthly contributions toward savings each month, it’s time to create a plan. Map out a timeline of how long it’ll take to reach your goal when putting away as much as possible each month. Remember: the more aggressively you save now, the sooner you’ll reach your goal. Start saving It’s time to put the plan into action! The best way to ensure regular savings happens each month is to make it automatic. You can set up an automatic monthly transfer from your Ingersoll-Rand FCU Checking Account to your Ingersoll-Rand FCU [Share/Savings] Account on a designated day of the month. You may want to have the transfer go through several days after you receive your monthly salary, or it might work out better to put a smaller amount of money into savings each week. Give us a call at 570-888-7121 to discuss your options. Put unexpected windfalls into savings To speed up the process of rebuilding depleted savings, you may want to resolve to put unexpected windfalls into an emergency fund or savings account. This can include tax refunds, a work bonus and gift money. If another round of Coronavirus stimulus checks is approved, consider using these funds for your savings as well. Earmarking future windfalls for savings can shorten the amount of time spent cutting corners in a budget and taking on extra jobs to build up a savings account. Rebuilding an emergency fund and savings account from the bottom up isn’t easy. It takes commitment, hard work and the ability to keep a long-term goal in mind; however, the security that comes from knowing you have a safety cushion to fall back on in case of a financial setback will make this goal worth the effort many times over. Your Turn: Have you started working on rebuilding your savings? Tell us about it in the comments. It feels like you just packed away the holiday decorations yesterday, but believe it or not, 2019 is already half over. As we sail into the season of barbecues and beaches, take a few minutes to give yourself a mid-year financial checkup.
A small investment of time can spur important changes that can affect your financial wellness for the rest of 2019 or even for years to come. Use the seven steps detailed below to guide you through your checkup. Step 1: Revisit Your Budget Remember sitting down in December and crunching all those numbers? There’s no need for such a detailed job again, but take some time to review your monthly budget. Are you sticking to the planned budget for every category? Are you overspending in some categories or under-spending in others? Do you need to adjust your allotted budget in some areas or maybe trim your discretionary spending across the board? Review your spending over the last few months and make any necessary changes so your budget can continue working for you. Be sure to account for any significant life changes that may alter your financial needs, such as a marriage, the birth of a child, a divorce or a job change. By reviewing and adjusting your budget, you will avoid falling into the mindless spending trap and you will be taking proactive steps toward staying on top of your finances for the rest of 2019. Step 2: Anticipate Large Expenses Now that you’ve updated your monthly budget, take a moment to list any large expenses you anticipate having in the next six months. This can include household appliances that may need replacing, expensive car repairs that will likely become necessary or an anticipated medical expense that is not fully covered by insurance. Once you have this information in hand, determine which spending category you will take the money from to cover these expenses. Do you have a rainy-day fund that can pay for one or several of these costs? Can you use the money in your emergency fund? Make the decision about sourcing this money now so you don’t make the wrong choices when you’re stressed and pressed for time in the future. If you do not have enough money set aside for these expenses, build a savings plan into your monthly budget now so you have the funds available when you need them. Step 3: Review Your Tax Withholdings Review your tax withholdings to see if they need any adjusting. If taxes and numbers are not your thing, ask your accountant for assistance with this step. Your goal here is to pay the perfect amount so you’re not hit with a huge tax bill at the end of the year but also not lending the government your money interest-free. Step 4: Check Your Credit Score Your credit score is like your money grade, indicating the degree of your financial wellness and responsibility. Visit AnnualCreditReport.com for your free credit report from any of the three major credit bureaus: Experian, TransUnion and Equifax. If your score has gone up in the last six months, you’re doing great! Keep up the good work. On the flip side, if your score has dropped, review your report in detail. Are there any errors you’ll need to contest with the Federal Trade Commission? Is there a credit card bill or another line of credit you’ve been neglecting that is dragging your score down? Are you having trouble remembering to pay your monthly bills in a timely manner? Take the necessary steps to fix your score today, whether that means contesting a charge, setting up an automatic payment on some of your bills or lowering your credit utilization rate by paying with plastic less often. Step 5: Review Your Investments Now is the time to review and adjust all of your investments. This includes your contributions to your retirement funds, any stock investments, bonds, trust funds or savings certificates at IRFCU. Make sure you are maximizing your contributions when possible and that your other investments are performing according to plan, making adjustments as necessary. Step 6: Tackle Your Debt List every single outstanding debt you carry, including credit card debt and loans. Designate one debt to tackle first, either choosing the one that carries the highest interest rate or the one with the lowest balance. Next, work on a plan to get rid of your chosen debt, being careful not to neglect the others. See if you can trim your budget or boost your income in any way to increase your payments on this debt. Once you’ve paid it off, move to the next one on your list so you’re on your way to a debt-free life. Step 7: Review Your Financial Resolutions and Long-term Goals Which financial resolutions did you jot down at the end of 2018? What are your dreams for the future? Did you want to start socking away another $200 a month? Is your goal to retire comfortably at 55? Take some time to review these goals and to determine whether you are indeed taking the steps necessary for making them happen. If you’ve been neglecting them for the first half of 2019, create a plan for working toward them for the rest of the year. Remember: With determination and proper planning, nearly any financial goal is possible! Now that you’ve given yourself a thorough financial checkup, you can kick back and enjoy the sweetness and the sunshine of the season, guilt-free. Happy summer! Your Turn: What’s on your list for your mid-year financial checkup? Tell us about it in the comments. We all grow up hearing the same financial advice: Spend less, save more and invest early. While most of these words of wisdom ring true, there are lots of widespread money management tips that are actually false. Read on for 7 money myths that might be causing you more financial stress than benefit. Myth #1: Debit is always better than credit. Do you automatically reach for your debit card when making a purchase? While it’s true that paying for your expenses with money you already have in your account is often the best choice, there is a time and a place for credit cards as well. The real deal: Credit cards get a bad rap for the debt trap they represent, but they should be your payment method of choice on occasion. First, many credit cards offer rewards in the form of travel miles, cash-back systems and other bonuses. Second, building and maintaining a strong credit history is crucial for your financial wellness; the only way to achieve this is by using your credit cards and paying your bills on time. Lots of credit cards offer purchase protection, which makes them the smarter payment method for big-ticket items. Finally, credit cards can be a safer method of payment when shopping online. Myth #2: Buy a home at all costs. It’s part of the American Dream: Go to college, land the perfect job, get married and buy a house, complete with white picket fence and two cars in the driveway. Unfortunately, though, too many people are fixed on that dream without realizing that owning a home might not be in their best financial interests. The real deal: For many people, including those who are not yet ready to put down roots or who anticipate a career change that necessitates moving across state lines, renting a home or apartment might be the better choice. It can also be a financially expedient option if you live in a super-expensive area. Myth #3: Investing is only for rich people. Investing is for people who drive luxury vehicles and have homes in three different states. Or is it? The real deal: Anyone with a small pile of money squirreled away can get a foothold in the stock market. A smart investment strategy can be the best way to let your money grow and put you on the track to financial independence. If you’re a beginning investor, look into passively managed index funds for an easy way to start building your wealth. Myth #4: My partner manages our finances, so I don’t need to think about money at all. Are you living in blissful financial oblivion, confident that your partner is managing your money? The real deal: Every adult should have a handle on their family’s finances, regardless of their partner’s involvement. While it is fine for one partner to actively manage their money, it is crucial for both partners to be aware of the state of the family finances and to be capable of managing the household expenses and investments if something happens to their partner. Myth #5: Credit cards will get me through any financial crisis. Why would I need an emergency fund? I have credit cards! The real deal: Depending on credit cards to get you through a financial emergency is the perfect way to dig yourself into a deep pit of debt. Thanks to interest, you’ll be paying back a lot more than you spend. You’re also more likely to overspend when you pay with plastic. Credit cards should not be relied upon for a real financial emergency, such as a job loss, divorce or illness. It’s best to build an emergency fund consisting of three to six months’ worth of living expenses so you’re completely covered for the unexpected. Myth #6: I’m so young; I don’t need to think about retirement. Who can think about retirement when it’s so far down the road because they’re just starting a career? Besides, who can afford to save for retirement when they’re bogged down with more pressing expenses, like saving for a house and putting kids through college? The real deal: There’s no better time to start planning and saving for your retirement than right now. The younger you start building your retirement fund, the less you’ll have to put away each month, and the more you’ll save by the time you’re ready to retire. Gift yourself with a comfortable, stress-free retirement by maxing out your 401K contributions, and/or opening an IRA or another retirement fund. Start today and let compound interest work its magic! Myth #7: I have enough in my account to cover my expenses so I don’t need to budget. Budgeting is for people who are barely squeaking through the month. I have enough money; so why budget? The real deal: Budgeting is for everyone. Without a realistic budget in place, someone pulling in a salary in the high six digits can easily spend their way into debt. A budget will force you to make responsible money choices and to be fully aware of the state of your finances at all times. Your Turn: Which money myths have you bought into in the past? Tell us all about it in the comments. |
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