5 Ways To Pay Off A Loan Early

If you’re like most Americans, you owe money toward a large loan. Whether that meanscouple working on computer carrying thousands of dollars in credit card debt, having a hefty mortgage in your name or making car loan payments each month, loan debt is part of your life. This means you’re looking at hundreds of dollars in interest payments over the life of the loan(s). There’s also the mental load of knowing you owe perhaps tens of thousands of dollars and that you’ll be paying back the loan for years to come.

It can all get kind of depressing-but it doesn’t have to be that way.

Did you know there are simple, but brilliant, tricks you can employ to lighten the load? With a carefully applied technique, you can pay off your mortgage, auto loan, credit card debt and any other debt you’re carrying quicker than you thought possible. These tricks won’t hurt your finances in any dramatic way, but they can make a big difference to the total interest you’ll pay over the life of the loan and help you become debt-free faster.

You can free up more of your money each month, use your hard-earned cash for the things you want instead of forking it over in interest and live completely debt-free sooner than you’d dreamed. It’s all possible!

A note of caution before we explore these tricks: Check with your lender before employing any approach, as some loan types have penalties for making extra or early payments (we don’t at Destinations Credit Union!).

1. Make bi-weekly payments

Instead of making monthly payments toward your loan, submit half-payments every two weeks.

The benefits to this approach are two-fold:

  • Your payments will be applied more often, so less interest can accrue.
  • You’ll make 26 half-payments each year, which translates into an extra full payment on the year, thereby shortening the life of the loan by several months or even years. If you choose this method with a 30-year mortgage, you can shorten it to 26 years!

2. Round up your monthly payments

Round up your monthly payments to the nearest $50 for an effortless way to shorten your loan. For example, if your auto loan costs you $220 each month, bring that number up to $250. The difference is too small to make a tangible dent in your budget, but large enough to knock a few months off the life of your loan and save you a significant amount in interest.

For a potentially even bigger impact, consider bumping up your payments to the nearest $100.

3. Make one extra payment each year

If the thought of bi-weekly payments seems daunting but you like the idea of making an additional payment each year, you can accomplish the same goal by committing to just one extra payment a year. This way, you’ll only feel the squeeze once a year and you’ll still shorten the life of your loan by several months, or even years. Use a work bonus, tax refund, or another windfall to make that once-a-year payment.

Another easy way to make that extra payment is to spread it out throughout the year. Divide your monthly payment by 12 and then add that cost to your monthly payments all year long. You’ll be making a full extra payment over the course of the year while hardly feeling the pinch.

4. Refinance

One of the best ways to pay off your loan early is to refinance. If interest rates have dropped since you took out your loan or your credit has improved dramatically, this can be a smart choice for you. Contact Destinations Credit Union to ask about refinancing.

It’s important to note that refinancing makes the most sense if it can help you pay down the loan sooner. You can accomplish this by shortening the life of the loan, an option you may be able to afford easily with your lower interest rate. Another means to the same goal is keeping the life of your loan unchanged and with your lower monthly payments, employing one of the methods mentioned above to shorten the overall life of your loan.

5. Boost your income and put all extra money toward the loan

A great way to cut the life of your loan is to work on earning more money with the intention of making extra payments on your loan. Consider selling stuff on Amazon or eBay, cutting your impulse purchases and putting saved money toward your loan, or taking on a side hustle on weekends or holidays for extra cash. Even a job that nets you an extra $200 a month can make a big difference in your loan.

Triumph over your loans by using one or more of these tricks to make them shorter and pay less interest. You deserve to keep more of your money!

Your Turn: Have you used any of these methods or a different approach for paying off a loan early? Tell us about it in the comments.

SOURCES:
https://www.thebalance.com/how-to-pay-off-debt-early-315571

https://www.google.com/amp/s/www.huffpost.com/entry/top-6-ways-to-pay-off-any-loan-faster_b_1624242/amp
https://www.payoff.com/life/money/6-ways-to-pay-off-your-car-loan-early/

Tax Code Changes 2019

The tax code gets a bit of an overhaul each year, and with the changes, it can getblocks with 2019 on them topping a tax form confusing. No worries, though; we’ll walk you through everything you need to know for 2019.

Most amendments to the tax code will only begin to affect taxpayers in April 2019. However, some of the changes can impact the financial choices you make this year. Learning about these changes early in the year will help you to make the best decisions possible.

Read on to learn about the most important changes to the tax code for 2019.

1.)   Changes to the amounts taxed for each income bracket

The 7 tax income brackets are unchanged at 10%, 12%, 22%, 24%, 32%, 35% and 37%. However, the amount each bracket is taxed has changed.

Here are the new rates for taxpayers filing as individuals.

Taxable Income Bracket                  Tax Due

10%     $0-$9,700                               10% of taxable income

12%     $9,701 -$39,475                     $970 +12% of income over $9,700

22%     $39,476 – $84,200                  $4,543+22% of income over $39,475

24%     $84,201 – $160,725                $14,382.50+24% of income over $84,200

32%     $160,726- $204,100               $32,748.50+32% of income over $160,725

35%     $204,101- $510,300               $46,628.50+35% of income over $204,100

37%     $510,301 and up                     $153,798.50+37% of income over $510,300

Taxable income rates vary for couples filing jointly and for individuals filing as heads of households. You can check out the changes to each bracket here.

2.)   Changes in standard deduction amounts

The standard deduction amounts will see slight increases over the deductions of 2018. The standard deduction in 2019 will be $12,200 for individuals, $18,350 for heads of household or $24,400 for married couples filing jointly and surviving spouses.

3.)   Elimination of personal exemptions

The personal exemption amount was set to 0 for 2019 under the Tax Cuts and Jobs Act, and is therefore no longer in effect.

4.)   Changes to itemized deductions on Schedule A

There have been several changes to itemized deductions for 2019 taxes. These include:

  • Medical and dental expenses. There is a new floor of 10% for medical and dental expenses. This means you can only deduct medical and dental expenses that exceed 10% of your adjusted gross income (AGI.)
  • State and local taxes (SALT). The new maximum for SALT deductions is a combined total of $10,000 for taxpayers filing jointly, and $5,000 for married taxpayers filing separately.
  • Home mortgage interest. In 2019, interest paid for acquisition purposes, like buying, building or improving your home, will be maxed at $750,000 for married couples filing jointly, and $375,000 for married couples filing separately.
  • Casualty and theft losses. The deduction for personal casualty and theft losses has been eliminated with the exception of losses incurred in a federal disaster area.
  • Job expenses and miscellaneous. All miscellaneous work-related expenses will be subject to a 2% floor, which means you can only claim deductions that are less than 2% of your AGI.

5.)   Changes to tax credits

There have been several welcome adjustments to various tax credits for 2019, including the following:

  • Child Tax Credit. The child tax credit has increased to $2,000 per child and is refundable up to $1,400. There is also a $500 nonrefundable credit for other qualifying dependents.
  • Earned Income Tax Credit (EITC). The maximum EITC amount for 2019 is $6,557 for married taxpayers filing jointly who have three or more children.
  • Adoption Credit. The maximum adoption credit in 2019 for a child with special needs is $14,080. The ceiling for other adoptions is $13,810.
  • Lifetime Learning Credit. For 2019, the AGI used by joint filers to determine the reduction in the Lifetime Learning Credit is increasing by $2,000 to $116,000.

6.)   Increases for contributions to retirement accounts

Retirement accounts do more than help you plan for a financially sound future; some of them can also significantly lower your taxable income.

Traditional IRAs and 401(k)s allow you to contribute pre-tax income, which decreases your taxable income. The new ceilings for contributions to these accounts can lower that number even more.

For 2019, you can contribute a total of $6,000 to one or more traditional or Roth IRA(s) if you’re under age 50, and $7,000 if you’re older than 50. For 401(k)s, the new maximum contribution amount is $19,000, and $25,000 for those aged 50+.

7.)   Health Savings Account contributions

Health Savings Accounts (HSA) are similar to traditional retirement accounts; they’re funded with pre-tax money and can lower your tax bill. You use the money in your HSA to pay for qualified medical expenses. When you turn 64, you can withdraw the money in your HSA and use it for any purpose. However, these withdrawals are subject to income tax.

In 2019, the maximum contributions for HSAs will increase to $3,500 for individuals and $7,000 for families. Taxpayers aged 55+ can contribute an additional $1,000.

The U.S. tax code can get confusing at times, but ultimately the amendments and adjustments to the code are to our benefit. Learning about the changes to the code will help you to take full advantage of any relevant credits and deductions.

Your Turn: Which tax credit or deduction helps your finances most? Tell us all about it in the comments.

SOURCES:
https://www.google.com/amp/s/www.forbes.com/sites/kellyphillipserb/2018/11/15/irs-announces-2019-tax-rates-standard-deduction-amounts-and-more/amp/

https://www.google.com/amp/s/www.marketwatch.com/amp/story/guid/18A0A5AE-E9DD-11E8-8F27-5C6847258365
https://www.google.com/amp/s/www.fool.com/amp/retirement/2018/12/23/the-6-best-tax-deductions-for-2019.aspx
https://www.google.com/amp/s/amp.usatoday.com/amp/2207406002

Should I Sign Up For Budget Billing?

Q: My steep utility bills in the winter and summer months always throw my budget for awoman looking at bill loop. Should I sign up for budget billing?

A: Budget billing can simplify your utility payments by making each month the same fixed amount, but it’s important to understand all the facets before signing up.

Read on for all your questions on budget billing, answered.

What is budget billing?

When you sign up for budget billing, the utility company will add up the total amount you paid for their service over the last year, include a small percentage for inflation and then divide that number by 12. This value becomes the amount due for your monthly bill. This way, you pay the same amount of money for your gas or electric bill whether you’ve had freezing weather that month or you’ve had the central air running full blast for days.

What happens if I use more or less energy than the company estimated?

If your energy usage exceeds the company’s estimate, you’ll need to pay the difference at the end of the year.

If you’re careful about conserving energy and use less this year than was estimated, most companies will give you a credit toward next year’s bills. Some will offer you a lower monthly budget based on your most recent usage for next year, and others will actually issue you a refund at the end of the 12 months (think, no amount due for the next 1-2 months!).

Do I have to pay for this service?

Fees for budget billing vary by company, so be sure to read the contract carefully before you sign up for this service. Some companies offer this service free of charge. Many will collect a small fee for budget billing, which shouldn’t be enough to deter you from signing up. However, if a company is asking for $3 or more a month just to work out a budget for you, it’s probably not worth the price.

What are some pros of budget billing?

The most obvious benefit of budget billing is a fixed monthly utility bill. Without that, you’re facing super-high bills during months of extreme weather. And that can make it difficult to stick to your monthly budget. The more fixed expenses you have each month, the easier it is to work out a budget and actually keep it.

Budget billing also helps offset the high costs of summer and winter bills. Lots of people, such as those who live in places that see extreme weather, can find it difficult to pay the doubled or tripled bills these times of year. Averaging the energy costs of the entire year and spreading it over 12 months makes it a lot more manageable.

What are some cons of budget billing?

Many people who sign up for budget billing end up using a lot more energy than they did when they paid for each month’s actual energy usage. When you know your bill will be the same no matter how high you crank that thermostat, it’s harder to be disciplined enough to keep it down. Of course, this means a higher bill at the end of the year.

Also, while budget billing may make it easier to pay your monthly bills, it can be hard to cover the balloon payment at the end of the year.

Is there a way to create a budget-billing plan myself?

If you don’t want the hassle, fees or restrictions of a budgeting plan, you can easily do it on your own.

It’s best to start your own budget during off-peak seasons, like autumn or spring, when bills are typically lower. To find your magic monthly number, simply total up your utility bills of the last year, add .03% for inflation and divide the amount by 12. Work this fixed amount into your monthly budget. During the cheaper months, you’ll need to set aside the extra money to cover your higher bills during the more expensive times of year.

If your numbers are right and you’re mindful about your energy usage, your budget can work perfectly and serve you well throughout the year. If you’re super-careful, you may even end up with some extra cash at year’s end.

How can I save on my energy bills?

Whether you choose to sign up for budget billing, work out your own plan or deal with fluctuating bills each month, it’s always a good idea to cut down on your energy usage.

Here are some tips to get you started:

  • Only use LED bulbs. You’ll need to spend more on each bulb when you make the change, but the payoff is 75% less energy usage than a traditional bulb and a lifespan that is 25 times longer than their counterparts.
  • Get rid of air leaks. Don’t let the cold air into your home! Seal all drafty areas and hang curtains on your windows for an extra layer of warmth.
  • Adjust your thermostat. Changing your “comfortable” thermostat number by just a couple degrees can save you 1-3% off your heating and cooling bills each month. Dress warmly in the winter instead of turning the thermostat higher. During the summer, use your outdoor grill on blazing hot days to keep the house a little cooler without turning down the A/C.
  • Keep your units well-maintained. If your HVAC system is not functioning optimally, you can be paying more money just to keep it going. Replace your filters as necessary, keep your units clean and consider calling in an expert at the start of each season to determine if everything is in proper working order.

Don’t let soaring utility bills get you down this winter! Consider signing up for budget billing or creating a billing budget on your own and do all you can to lower those bills.

Your Turn: Are you signed up for budget billing with your utilities? How is it working out for you? Tell us all about it in the comments, below.

SOURCES:
https://clark.com/personal-finance-credit/should-you-use-budget-billing-for-your-utilities/

https://www.google.com/amp/s/m.huffpost.com/us/entry/9578004/amp
https://www.thebalance.com/what-is-budget-billing-2385943

7 Ways To De-Stress For Less

Winter doldrums got you down? The empty calendar making you feel blue? Don’t pull family playing in snowout your wallet for some “retail therapy” just yet!

Right now is the time of year when the blues hit the hardest, so many people turn to their favorite foods, a round of shopping or some other costly means of escape. However, you can get the same results without spending a penny. Let [credit union] show you how to de-stress for less and send that down mood packing!

Read on for 7 pick-me-ups that are absolutely free.

1.)  Get moving

If the end of the holidays has you feeling down, haul yourself off the couch and start doing crunches. Hit the treadmill and torch those calories or bundle up and go for a jog outdoors. When you get moving, so do those feel-good endorphins-and the blues won’t stand a chance!

2.)   Listen to some music

Music has always been strongly linked to our emotional state. Slow, classical music played at a low decibel level has a unique calming effect on our minds and our bodies. If that’s not your thing, evoke the power of memory by listening to music that brings you back to a happier time and place, whether that means the pulsing beats you blasted in high school or the sappy tunes you played in the blissful days during your honeymoon.

3.)   Spend time with nature

Don’t spend all winter hunkering under a blanket and waiting for spring. Zip up your parka, grab a warm hat and embrace the cold! There’s nothing like some fresh air to put the zing back in your step.

But it goes deeper than that: Research shows that spending time surrounded by nature can improve your physical well-being, reduce blood pressure and muscle tension, and best of all, it can even cut down on the production of stress hormones! Irina Wen, Ph.D. and clinical psychologist at the Steven A. Military Family Clinic at NYU Langone Medical Center, says spending time with nature can also be helpful with combating depression and anxiety.

If you live near a wooded area, you can take nature’s healing power up a notch. “Forest bathing” is the new stress-buster! All it involves is spending time alone in a forested area. A 2010 study found that participants who forest bathed had lower blood pressure and levels of cortisol, aka “the stress hormone,” than those who walked through city blocks. Take a hike in the woods and drop that stress for good!

4.)   Laugh a little

Yes, a good laugh really is the bet medicine. If you’re feeling down, get yourself some of those giggles! Next weekend, invite a friend over and binge-watch your favorite comedy show or sitcom. As you laugh along with the characters on the screen, your tension will slowly melt away.

5.)   Learn a new skill

Boost your confidence and get an instant pick-me-up by learning something new this winter. You can find a DIY tutorial on YouTube for practically any hobby or skill you can dream up, plus loads of those you’ve never thought of before. Become an origami expert, learn a new language, crochet the warmest blanket, or even take up pottery! Have yourself a great time and impress your friends and family with what you (soon) can do. If YouTube doesn’t have what you need, you can also check out Instructables.com, HowCast or VideoJug.

6.)   Pet your pooch

Scientific evidence proves that stress levels in humans decrease when they pet a furry friend. Give your pet a little extra love when you’re stressed and you may just feel the stress slowly fade right out of you. If you don’t own a pet, visit an animal rescue center and spend time with the animals there. You might even come home with a new four-legged friend!

7.)   Soak up some sun

Seasonal Affective Disorder (SAD) is a very real condition that makes people feel blue during the winter months when the days are short and sunlight is scarce. Since sun exposure releases a compound into the blood vessels that reduces stress, insufficient sunlight has a direct effect on our moods.

Kick the SAD this winter by soaking in as much sunshine as you can. Open the shades to let the sunlight in while you work and try to squeeze in an early-morning walk each day so you’re spending time outdoors while the sun is still up. If the skies are cloudy and you’re craving some sunshine, you can try sitting under special UV lamps for the same effect.

Don’t let the winter blues bust your budget. Instead of spending money on expensive and unhealthy escapes, beat the blues with our helpful hacks!

Your Turn: How do you get rid of stress without spending a lot of money? Share your tips and tricks with us in the comments!

SOURCES:
https://www.mind.org.uk/information-support/your-stories/spending-money-for-comfort/
https://www.healthline.com/nutrition/16-ways-relieve-stress-anxiety

https://www.helpguide.org/articles/mental-health/laughter-is-the-best-medicine.htm
https://psychcentral.com/lib/the-power-of-music-to-reduce-stress/
https://www.nbcnews.com/better/pop-culture/how-nature-can-solve-life-s-most-challenging-problems-ncna749361
https://www.google.com/amp/s/www.gobankingrates.com/saving-money/shopping/free-ways-relieve-stress/amp/
https://www.wisebread.com/20-free-or-really-cheap-ways-to-relieve-stress

All You Need To Know About Facebook’s Latest Bug

With its wide range of features, easy-to-use interface and streamlined access, Facebook iswoman in coffee shop checking cell screen the darling of the social media age. It helps people stay connected with family and friends, allows new relationships to blossom and creates a culture of community for new and established businesses alike.

However, last month, Facebook announced its internal team found a photo API bug in its platform which may have exposed the unshared photos of 6.8 million users. As the latest in a stream of publicized security issues, this breach has the public confused and worried about their privacy.

Read on for all you need to know about the recent Facebook bug.

What happened because of the photo bug?

According to Facebook’s policy, apps linked to Facebook are only allowed to access photos that users give them permission to view, such as those posted on their Facebook timeline. The recent bug, however, may have allowed third-party apps to access loads of other pictures without their user’s knowledge and permission.

An estimated 1,500 apps built by 876 developers were affected by the bug. All of these apps are approved by Facebook, and were authorized by users to access their photos.

The photos breached include those shared on Facebook Stories or Marketplace as well as photos that had been uploaded but weren’t yet posted on Facebook.

The bug was active from Sept. 13 to Sept. 25. Although, Facebook waited to come clean about the breach in mid-December.

What steps has Facebook taken to fix the bug?

Facebook fixed the bug as early as Sept. 25 and has openly apologized for the breach. They have promised to let app developers know which of their users have been affected by the bug so they can take steps on their own. Facebook has also claimed to be working on strengthening their platform’s privacy to prevent future photo leaks and security breaches.

When asked why the social media giant did not inform the public about the bug immediately, a Facebook representative told CNN Business, “We have been investigating the issue since it was discovered to try and understand its impact so that we could ensure we are contacting the right developers and people affected by the bug. It then took us some time to build a meaningful way to notify people, and get translations done.”

Despite the statement, the jury remains out on whether Facebook has really taken the responsible course of action after the bug was discovered.

What does the bug mean for impacted Facebook users?

Having your unshared photos posted on public forums can lead to a host of safety issues. Thankfully, no crimes have been linked to the photo leak to date, but crooks can use revealing photos to stage a home robbery or worse. For reasons such as this, it’s always best to use the strongest privacy settings on your social media platforms and to be super-careful about which apps you allow to access your photos.

To be extra careful and keep yourself safe in the event of security breaches like Facebook’s recent photo bug, never post pictures that are too revealing about your personal life and your financial situation.

How can I check if my photos were leaked?

Facebook has issued an official alert to all affected users with clear steps for protecting their photos. The alert directs users to a Help Center Page where they can check if they’ve used any apps affected by the bug and get instructions on how to proceed from there.

Facebook also advises users to log into any apps they use to share photos and check which ones are accessible. If you’re worried about an app’s privacy, log into Facebook’s Manage Your Apps page and contact the app developer directly to inquire about the accessibility of your photos.

Facebook’s latest security breach may have impacted millions of users, but with the proper reactive steps and an eye toward a more secure future, it can help the social media giant and all its users practice stronger security measures and protect their privacy against potential breaches.

Your Turn: Have you been impacted by Facebook’s latest breach? Share your experience with us in the comments below.

SOURCES:
https://betanews.com/2018/12/16/facebook-photo-api-bug/

https://www.google.com/amp/s/amp.cnn.com/cnn/2018/12/14/tech/facebook-private-photos-exposed-bug/index.html
https://www.geek.com/tech/facebook-photo-bug-how-to-check-if-you-were-impacted-1766300/
https://www.google.com/amp/s/www.cnbc.com/amp/2018/12/14/facebook-bug-exposed-photos-from-up-to-6point8-million-users.html

 

7 Reasons Not To Skip A Home Inspection

Shopping for a new home can be an exciting blur of listings, neighborhood scouting andinspection open houses. There’s so much to consider! You want a house in the perfect neighborhood with that gorgeous kitchen and great yard, all within your budget.

And then, it all finally comes together and you think you’ve found your dream home. But don’t go “under contract” just yet! First, be sure to have an inspection contingency included in your contract. Doing so can save you a ton of aggravation and thousands of dollars in the long run.

Once you’re under contract, you’ll need to have your future home professionally inspected by a certified engineer or a licensed inspector. The inspector will carefully examine the entire house from top to bottom, checking its systems, structure and equipment for functionality and potential problems.

A home inspection will set you back several hundred dollars, but it can easily save you thousands down the line. Before you officially become the new owner of the house, learn all you can about its general condition.

Here are 7 reasons you don’t want to skip a home inspection:

1.)   Find deal-breakers

A house can look fantastic, but have major structural or technical issues with its wiring, roof, HVAC system, plumbing and more. A quality home inspection will give you the inside scoop on a house before it becomes your home. If the inspection reveals any large problems that would require heavy maintenance or expensive repairs, you may want to back out of the deal. Having an inspection contingency in your contract gives you a way to opt out even after you are officially under contract.

If the inspection reveals major problems, but you like the home too much to back away, you can ask the seller to fix the problems before the closing date. Sellers will usually agree to cover any major repairs or to offer the buyer a credit toward overseeing the repairs themselves.

2.)   Safety concerns

An inspection can reveal the presence of harmful substances like radon, carbon monoxide and mold. Look for these hazards before the home is officially yours. You don’t want any unpleasant surprises after it’s too late.

3.)   Anticipate future costly repairs

A home’s systems and equipment may appear to be working perfectly when they’re actually on their last legs. A professional inspector will be able to determine the age and condition of the home’s systems and equipment, and then forecast when they may need to be repaired or replaced. This might not be a big enough deal for you to back out of the contract, but it will help you budget for a major repair several years down the line. Alternatively, you may be able to use it for price negotiation.

4.)   Reveal illegal additions

The awesome rec room you love in the basement of your potential new home might have been illegally built. An inspection will check for rooms, garages and basements that were added or finished without following legal codes or obtaining the proper permits. Having an illegal addition in your home means owning property that does not officially exist. This can get you into trouble with home insurance and property taxes, and can make it difficult to do more work on these areas in your home.

If a home inspection reveals any illegal additions, you can ask the seller to obtain the proper permits now, use this information as a bargaining chip or choose to back out of the deal.

5.)   Obtain insurance easily

Lots of home insurance companies will not insure a home if it has not undergone a certified inspection. Insurance companies don’t want to take a chance covering a home that’s going to need costly repairs in the near future.

6.)   Learn how to protect your investment

If possible, arrange to follow the inspector around the home as they complete the job. They will be an invaluable source of information for you, providing tips and knowledge on how best to maintain your home, its systems and equipment. Knowing how to properly care for your home can save you thousands of dollars over the years.

7.)   Negotiate

Most home inspections will reveal several problems. If these problems are minor enough to keep you interested in buying the house in its present condition, you can use them as bargaining chips to renegotiate the purchasing price of the home.

No matter how perfect your dream home looks, it’s never a good idea to skip a home inspection.

Are you in the market for a new home? Call, click or stop by Destinations Credit Union today to ask about the fantastic home loan options we have for you!

Your Turn: Has a home inspection saved you from a possible horror story? Share it with us in the comments.

SOURCES:
https://www.ahit.com/news/why-home-inspections-are-important.htm

https://www.investopedia.com/financial-edge/0511/10-reasons-you-shouldnt-skip-a-home-inspection.aspx
https://www.veteransunited.com/futurehomeowners/5-key-reasons-to-have-a-home-inspection-before-you-buy/
http://www.homeinspectionexpertsraleighnc.com/5-reasons-to-get-a-home-inspection-on-a-new-home/

The Ultimate Guide To Your First Apartment

If you’re in the market for your first apartment, you may be feeling a little lost-and moreMother and daughter hugging during a move-in than a little overwhelmed. How do you get started? What should you be looking for in an apartment? How do you check out a building?

So many questions, and we’ve got answers! Let Destinations Credit Union walk you through the apartment-hunting process from start to finish, and you’ll have the key to your new apartment faster than you thought possible.

Getting started

Before you look at any apartments, make a short checklist of what you’re looking for in a rental. Create a list of features in order from most important, such as location or the minimum square footage, to least important, like a fireplace or extra washroom.

Next, crunch some numbers. Take a look at your monthly budget and determine the maximum amount you can afford to spend on monthly rent. This amount should also include all associated fees and utilities.

With your wish list and budget in hand, you’re ready to start looking for places to live. Check out rental listings on sites like Zillow or Rent.com, look up units in the local paper and/or ask friends and family if they know of any apartment vacancies in the neighborhood.

Once you’ve compiled a list of possible apartments, contact each landlord or property manager and start hunting!

What to look for

Don’t get blindsided by an apartment’s funky paint colors or fantastic price. Take this handy guide along on your apartment hunts so you can make an informed decision.

1.)   Price

The landlord or manager will quote you a rental price, but make sure to find out exactly what’s included in that number. Will you be billed separately for utilities? Do you need to pay for a parking spot?

You’ll also want to check for any additional fees possibly attached to this rental. Ask about the following:

  • Application fee
  • Background check fee
  • Credit check fee
  • Association fee
  • Amenity fee
  • Pet fee
  • Security deposit fee
  • Early termination fee
  • Acceleration clause fee

You can also use this opportunity to try negotiating for a lower price.  Make sure your credit rating is decent or you may get turned down or be charged a higher price when renting.  If you need help improving your credit score, Destinations Credit Union has some great free resources.

2.)   Maintenance

Ask detailed questions about maintenance. Who is responsible for general repairs and maintenance issues? What is the procedure for submitting a maintenance request? How long does it generally take for an issue to be addressed and resolved?

Don’t just absorb the information shared here; pay close attention to the way the landlord answers. If there’s an uncomfortable amount of hesitation, take it as an indication that the handling of the building’s maintenance is somewhat shoddy.

3.)   Decoration policy

Is there a strict decoration policy in place? Will you need permission before hanging up a picture or painting the walls?

4.)   Apartment location

The rental unit might be in your desired neighborhood, but its exact location will strongly affect your quality of life. Is it apartment near a popular café or bar? Is it close to a busy intersection or highway? Is there public transportation nearby?

You’ll also want to check out where the apartment is located inside the building. Is it near a highly populated area like the elevator bank? Is it close to an unpleasant place like the garbage chute?

5.)   Common areas

As you walk through the building to the apartment, take a good look at your surroundings. Are the common areas in the building kept up well? Is the building clean and in good condition?

6.)   Noise level

If you’re an incurable night owl who doesn’t get up until after 9 each morning, you don’t want to land in the apartment under the early-rising tuba player. You won’t know much about your neighbors until you move in, but you can listen to the noise that filters in from the surrounding apartments to get an idea.

7.)   General condition of apartment

As you walk through the apartment, flush the toilets, run the sinks and showers, check out the electric sockets and try out the windows. Make sure everything is in perfect working order beore you sign the lease.

8.)   Cellphone reception

Make a phone call when you’re checking out the apartment to see if you’ve got good reception. You don’t want to be forced to hang out in the lobby or outside on the sidewalk every time you need to make a call.

Sealing the deal

You’ve found an apartment that fits your criteria and you’re ready to sign the lease. Before you do that, though, make sure to follow these final steps.

First, get the contact info of another renter in the building. You can ask your reference to clear up anything you’re unsure about regarding the building or neighborhood. As a bonus, you’ll be forging your first relationship with your new neighbors.

Next, be sure to read through the lease very carefully. Check for hidden fees, lease renewal and termination policies as well as rent collection procedures.

Finally, if everything checks out, you’re ready to sign the lease. Best of luck in your new home!

Your Turn: Have you recently signed a lease on a new rental unit? Share your tips on the process with us in the comments.

SOURCES:
https://www.google.com/amp/s/lifehacker.com/5877079/bring-this-checklist-with-you-next-time-youre-apartment-hunting/amp

https://www.rent.com/blog/ultimate-apartment-hunting-checklist/
https://www.apartmenttherapy.com/the-ultimate-what-to-look-out-for-checklist-for-your-next-apartment-hunt-218699
https://www.apartmenttherapy.com/10-things-to-look-for-on-your-next-apartment-hunt-that-you-havent-thought-of-yet-214859

Do I Need An Emergency Fund And A Rainy Day Fund?

Q: Do I need to have a separate rainy day fund and emergency fund?jar with money labeled emergency fund

A: In an effort to simplify their money, people sometimes consolidate accounts. This is OK in many instances, but it’s important to remember that rainy day funds and emergency funds serve different purposes. Additionally, it’s important to have not just one, but both funds available to tap into as needed.

Read on for all your questions on rainy day and emergency funds, answered.

Why have a rainy day fund?

Say your washing machine decides to suddenly quit on you and needs replacing. You’re now looking at an extra expense that can run anywhere from $350-$850 (or more). Where are you going to get that kind of money in a pinch?

According to a Federal Reserve Board report, if you’re like 44% of Americans, you’ll need to sell something you own or borrow money to fund such an unexpected expense. Or, you might choose to charge the purchase of a new washing machine to a credit card, which means you’ll pay extra in interest and the cost of the new machine will be haunting you for months-or even years-to come. Either way, a surprise expense of a few hundred dollars can be enough to send you into a tailspin of debt.

Is there a solution?

Here’s where your rainy day fund comes in. It’s a small savings account created just for these types of small, unfixed expenses that you know will crop up on occasion. You’ll tap into your rainy day fund to pay for minor household and car repairs, to cover the cost of summer camp for your child, or to replace your broken kitchen table. When you have a way to fund these small financial hiccups, they won’t have as much of a chance to disrupt your financial health.

Why have an emergency fund?

In contrast to your rainy day fund, an emergency fund is for much larger expenses. It should have enough padding to keep you afloat even if you experience a major disruption in your life, like a divorce, job loss or illness. Without an emergency fund, any of these, or a similar event, can leave you scrambling to pay your bills and quickly send you into a debt trap that can last years.

How much money should be in each fund?

Your rainy day fund, created for minor expenses, only needs to hold $500-$1,000. That should be enough to tide you over in the event of a small, unfixed expense.

Sometimes, you may be able to anticipate these expenses and save up for them accordingly. For example, if you know your child will need braces next year or that your HVAC system will need replacing in a year or two, you can build up your rainy day fund over the next several months until it has enough to fund these anticipated expenses.

Your emergency fund, however, should be positioned to pull you through major financial crises. That’s why you will need to have a lot more money in the account. Ideally, it should hold 3-6 months’ worth of your living expenses. This value will vary according to circumstance and can be anywhere from $3,000-$10,000 or more. Find your own magic number by tracking all your fixed and discretionary expenses for a month and multiplying that amount by 3 or 6.

Where should I keep these funds?

By definition, the cash in both of these funds needs to be easily accessible. Don’t lock the money up in a Savings Certificate or another long-term savings account that will make it difficult and/or expensive to withdraw when the need arises.

Your Destinations Credit Union Savings Account is a perfect home for both your rainy day fund and your emergency fund. You can even set up multiple accounts for each one. Your money is always safe here, and our rates are generally some of the best in the market. Best of all, you’re free to withdraw your funds without penalty whenever you need to do so.

How can I build my funds?

You’re convinced: You need an emergency fund and a rainy day fund. But how are you going to get the money for both? If you’ve never saved up for unexpected expenses before, the prospect of doing so can be daunting.

No worries, though. With a bit of discipline and hard work it can be done! Use these three tips to build your funds:

  1. Start a side hustle. Freelance for hire, take online surveys for spare cash or accept a seasonal position. Keep all or most of the extra money you pull in for your funds, making equal contributions to each fund.
  2. Trim your budget. Take a long hard look at where your money goes each month and choose your biggest money-gobbler to be pruned. Use the money you save for your funds.
  3. Make it automatic. Set up an automatic transfer from your Checking Account to your Savings Accounts so your funds grow on autopilot and are less tempting to use for fun.

It may be some time before your funds are fully padded, but that’s OK. It takes time to save up that kind of money, and hopefully you won’t need to tap into your savings until you’ve successfully built your funds.

Also, you won’t need to stick to your tightened budget or keep your extra job forever; you can drop both as soon as your funds are built, taking them up again only when the money in one of the funds is depleted.

Start setting up your rainy day and emergency funds today! You’ll sleep better at night knowing you’re prepared for any financial eventuality.

Your Turn: Do you have a rainy day fund and an emergency fund, or do you use the same source to fund any extra expense? Share your take with us in the comments below.

SOURCES:
https://www.thebalance.com/do-you-need-a-rainy-day-fund-and-an-emergency-fund-4178821

https://www.aarp.org/money/credit-loans-debt/info-08-2011/rainyday-fund-emergency-fund.html
https://www.nerdwallet.com/blog/banking/why-you-should-save-a-rainy-day-fund-and-an-emergency-fund/

What You Need To Know About Inheriting An IRA

No one likes to think about what happens when a family member passes on, but it’s best grandparents with young childto plan for the financial repercussions of a death in the family long before the time comes.

Most people assume an inherited IRA account will work just like any other asset they may inherit from a loved one. However, there are many rules and regulations at play when it comes to inheriting an IRA. The wrong choice can cost the beneficiary a whole lot of money in taxes and penalties. That’s why it’s important to take the time to research your options now. Then, when the time arrives, you will have a plan in place, allowing you to fully focus your attention on the right matters without worrying about financially messing up.

Read on for all you need to know about inheriting an IRA.

Inheriting from a spouse

The surviving spouse has two options when inheriting a traditional IRA:

  1. Spousal rollover:

    The surviving spouse can either change the IRA’s title to have their own name listed as owner, or transfer all the funds to their own existing IRA. If possible, the transfer of funds should be done within 60 days of the departed spouse’s death to avoid heavy taxes on the distribution. Once transferred, the money can continue to grow, tax-deferred.

    This is the most popular option for surviving spouses. However, it is not always the best choice. Surviving spouses cannot access transferred IRA funds without paying the 10% early-withdrawal penalty-in addition to income taxes-until they reach the age of 59 ½. Also, if the surviving spouse is older than 70½, they must take an annual minimum distribution.

  2. Open an inherited IRA

    With this option, the new owner will remain the beneficiary of the original IRA and open a new inherited IRA account in their own name. This allows the surviving spouse to avoid the 10% early-withdrawal penalty even if they are younger than 59½ years old.

    The owner of the inherited IRA must then begin taking distributions from the account before Dec. 31 of the year of their spouse’s death.

There are 3 ways to take distributions from an inherited IRA:

  • Distributed evenly over the rest of the beneficiary’s lifetime. Each withdrawal amount will be based upon the beneficiary’s life expectancy. The surviving spouse also has the option to calculate their life expectancy based on the original owner of the IRA instead of their own. This can be a convenient choice for spouses who were much older than their departed partners, as it allows the surviving spouse to withdraw less money each year and let the remaining amount collect additional interest until they need to access it.
  • Over the course of five years. Emptying the entire IRA in the five years following the original owner’s death will force the beneficiary to pay heavy income taxes on the withdrawals.
  • In one lump sum. The income taxes on a single, full withdrawal of funds can be steep enough to offset any gains.

Non-spousal inheritance

Inheriting an IRA from someone other than a spouse comes with its own set of rules. Primarily, beneficiaries of these IRAs cannot choose to transfer the funds in the inherited IRA into their own accounts. Instead, they will need to begin taking distributions after the IRA’s owner has passed on. They can choose to take distributions over their lifetime, within five years after the deceased’s passing or in one lump sum.

Beneficiaries of non-spousal inherited IRAs cannot make new contributions to the account. Instead, they must begin taking distributions by Dec. 31 of the year following the death of the IRA’s original owner.

The exact amount that will need to be withdrawn annually depends on the inheritor’s age. You can check out the IRS’s Single Life Expectancy Table here to calculate how much you would have to withdraw each month from an inherited IRA at various ages.

Failure to withdraw the Required Minimum Distribution (RMD) can mean getting hit with a 50% penalty on the remaining RMD. For example, if you were required to withdraw $7,000 from an inherited IRA per year, but you only withdrew $2,000 one year, you will need to pay a full 50% penalty on the remaining $5,000. That means that $2,500 will go to Uncle Sam instead of into your Destinations Credit Union account.

Multiple beneficiaries

When there are several beneficiaries for a single IRA account, each beneficiary must open their own inherited IRA account and transfer the funds accordingly. In most cases of multiple beneficiaries, RMDs are calculated according to each beneficiary’s age. However, if the assets aren’t divided before the Dec. 31 deadline, the RMDs will be based upon the age of the oldest beneficiary until the funds are distributed into each of the beneficiaries’ inherited IRAs.

Roth IRAs

Roth IRAs are not tax-deferred like traditional IRAs, so there is never any income tax to pay on withdrawals. There are also no RMDs at play for the original account owner. RMDs will not affect the surviving spouse either, as long as they change the title of the Roth IRA to list their own name as owner.

However, there are RMDs for non-spousal beneficiaries of Roth IRAs. These beneficiaries are required to begin taking distributions from inherited Roth IRAs in any one of the three manners listed above. If the money has been in the Roth IRA for more than five years, the beneficiaries will not be required to pay any taxes on these distributions.

It’s important to weigh your options now so, if you are the beneficiary of an inherited IRA account, you already have a plan in place for the funds.

Your Turn: Which option do you think is smartest for a beneficiary of an inherited IRA? Share your opinion with us in the comments.

SOURCES:
https://finance.yahoo.com/news/inheriting-ira-apos-know-180500646.html

https://www.marottaonmoney.com/what-you-need-to-know-to-inherit-an-inherited-ira/
http://www.traditionalira.com/inheriting-ira  

All You Need To Know About Wage Garnishment

Q: I have several outstanding debts and I’m starting to worry about wage garnishment.young man looking over bills - concerned What do I need to know? Is there any way I can protect myself if my wages get garnished?

A: Wage garnishment is the process in which funds are deducted from a person’s salary to pay for their outstanding debts

If you owe lots of money, don’t panic; you can prevent a wage garnishment by working out a manageable payment plan with those you owe money to (your creditors). In the event that your wages are garnished, there are steps you can take to reverse the process.

Read on to have all your questions about wage garnishment answered.

How does the wage garnishment process work?

Unless you owe child support, back taxes or student loans, creditors require a court order to garnish your wages. These creditors can include credit card companies; medical facilities, agencies or hospitals; auto loan creditors and more. To garnish your wages, creditors will have to sue you, win the case against you and receive the court order to move forward with the garnishment process.

Once the court order is in a creditor’s hands, they must send you written notification of the wage garnishment at least 30 days before the garnishment is set to begin. The notice must include the following information:

  • Exactly how much money you owe the creditor
  • Instructions for how you can obtain a copy of the loan records
  • Instructions for entering into a voluntary repayment schedule
  • Instructions for requesting a hearing on the planned garnishment

The creditor will then forward a copy of the court order to your employer, who will withhold the garnished amount from your next paycheck. This way, your creditors are getting their due. Unfortunately, that means making do with a skimpier paycheck.

Under federal law, your employer cannot fire you for a wage garnishment. However, if you have multiple garnishments, or a single creditor has garnished your wages for two or more debts, you are no longer protected against retaliation.

How much of my wages can be garnished?

There are strict federal laws limiting the amount of money creditors can skim off your paycheck. By law, creditors of consumer debt can only garnish 25% of your take-home pay, or the amount by which your weekly wages exceed 30 times the minimum wage, whichever amount is lower. Some states have even stricter guidelines and set a lower percentage limit for wage garnishments. When state and federal laws surrounding wage garnishment are in conflict, the law falls on the side that is more favorable to the employee.

Other kinds of debt can have higher maximums for wage garnishment, as detailed below.

What are the most common types of wage garnishment?

The following three wage garnishments are the most common and don’t require a court order:

1.) Child support and alimony

All new or modified child support orders include an automatic wage withholding order.

After the court has ordered you to pay child support, the court or the child’s other parent must send a copy of the order to your employer. The employer is then responsible for garnishing the specified amount from your paycheck and sending it to the child’s other parent. If the court has made you responsible for maintaining health insurance coverage for your child, payments to fund the coverage will be deducted from your paycheck as well.

The amount of money garnished from your earnings for child support varies with circumstance, but it can be as high as 65%.

2.) Defaulted student loans

If you default on your student loan, the U.S. Department of Education, or an agency collecting money on its behalf, can garnish up to 15% of your income.

3.) Back taxes

If you owe money to the IRS, the federal tax agency can help itself to a chunk of your income without obtaining a court order. The percentage of your salary it’ll leave for you varies with the number of dependents you have and the amount of your standard deduction.

To garnish your wages, the IRS is required to send a wage levy notice to your employer, who must provide you with a copy. The notice you receive will include an exemption claim form for you to complete and return.

State tax agencies can also lawfully take a chunk off your salary, though state laws vary regarding how much they can collect.

Can I protest a wage garnishment?

There is always a course of action that’s open to you when you’re the subject of wage garnishment. To protest a wage garnishment, you’ll need to file papers with the court for a hearing date. At your scheduled hearing, you can then present evidence demonstrating that you need more of your paycheck to pay your expenses or that you qualify for an exemption. The judge will then decide to terminate the garnishment or leave it in effect.

Of course, it’s best to avoid having your wages threatened by garnishment in the first place. Once a creditor wins a lawsuit against you, judges tend to be unsympathetic and getting a garnishment lifted can be difficult.

If you’re in over your head with debt, we can help! Call, click or stop by Destinations Credit Union to talk about our debt counseling services and more.  We have recently opened an Operation HOPE Inside office at our Parkville location. The HOPE Inside model, created by financial dignity nonprofit Operation HOPE, provides no-cost one-on-one financial literacy coaching, workshops, and education programming to participants through the support of financial and corporate partners. Destinations is the first credit union in the country to offer this service. Credit and Money Management, a core program of the HOPE Inside adult offering, is provided at this location. The Credit and Money Management Program is designed to transform disabling financial mindsets—teaching people the language of money, how to navigate credit, and make better decisions with the money they have.

Your Turn: Have you ever been the subject of a wage garnishment? Share your experience with us in the comments!

SOURCES:
https://www.garnishmentlaws.org/wage-garnishment-facts/

https://www.garnishmentlaws.org/what-types-of-income-can-be-garnished/
https://www.nolo.com/legal-encyclopedia/if-wages-are-garnished-rights-33050.html