Month: December 2018

All You Need To Know About Wage Garnishment

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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

6 Ways To Earn Money Online

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At Destinations Credit Union, we care about your financial well-being.  Are you looking for some extra cash to jumpstart your savings? Desperate to stop livingwoman opening box paycheck to paycheck? Want to make 2019 the year you finally get debt-free?

Look no further than your computer screen! With nothing but internet access and a modest investment of your time, you can give your budget that extra padding it needs and get a head start on saving for a larger goal.

Read on for six easy ways to earn money online.

Take surveys

Taking surveys in your spare time can be a great way to earn some extra dough fast.

Here are some great survey companies to get you started:

  • Survey Junkie – Redeem points for payouts via gift cards and/or PayPal.
  • American Consumer Opinion – Easy sign up and well-managed.
  • Vindale Research – Pays up to $75 a survey.
  • Ipsos – Simple and easy to use.

Choose one (or more) that works best for you and start earning money today!

Share your Amazon purchase history

Download the ShopTracker app from Harris Poll and help the company track the products Amazon customers purchase most. All you need to do is share the details of your recent Amazon purchase.

The company will ask for info about the purchase, such as the order date, product title, category, ISBN number, release date, condition, seller, list price per unit, quantity and several other details.

Get paid up to $36 per year for doing this small amount of work.

Become a transcriptionist

Are you a quick typist or a fast talker? Then you may want to consider working as a transcriptionist. Sign up for a program like Scribie and get paid to transcribe documents and movies at $5-$20 per audio hour.

The work is extremely flexible and can be done anytime on your schedule. Most files are only six minutes long or less, so the work is interesting and doesn’t get too tedious. You can choose to type the documents or movies, or to dictate them into a talk-to-text program. Plus, there’s an option of getting promoted and earning more once you become more adept at transcribing.

And as a bonus, you’ll learn new things every day!

Monetize your blog or website with Google AdSense

Google ads are all over the internet; now it’s time to make them work for you! If you have a website or a blog (and if you don’t, you can build one in short order) work on monetizing with Google AdSense. You’ll only earn pennies when you start out, but if you work hard at increasing the traffic to your site or blog, it can really help you pull in the big bucks.

Google AdSense is insanely easy to set up. Sign up for a free Google AdSense account and you’ll receive a unique setup code to copy to your site or blog. Once you’ve done that, Google does the rest, tracking your page views, traffic flow and earnings.

Worried about maintenance fees and upkeep work? There are none! Google does it all. That’s why incorporating Google AdSense in your site or blog is such a no-brainer. It’s just a few minutes of your time and then you’ll start earning extra money for doing absolutely nothing.

Of course, the more traffic you draw, the more you’ll make off Google AdSense. The potential to earn an extra few hundred, or even thousands of dollars, via Google will push you to work at drawing more traffic to your content. While it will take work to get there, just imagine pulling in an extra $4,000 a month!

Become an online consultant

Are you an expert in your field? Do your coworkers constantly seek you out for guidance and advice? Why not market your expertise and earn some extra money at the same time?

Online consulting is the perfect side hustle for natural teachers and counselors. You’ll be working with what you’re good at, creating your own hours and schedule and setting up your own pay scale.

You can advertise your services on a public forum like Craigslist, or set up a free profile on Clarity.fm. People will then be able to look you up on their own. Once word spreads and your name is out there, you can raise your rates and earn more in less time.

Let your talents pay off!

Sell your stuff on eBay

Yes, we know, eBay is the dinosaur of online commerce, but even dinosaurs have their days. The next time you want to throw out an unused piece of junk, a defunct device or an ancient gadget, skip the trash can and sell it on eBay instead. The auction platform guarantees you’ll get the best price for your junk and the site is fully secure. Why not make money off your garbage?

The internet has changed the world forever. Use it to earn extra cash and turn your financial world around!

Your Turn: Do you earn money online? Share your method with us in the comments!

SOURCES:
https://www.thefrugalprof.com/23-ways-to-make-extra-money-in-2019/
https://www.google.com/amp/s/www.forbes.com/sites/jrose/2018/04/24/make-money-online/amp/
https://money.usnews.com/money/personal-finance-saving-and-budgeting/articles/how-to-earn-money-online

How To Consider Car Depreciation When Getting A Car Loan

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If you are thinking about investing in a new car, you may be planning to use a car loan.car depreciation auto loan

Though this is a common process, not all vehicle loans are the same. The type of vehicle, its condition, and it’s worth in the long term can play a role in the type of loan that is right for your needs.

Carefully take into consideration your options, especially when it comes to depreciation.

What Is Car Depreciation?

Every piece of property you own depreciates in value over time. As soon as you buy something, it is no longer new, and selling it would result in a lower price than what you paid for it.

The same applies to vehicle loans. When you buy a brand-new car, no one else has owned it. Yet, as soon as you drive it off of the lot, the value falls. The vehicle now has an owner. It is no longer possible to sell it as new. This causes near instant depreciation in the value.

Does that mean you should not purchase a new car? Some may say this is not ideal, but it is possible (and beneficial to many) to do so.

Factors To Consider With Car Depreciation

It’s important to make the right decisions based on whether or not you plan to maintain the car long term or sell it soon. This will drive your choice in whether you decide to buy a new or used vehicle.

How Much Is Your Vehicle Likely To Depreciate?

The rate of car depreciation depends on many factors.

Normal use drops the value of a car over time. Just aging makes the car worth a bit less. Accidents can speed up that depreciation as well.

More so, the rate of depreciation can also be impacted by the car itself.

For example, some makes and models are going to depreciate faster than others. A high-end, limited edition vehicle is likely to maintain its value longer than a standard passenger vehicle from a well-known manufacturer.

What To Expect In The First Years

During the first year of ownership, vehicle value falls the most.

In some situations, you can expect to see the car’s market value drop by as much as 20 percent in that first 12 to 18 months. The drop in value continues after this point, though at a slower pace overall. However, by the time you have owned the vehicle for five years, the value will have fallen, on average, about to about 60 percent of the original value.

Why Does Depreciation Matter?

It doesn’t have to matter to everyone. Some people purchase vehicles to use for years to come. In this case, it doesn’t matter to you if the value drops over those first few years. However, others may find it to be worrisome.

For example, if you buy a car and want to sell it in a year, chances are good you will get a fraction of its worth. And, that is where the problem with car loans can play a role.

Let’s say you buy a vehicle for $30,000. You love it, drive it, and enjoy it for the first few months. However, that two-seater trendy car isn’t going to work for you any longer now that you are expecting a child. You decide to sell the car.

The loan you took out was for the full value of the car. That $30,000 loan has only been paid down to about $27,000 at this point. Yet, the market value of your car has fallen by 18 percent. Now, it is only worth $24,800.

Consequently, you now owe more on the vehicle than it is worth.

Take Into Account Trade-In Value

The vehicle’s trade-in value can be a good starting point for considering depreciation.

Look up the trade-in value for the car you plan to buy or one very similar to it. Use it as a way to determine how much the car may be worth in a year or five. Having this information, you can then go through your loan options.

Choosing A Loan With Depreciation In Mind

All these factors considered, you may be wondering about your options.

Should you avoid buying the new car you love? That does not have to be the case.

There are a few things to keep in mind, though.

1. Long-Term Loans Are Risky

When you factor in car depreciation, the value of a vehicle after a long-term loan can be very little.

Try to choose a loan that is paid in full within five years. This helps ensure the vehicle is worth a significant amount at the time the loan is paid off. And, as a result, you may be able to sell it or trade it in if you plan to buy a new car.

2. Buy New Only When You Are Confident

When buying a new car, always make the best decisions for your needs based on the next year or two. Realize the value of the car will depreciate significantly within the first 18 months. If you are sure you will be able to maintain the loan during that time, invest in it.

Another option is to think about leasing the car instead of buying a new car outright. Though it is important to consider the limitations in leasing, it may work for those who want to switch between vehicles in a year or less.

3. Choose Used If The Vehicle Meets Your Needs

For those who are unsure if they can stay in the same vehicle, consider buying a used vehicle.

As a used vehicle, the value has already depreciated rapidly. While it will continue to drop in value, the pace will be slower. With a lower price, even a one-year-old vehicle is going to be a better investment.

Understanding Vehicle Value And Car Depreciation

Work closely with Destinations Credit Union on the loan as well. Be sure it fits your budget, but offers the shortest repayment time possible.  We offer great low rates and flexible terms to meet your needs.

In the long term, this helps you to save money and still maintain a significant trade-in value if you have to sell it before you pay it off.

You may also be interested in these related articles:

 

 

 

Is Life Really Getting More Expensive?

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If you feel like the middle-class squeeze is getting tighter each year, you’re not alone. Thegrandparents with two young children numbers don’t lie: Life really is a lot more expensive than it used to be.

As we bid farewell to 2018 and sail into a new year, let’s take a look at what life costs like now compared to 20, 50 and 80 years ago.

Housing

Owning a home is integral to the Great American Dream. But with today’s cost of living, the dream of buying a house is becoming more distant for many median-income families.

Consider these numbers:

Median price of a home in 1940: $2,938

Median price of a home in 1970: $23,600

Median price of a home in 2000: $119,600

Median price of a home in 2018: $368,500

The rise in home prices has been meteoric. If we’d adjust these numbers for inflation, the median home price in 1940 would only be approximately $40,000 in 2018 dollars.

In short, you need a lot more money today to buy a home than you previously did. All of this explains why the average homebuyer in 2018 is 44, as opposed to the average homebuyer in 1981, who was aged 25-34.

Consumer prices

The price of everything, from a sack of flour to a winter coat, keeps climbing every year. Since 1970, the Consumer Price Index saw a 500%-plus increase. Even after adjusting for inflation, today’s dollar buys a whole lot less than it did 50 or even 25 years ago.

For example, a gallon of gas in 1994 cost just $1.06. In late 2018, the average price for a gallon of gas was $2.88, a full 75% higher than it should be if the price only increased with inflation.

Purchasing today’s basics takes a lot more money than it did for past generations.

Education

Education today is more expensive than ever.

In 1971, a year of tuition at Harvard University cost students just $2,600. For the 2016-2017 school year, the annual tuition at Harvard jumped to $43,280, or more than $60,000 when you include additional costs like room, board and other fees,. That’s a markup of more than 1,550 percent!

It’s a lot harder to pay off student debt today, too. In 1970, a college student could spend a year working just 14 hours a week at a minimum-wage job to pay for a year of schooling. Today, to earn enough money to pay for a year of college, students need to work 35 hours a week. Essentially, in 1970, it was feasible for a student to graduate from college without going into debt, something that’s almost impossible now.

The rising cost of higher education has led Americans to owe a collective $1.4 trillion in student loan debt.

Wages

When adjusted for inflation, wages haven’t changed all that much in the last 50 years.

According to the U.S. Census Bureau, the average wage-earner pulls in just 10% more today than they did in 1970, while prices of homes have risen at a much quicker rate.

In the 1970s, it was possible for a family to put just 50% of their income toward major expenses like housing, education and health care costs. Today, the average family puts 75% of their income toward these expenses, leaving limited means for everything else.

Is there a solution?

The first step toward loosening the middle-class squeeze is acknowledging that it’s not your fault if you feel like you’re drowning-life is simply more expensive.

If you’re an exasperated parent wondering why the kids of today can’t seem to get it together, give those kids a break; they’re working with harsher circumstances than those you faced when you left school.

If you’re a struggling student, take heart. You don’t need to follow your parents’ footsteps and finish paying off your college tuition before you graduate, nor must you buy your first home at age 26. Those goals are a lot harder for you than they were for your parents’ generation.

Also, there are ways you can work with what you have today.

First, regardless of your life stage or circumstance, it’s crucial that you build and maintain an excellent credit score. This will enable you to purchase your first home and/or take out other large loans at the best possible terms. Always pay your bills on time, keep your credit utilization rate low and hold onto your cards for several years to build a strong credit history.  Need help with this?  Contact Destinations Credit Union – we have some great resources to help you out!

Another important way to drastically cut down on your cost of living is to consider a major move. According to the U.S. Bureau of Labor Statistics, the average household spends close to $19,000 annually on housing-and that number rises in major cities. You can save big on this expense by moving to a city with lower housing costs.

You may want to move to a nearby town and simply commute to your job. For instance, if you were to move from New York City to a nearby suburb, you can save more than $71,000 annually in housing costs, even when accounting for heightened transportation costs.

You may also want to consider moving further away and starting over. You’ll be able to work at a lower-paying job, since moving from a big city can slash your living costs by up to 45%.

You may even be able to keep your current job in a new town; lots of today’s jobs are mobile, or even allow you to work from home. This way, you’ll be earning the same pay and have a lower cost of living, making you that much richer at the end of the month. You can use your spare change to enjoy a more favorable monthly budget and to start saving for a wealthier future.

Some cities that offer a great balance between high wages, low housing costs and a decent quality of life include Grand Rapids, Michigan; Columbus, Ohio; Kansas City, Missouri; Tampa, Florida; Omaha, Nebraska and Salt Lake City, Utah.

There’s no way to fight the rising costs of living, but with some careful planning, you too can achieve the Great American Dream.

Your Turn: Do kids today really have it that much harder than their parents? Share your thoughts with us in the comments!

SOURCES:
https://www.google.com/amp/s/m.mic.com/articles/amp/188498/average-cost-of-living-increase-us-2018-calculator-best-cities-health-care-education
https://www.google.com/amp/s/www.cnbc.com/amp/2017/06/21/life-is-much-more-expensive-for-you-than-it-was-for-your-parents.html
https://www.google.com/amp/s/www.marketplace.org/amp/2016/06/09/economy/does-middle-class-life-cost-more-it-used
https://www.thesimpledollar.com/a-dose-of-financial-reality/
https://www.investopedia.com/ask/answers/101314/what-does-current-cost-living-compare-20-years-ago.asp#ixzz5Xpg70y4J
https://www.google.com/amp/s/amp.businessinsider.com/millennials-cost-of-living-compared-to-gen-x-baby-boomers-2018-5
http://www.1970sflashback.com/1970/Economy.asp

7 Naughty Scams To Watch Out For This Holiday Season

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‘Tis the season to be jolly! And unfortunately, ’tis also the season for scammers to go afterMan sitting among computers with santa hat on your hard-earned dollars. Keep your money safe by reading up on the most common scams taking place this time of year and practicing caution.

Phishing emails

Always popular, phishing scams get even more prevalent before the holidays. They can take the form of bogus delivery confirmation requests seeking your information or even a personalized letter to your child from “Santa.”

Be extra careful this holiday season when it comes to sharing personal information online or with an unverified requester.

Fake charities

Sadly, many scammers will capitalize on the goodwill that flourishes this time of year by asking you to make a donation to a charity that does not actually exist. Verify the authenticity of any charity you’d like to make a contribution to by checking it out on a website like  CharityNavigator.org. Also, it’s best to contact a charity on your own instead of following a website or email link.

Package theft

It’s holiday time, and those UPS and FedEx trucks are everywhere, dropping off boxes of goodies all over the neighborhood.

Usually, these drop-offs go as planned. Unfortunately, though, some 23 million customers will have their packages stolen from their doorsteps this year.

Don’t be one of them! If possible, and especially when ordering something expensive, arrange for a delivery that requires your signature upon receipt. Otherwise, track your order and know when to look out for it so you can bring it inside as quickly as possible after it’s dropped off.

When sending a gift to someone else via Amazon, consider sending it to an Amazon Locker location instead of to the recipient’s household. There’s no fee for using this service, and this way, your gift is safe.

Bogus sites

You might get lucky and find that perfect gift at a super-low price, but don’t believe any ads or websites that are practically giving away the good stuff for free. These are, quite likely, scams. Once you click an ad link and place an order, you’ll never hear from the site again. Worse yet, they may use the information you shared to empty your accounts.

Only shop on reputable sites. Remember to check the website address/URL before placing an order. It may look strikingly similar to a popular site, but if one letter is off or missing completely, the site is bogus and you need to get out. Also, always look for that important “s” after the “http” in the web address to verify a site’s security.

Fake freebies

Did you really just see a Facebook post offering you a new iPhone, completely free of charge? If you have, run the other way and don’t look back! You’re looking at a scam, designed to lure you into sharing your information with criminals or unwittingly installing malware on your device.

Fake freebies run the gamut from new phones, complementary cruises and various luxury gift items to free holiday-themed downloads, like music, wallpaper and games.

If you’re offered any outrageous free gifts by text message, email or social media posts, ignore them. Downloads, though, may be safe, but need to be carefully vetted for authenticity before you accept them.

Defunct gift cards

Many scammers sell expired or empty gift cards this time of year, hoping to make a profit on a card that isn’t worth more than the plastic used to make it.

Ask to inspect any gift card you purchase before you finalize the sale. Check to see if the activation code is exposed. If it is, the scammer has probably already used the card or has copied the information and will use it soon.

Temporary holiday jobs

Lots of businesses are hiring extra hands to get them through the busy holiday season. Don’t get stuck working for criminals!

Many scammers will pose as employees of recognized businesses and post help-wanted ads on social media platforms and popular websites. When a job seeker follows the links in these ads, they are directed to a bogus site that looks just like the site of the company the scammer claims to represent. They’ll be asked to share personal information to submit an application. The scammer will then make off with this information and the promised job will never materialize.

If you’re looking for a seasonal job, apply in-person or directly on a business’s website. Do not follow any links.

As always, be aware and be cautious when enjoying the holiday season. Don’t get grinched! Stay alert and use caution to keep your money – and your information – safe.

Your Turn: Have you been targeted by these or any other seasonal scams? Tell us all about it in the comments.

SOURCES:
https://www.aarp.org/money/scams-fraud/info-2017/holiday-season-scams-photo.html
https://www.moneytips.com/9-scams-to-watch-out-for-this-holiday-season
https://www.consumer.ftc.gov/articles/0074-giving-charity#Signs

Brought to you by Destinations Credit Union.