5 Ways To Trim Your Fixed Expenses

When trying to trim a monthly budget, most people don’t consider their fixed expenses.

calculator, pen, glasses on monthly income and expense sheet

Managing monthly expenses and personal finance.

These recurring costs, which include mortgage payments, insurance premiums and subscription payments, are easy to budget and plan for since they generally remain constant throughout the year. While people tend to think there’s no way to lower fixed expenses, with a bit of effort and research, most of these costs can be reduced.

Here are five ways to trim your fixed expenses.

1. Consider a refinance

Mortgage payments take the biggest bite out of most monthly budgets. Fortunately, you can lower those payments by refinancing your mortgage to a lower interest rate. The refinance will cost you, but you can roll the closing costs and other fees into your refinance loan. Plus, the money you save each month should more than offset these costs. A refinance is an especially smart move to make in a falling-rates environment or if your credit has improved a lot since you originally opened your mortgage. If you want to explore this option, go to Destinations Credit Union‘s First Mortgage Center.

2. Lower your property taxes

Taxes may be inevitable, but they aren’t set in stone. You may be able to lower your property taxes by challenging your town’s assessment of your home. Each town will have its own guidelines to follow for this process, but ultimately you will agree to have your home reappraised in hopes of proving its value is less than the town’s assessment. This move can drastically lower your property tax bill; however, if you have made improvements to your home, it may be appraised at a higher value, which could raise your taxes.

3. Change your auto insurance policy

The Geico gecko and Progressive’s Flo, who love disrupting your favorite TV shows, actually have a point: You may be overpaying for your auto insurance policy.

If you’ve had the same policy for several years, speak to a company representative about lowering your monthly premiums. By highlighting your loyalty and having an excellent driving record, you may be able to get a lower quote. You can also consider increasing your deductible to net a lower monthly premium.

If your insurance company is not willing to work with you, it might be time to shop around for a provider that will. A few minutes on the phone can provide you with a significant monthly savings for a similar level of coverage. Once you have a lower quote in hand, you can choose to go back to your original provider and tell them you’re seriously considering a switch; they may change their mind about their previous lowest offer.

4. Consolidate your debts 

If you’re carrying a number of outstanding debts, your minimum monthly payments can be a serious drain on your budget. Plus, thanks to the high interest rates you’re likely saddled with, you might be feeling like that debt is going nowhere.

Lucky for you, there is a way out. If you have multiple credit cards open, each with an outstanding balance, you might want to consider a balance transfer. This entails opening a new, no-interest credit card, and transferring all of your debts to this account. The no-interest period generally lasts up to 18 months. Going forward, you will only have one debt payment to make each month. Plus, the no-interest feature means you can make a serious dent in paying down that debt without half of your payment going toward interest. Be careful in opening new cards if your credit is already poor.  Opening a new one can lower your credit score for a few months.

Another way to consolidate debt is to take out a personal loan at Destinations CU. Our personal loans will allow you to pay off all of your credit card debt at once. With interest rates starting at just 10.5% APR, you’ll only need to make a single, affordable monthly payment until your loan is paid off.

5. Cut out subscriptions you don’t need

Another fixed expense most people mindlessly pay each month are subscriptions. Take some time to review your monthly subscriptions and weed out those you don’t really need. Below, we’ve listed some of the most commonly underused monthly payments:

  • Gym membership. Are you really getting your money’s worth out of your gym membership? It may be cheaper to just pay for the classes you attend instead of a full membership. Or, if you have a favorite workout machine at the gym, consider purchasing it to use at home for a one-time cost that lets you to drop your gym membership.
  • Cable. Why are you still paying for cable when you can stream your shows for less through services like Netflix and Hulu? If you don’t want to cut out cable entirely, consider downgrading to a cheaper plan that drops some of the premium channels you don’t watch much.
  • Apps. How many apps are you signed up for? You may not even remember signing up for an upgraded version of an app you rarely use. A quick perusal of your monthly checking account statement or credit card bill can help you determine how much these subscriptions are costing you. Drop the apps you’re not using for more wiggle room in your monthly budget.

Your fixed monthly expenses are actually not as “fixed” as you may have thought. By taking a careful look at some of these costs, you can free up more of your monthly income for the things that really matter.

Your Turn: How have you lowered your fixed monthly expenses? Share your best tips with us in the comments.

Sources:
https://www.debtroundup.com/save-money-cutting-called-fixed-expenses/
https://www.experian.com/blogs/news/2012/12/19/fixed-expenses/
https://www.thesimpledollar.com/save-money/trimming-the-fat-forty-ways-to-reduce-your-monthly-required-spending/

How to Create a Budget in 6 Easy Steps

Who needs a budget anyway?

If you’re always wondering how you’re going to pay the next bill, feel guilty when you indulge in overpriced treats and you can’t seem to find money to put into savings, then you probably need a budget.

A budget is not a magic potion that will automatically solve all of your money problems, but it will help you gain financial awareness. That, in turn, will help facilitate more responsible decisions.

Lots of people think budgeting is overly tedious, and that living within a budget means never indulging in a $6 latte or a pair of designer jeans again. The reality, though, is almost the complete opposite. A well-designed budget may initially take time to create, but once it’s up and running, it shouldn’t take you long to maintain. You’ll then sleep better at night knowing you can comfortably cover all your expenses. And, perhaps most shockingly, a good budget allows for the occasional treat—without the guilt.

Here’s how to create a budget in 6 easy steps:

Step 1: Gather all your financial information

Collect all of your financial documents and receipts for three consecutive months. This includes all account statements, bills, pay stubs, receipts and more. You can save all these documents over the three months, or you might be able to access this information online, especially if you’re a heavy card user who rarely uses cash.

Step 2: Tally up your totals

Divide your documents into expenses and income. Then, list the corresponding numbers on a spreadsheet. As you work through these lists, include occasional and seasonal expenses, dividing these expenditure groups by 12 to spread them evenly throughout the year.

When you have your numbers, take a look at how they match up. In the best-case scenario, your income will exceed your expenses. If the numbers are too close for comfort, or your expenses outweigh your income, you’ll need to trim your spending and/or look for ways to boost your income so you don’t end up deeply in debt. You can also review your fixed expenses to see if there’s any way to bring those values down, such as refinancing your mortgage to a lower rate, switching to cheaper car insurance policy or cutting out a monthly bill you don’t really need.

Step 3: List all your needs

Take a look at how you’ve spent your money in the recorded time and weed out all the actual needs from your list. This will include fixed expenses like mortgage/rent payments, savings, insurance premiums, car payments, minimum loan payments and childcare costs; as well as fluctuating but necessary expenses, like groceries, clothing and other dry goods. To keep it simpler, list your fixed expenses first, followed by your non-fixed expenses.

Separating your needs from your wants can get a bit tricky, and you’ll need to use your common sense. For example, you need to eat, but do you really need to eat organic? If this is an important value to you, the answer may be yes, but if it’s something you’d only prefer if possible, it may be more of a want.

As you list each need, write down its corresponding cost. When you’ve finished creating this list, add up the total.

Step 4: List your wants

Your next step is going to be all about the stuff you love to spend money on but can really live without. Include entertainment costs here, as well as eating out, gifts, expensive hobbies and anything else that costs money, but is not an absolute necessity.

Here too, jot down the monthly cost of each item on your list and tally up the total when you’re done.

Step 5: Assign dollar amounts to your expenses

You’re now ready to do the nitty-gritty work of budgeting. Open up a new spreadsheet and copy your lists of expenses, starting with the fixed-cost needs, then your non fixed-cost needs, and finally listing your wants. Remember to include your occasional and seasonal expenses here as well. Assign a fixed amount to each of these costs and plan to have that amount automatically transferred into a special savings account. This way, when you need to meet that expense, you have the money on hand to cover the cost.

There are several schools of thought when it comes to creating a budget. To keep things simple, we’ve outlined just two of the most popular budgeting methods for you to choose from.

The traditional budget involves assigning a specific dollar amount to each expense category. If your budget allows, simply use the average amount you’ve spent in each category for the last three months to set the cap for that expense. For example, if you spent an average of $600 on groceries, jot down that number near this category in your budget. Continue until every dollar is accounted for and you have enough money in your budget to cover every need, want and occasional expense. If your expenses outweigh your income, you’ll need to trim some expenses for your budget to work.

The 50/30/20 budget is simpler but requires more discipline. Set aside 50 percent of your budget for your needs, 30 percent for your wants, and the remaining 20 percent for savings. If you want to use this kind of budget, divide up your numbers accordingly to see if it can work for you. Does 50 percent of your income cover the total amount you listed for your needs? Is 30 percent enough for your wants? If it can work, this type of budget allows for more individual choices each month and less accounting.

Going forward, be sure to spend only the assigned amounts for each expense category.

Step 6: Review and adjust as necessary

Review your budget each month to see if you’re staying on track. If you consistently overspend in a category, move some numbers around and spend less in another area so you have more money available to meet your needs. Remember: A budget should be freeing, not restrictive. If yours is not working for you, adjust and tweak it until you can stick to it easily.

Your Turn: Do you stick to a strict monthly budget? Share your best budgeting tips with us in the comments.

Is The OnMyWay App Legit?

At first glance, it seems like a brilliant idea. But is it legit?OnMyWay logo

The OnMyWay app, established in 2017, has recently taken social media by storm. It was created to incentivize drivers to practice safety on the road by offering monetary rewards for safe driving. But, while the concept is great, the execution of the app falls abysmally short.

Let’s take a closer look at the OnMyWay app so we can determine whether it is safe, secure and legit.

The way it works

The sole function of the OnMyWay app is to promote safer driving through financial incentives. Once you’ve installed the app, it will automatically activate whenever you start driving. Keep your phone locked, with all texting options disabled, and you’ll earn cash for each mile you drive. OnMyWay promises users $0.05 for every safely driven mile, $2 for each referral and an additional $0.02 for each mile driven that’s safely by friends they’ve referred.

According to the app’s co-founder, Chloe Palmer, car accidents caused by texting are currently the #1 cause of death for young adults aged 16-25. “OnMyWay believes that by giving our users positive rewards, we can end this horrific epidemic,” she says.

It truly sounds like a noble idea, and thousands of drivers have rushed to download the app. Motivate yourself to drive safely and earn cash at the same time—it’s a win-win!

How it really plays out

Unfortunately, as many OnMyWay users are discovering, the app’s reward system is not as straightforward as they might believe.

First, the app does not reward safe driving with money in users’ checking accounts. Instead, the money “earned” is set up as a reimbursement. Users need to link a credit card or checking account to the app, pay the full amount for a purchase up front and then wait to be reimbursed.

Second, OnMyWay money can’t be spent everywhere. Earnings must be spent at specific retailers that are recommended by the app—and sometimes, for specific products as well. These may or may not be retailers users usually patronize or items they’ve planned on purchasing. Many users complain that the products “recommended” by the app are all overpriced luxury items they would never have considered buying otherwise. The app claims it is working on updating its system to include nationally recognized retailers, like Amazon. For now, though, redeemable purchases are extremely limited.

But is it safe? 

Aside from the obvious inconveniences of the app, many users are concerned about its security. OnMyWay requires all new users to scan their ID before installing the app. Users must also link a checking account or credit card to the app to be reimbursed for purchases. In a world where another scam makes headlines every week, users are wary about sharing this information with a relatively new app.

OnMyWay promises that users’ information is completely safe.

“Our system is 100 percent encrypted,” Palmer says.

The app’s founders claim to use third-party software to link users’ financial information. The software is highly secure and is used by recognized online payment platforms, like Venmo.

To date, there have not been any incidents of scams employed through OnMyWay. It may not deliver exactly what it promises, but at the very least, you can be sure your information is safe with OnMyWay.

What users are saying

Drivers who have downloaded OnMyWay are quick to praise the concept of an app providing an incentive for safer driving. However, nearly every user is disappointed with the way the app operates. Many complain that the app is purposely vague about the process of cashing in rewards until they’ve already downloaded it and started using it.

Many users also claim that, once they’ve made a purchase recommended by the app, it takes far too long for OnMyWay to reimburse them with their earned cash, with wait times often stretching longer than a week. Finally, drivers are disillusioned with the app’s customer service and many claim it is simply nonexistent.

Some users, though, are thrilled with the chance to earn money while driving, regardless of the many strings attached to the deal.

The takeaway

The OnMyWay app is a wonderful concept with poor implementation; however, there is no scam here: The app is a legitimate service that is not doing anything that may be considered outright criminal.

Unfortunately, though, the app does engage in misleading advertising and ambiguous claims. After reading the app’s own reviews and descriptions, it’s easy for users to falsely assume they can rake in the big bucks just by signing up for OnMyWay and driving safely. Users are keenly disappointed when the app does not deliver as promised.

While the app is safe and legit, most users agree that it is hardly worth the effort.

If you think otherwise and you’re eager to earn rewards for driving safely, be sure to read all the fine print before signing up and installing the app.

Whichever choice you make, it’s always a good idea to disable all texting options on your phone before hitting the road. A safe arrival to your destination is an incentive in and of itself!

Your Turn: Do you think the OnMyWay app is worth using? Why, or why not? Share your thoughts with us in the comments.

Sources:
3Newsnow.com
OnMyWay.com
reddit.com

Should I Refinance to a 15-year Mortgage?

With mortgage rates falling and financial experts predicting an unstable future for the couple looking at computer.screeneconomy, lots of homeowners are rushing to refinance their mortgages to lock in low rates. One increasingly popular option is to refinance a conventional 30-year mortgage into a 15-year loan.

Borrowers may be wondering if this is a financially sound move to make for their own home loan.

We’ve researched this option and worked out the numbers so you can make a responsible, informed choice about your own mortgage.

When refinancing can be a good idea

The primary attraction to a shorter mortgage term is paying off your home loan sooner, typically at a lower interest rate. This can help you increase your home equity faster and can mean paying thousands of dollars less in interest over the life of the loan. Therefore, refinancing to a shorter-term loan makes the most sense when interest rates are falling.
It’s also a particularly good idea for homeowners who can easily afford to increase their existing monthly mortgage payments. In addition, homeowners whose home values have increased since they financed their original mortgage will be more likely to qualify for a 15-year loan, since they will have a lower loan-to-value ratio —how their home’s current value compares with their current loan balance.

How much money can I save?

There is no quick answer to this question, as there are several variables at play in each refinance. To provide a basic idea of what a shorter-term home loan can mean for your finances, let’s take a look at how the numbers would work out in a 15-year refinance on a conventional home loan.

As mentioned, a 15-year loan generally carries a lower interest rate than a 30-year loan. If national interest rates are falling when you refinance, and/or your credit has improved since you bought your home, your interest rate can be even lower. According to Bankrate’s most recent survey of the nation’s largest mortgage lenders, on Dec. 6, 2019, the benchmark 30-year fixed mortgage rate was 3.74 percent and the average 15-year fixed mortgage rate was 3.16 percent.

Let’s assume you refinance your fixed $300,000 mortgage with an interest rate of 4.5 percent to a 15-year loan at an interest rate of 3.5 percent.

If you kept your existing mortgage unchanged for 30 years, you’d be making 360 payments over the life of the loan at $1,520.06 a month, not including taxes, insurance and other fees.

Toward the beginning of the loan, an overwhelming majority of your monthly payment will go toward interest, with less than $400 going toward your principal. By the time you pay off your loan, this ratio will reverse itself and the majority of your payments will go toward the principal of the loan. Most importantly, over the life of your loan, you will have paid $247,220.13 in interest.

Now let’s explore what these payments would look like if you refinanced this loan to a 15-year fixed-rate loan at a 3.5 percent interest rate.

Over 15 years, you would make 180 payments of $2,144.65. Over the life of the loan, you’d be paying $86,036.57 in interest payments, bringing significant savings of $161,183.56. You’d also be chipping away at your principal at a far quicker pace, with $1,269.65 of your very first payment going toward the principal of the loan.

If these numbers are exciting you about getting your refinance process started, take a step back and slow down. First, these numbers may or may not translate directly to your own situation. In the above example, savings are calculated over 30 years, but you may be nearing the halfway point of your 30-year mortgage. A refinance can still be a good idea if it can get you a lower rate for the remainder of your loan, but your interest savings will be significantly less than those described above. Second, your interest rate may not be a full point lower after a refinance, as it is in our example. This, too, will afford you less savings.

There are other crucial factors to consider before jumping into a 15-year refinance. Read on for a review of some of the more important variables to think about when making this decision.

What will a refinance cost?

Refinancing your mortgage is not cost-free. Expect to pay a minimum of 2.5 percent of your new loan in closing costs and other fees.

Here are some of the possible fees you can expect during the refinance process:

  • A fee for pulling your credit
  •  fee for processing your paperwork
  • Lawyer fees
  • An inspection fee
  • Discount points, each of which are equal to one percent of your home loan, which will give you a lower mortgage rate
  • An appraisal fee
  • A surveyor fee
  • Title search fee
  • Title insurance

Before you get started on the refinance process, it’s a good idea to tally up these expenses and see how much it would cost you to refinance.

You might be offered the option of refinance at no cost. This means your closing costs will be rolled into your new mortgage payments. This can make financial sense if it means saving money in the long term, but it’s a good idea to work out the numbers before you continue with the process.

Finally, your existing mortgage may have prepayment penalties, which can cut into the amount you’ll save by refinancing. Find out about these fees before you set the refinance process in motion.

When refinancing to a 15-year mortgage is not a good idea

If you’re convinced that a 15-year refinance is right for you, make sure to consider this crucial factor before going ahead with the refinance: Your monthly mortgage payments will increase significantly after a 15-year refinance. In the example above, the mortgage payments increased by $624.59 a month. Your own payments may see a similar change, and any increase will impact your finances.

If you’re financially responsible, you won’t consider this move unless you are confident you can afford to meet this increased mortgage payment. However, you may not realize that tying up your spare cash in your home’s equity can be a risky move. It can make more financial sense to first build an emergency fund with 3-6 months’ worth of living expenses, and to increase your retirement contributions. If you’re carrying any high-interest debt, you’ll want to pay that down, too, before moving ahead with a refinance.
Increasing your monthly mortgage payments can mean leaving you with a tighter monthly budget and very little breathing room. Make sure you are fully prepared to swallow these costs before you go ahead with a refinance.

Are you ready to make the move to a shorter-term loan? Speak to a representative at Destinations Credit Union‘s First Mortgage Center today to learn about our fantastic home loan options.

Your Turn: Have you refinanced to a 15-year mortgage? Tell us about it in the comments.

Sources:
Bankrate.com
Money.com
Mybanktracker.com
Themortgagereports.com

How to Make Your Career Choice Fit Your Budget

As you prepare for graduation and begin scouting different employment opportunities, woman studying bills for budgetingbe sure to look at the larger picture before you accept a position.

Hopefully, you’ve chosen a career path that will bring you joy and gratification. Equally important, though, is a job that can support your lifestyle choices. While the positions you consider for your first post-college job will likely offer the opportunity for growth, you’ll still need to pay your bills—and make your student loan payments—as soon as you graduate. A job that brings you satisfaction and a pleasant working environment will not last long if the salary it offers causes you to sink into debt.

How do you determine what kind of salary will be large enough to support your desired lifestyle?

To get this information, you’ll need to create a mock monthly budget for your post-college self.

Using a spreadsheet or paper and pen, create two columns, one for expenses and one for actual dollar amounts. In the expense column, list your typical monthly expenses, including housing costs, transportation costs, health insurance, groceries, entertainment costs, clothing costs, dining out, savings, etc. In the dollar column, list the amount of money you expect to pay every month for each expense.

Your budget should look something like this:

Expense – Monthly Cost

Housing $1200
Transportation $300
Health insurance $250
Groceries $350
Student loan payments $350

It will take some research and some hard, honest thinking to come up with these numbers. For housing costs, take a moment to think about where you see yourself settling down after college. You don’t have to know the exact neighborhood you’ll live in, but it’s good to know the city that will work best for you in terms of lifestyle, career path, and family plans. You can narrow this down to a few choices so long as you keep it reasonable. Once you’ve chosen your desired location, research the median rental prices in the area on real estate sites like Zillow and Redfin.

Next, work on transportation costs. If you already own a car, you’ll have an idea of what it costs you each month. Otherwise, spend some time thinking about what kind of car you want to drive. You can find listings on Carfax.com. Include costs like auto insurance, gas, and upkeep, in this category.

Or, if you plan on living somewhere with reliable public transportation, you might choose this route instead. Make a calculation of how much you’ll spend on bus and/or train rides, along with the occasional cab or ride-share ride.

Complete your budget using your best estimates for each category. Once you’ve filled out each expense amount, add up your total and multiply it by 12 to give you the amount of money you’ll need each year for supporting the lifestyle of your choice. (This number will increase with inflation, but since current salaries will likely increase along with the inflation rate, this exercise can still give you an idea of the annual salary you’ll need.)
Now that you have these numbers, you’re ready to go ahead with your job search. When considering possible positions, you don’t have to choose the one that pays the highest salary if there are other things about the job you don’t love. However, it’s best to pursue positions that can actually support you.

Your Turn: Are you choosing your first job for the salary or for other factors? Share your take with us in the comments.

Sources:
http://knsfinancial.com/career-path-choosing/
https://money.usnews.com/money/blogs/outside-voices-careers/2010/12/06/how-to-choose-a-career-thats-best-for-you
https://money.usnews.com/careers
https://www.brazen.com/blog/archive/career-growth/5-questions-that-will-help-you-choose-the-right-career/

All You Need to Know About Data Breaches

If you follow the news, you’ll note that there seems to be another major data breach person typing on keyboard with graphic locks over the imagemonopolizing headlines every week. The details vary, but in each breach, thousands, millions or even billions of victims’ sensitive information is compromised, and they’re now vulnerable to identity theft unless they take immediate action.

Here at Destinations CU, your financial success and safety is our primary goal. To help keep your information and your finances secure, we’ve compiled a comprehensive guide on data breaches.

What is a data breach?

Data breaches occur when sensitive information is accessed or used without authorization. Factors like a wealth of online data and sophisticated hacking tools have spurred a steep increase in data breaches in recent years, causing tremendous damage to individual consumers and businesses across every industry.

Data breaches occur by exploiting vulnerabilities in a company’s security system. Alternatively, an employee can be tricked into giving a cybercriminal access to the company’s network.

The goal of most data breaches is to obtain personal information, like names, email addresses and passwords, as well as financial information, like credit card numbers and account details. This information is used by criminals to steal identities and empty accounts, or sold to other criminals who will then do so.

While major data breaches make headlines, according to the Identity Theft Resource Center, there is an average of three data breaches each day, most of which will never even make the news.

After a data breach

Whenever you hear about a major data breach that can possibly affect you, it’s best to monitor your accounts for suspicious activity. In most cases, you will be notified by the victimized company if your data has been compromised; however, it helps to keep an eye on your accounts even if you haven’t been contacted so you can minimize your loss by acting quickly if your are among the unfortunate victims.

If you’ve been victimized by a breach

If you’ve been informed your information is compromised by a data breach, take the following steps immediately:

1. Freeze your credit
Placing a freeze on your credit is the most crucial step you can take to stop scammers from getting at your information. A credit freeze will not bring down your credit score, but it will serve as a red flag for lenders and credit companies by alerting them 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 at 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.

2. Change your passwords
Most people are on the alert following a major data breach, but they tend to let their guard down once the heat is off and things calm down. Hackers know this, and they’ll often hold onto victims’ information immediately following a data breach and then sell it months down the line to other identity thieves. To protect your accounts from a delayed-reaction hack, change all of your passwords after a breach that possibly has affected you.

3. File an identity theft report
Unfortunately, these protective measures can sometimes be too little, too late. 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) as soon as possible. This will assist the feds in tracking down your hacker(s) and returning your finances to their usual state as quickly as possible.

Protecting your information

There’s no fool-proof way to protect yourself from a data breach, but following these simple steps can help keep your information as safe as possible:

Monitor your credit. Check your credit accounts for suspicious activity on a regular basis. You can request a free credit report from each of the three major credit bureaus once a year at AnnualCreditReport.com. You may also want to consider signing up for credit monitoring, a service that will cost you $10-30 a month for the promise of notifying you immediately about any suspicious activity on your accounts.

Use strong, unique passwords. Use a different password for each account, and choose codes that are at least eight characters long. Also, use a variety of numbers, letters and symbols. Vary your capitalization use as well, and don’t utilize any portion of your name, phone number or a common phrase as your password. Using a password manager like Dashlane or iPassword can also help keep your information safe. It’s also a good idea to choose two-factor authentication when possible, and non-password authentication, such as face recognition or fingerprint sign-in, for stronger protection.

Browse safely. Never share sensitive information online and always keep your security and spam settings at their strongest levels. Make sure your devices are fully updated at all times. It’s also a good idea to keep your social media accounts as private as possible.

Destinations Credit Union has tools to help you prevent unauthorized use of your account.  In our mobile app, you can sign up for card controls and get notified each time your debit or credit card is used.  In addition, you can get group pricing, as a Destinations Credit Union member, on ID Shield, which helps restore your identity in the event of a theft.

Hackers never stop trying to get at your data, but with the right protective measures in place, you can keep them from seeing success.

Your Turn: How do you protect yourself from data breaches? Share your tips with us in the comments.

Sources:
https://www.forbes.com/sites/nicolemartin1/2019/02/25/what-is-a-data-breach/amp/
https://www.malwarebytes.com/data-breach/
https://www.experian.com/blogs/ask-experian/what-is-a-data-breach/

 

How Men And Women Manage Money Differently

Over the last century or so, society has made tremendous strides toward gender equality happy couple looking at computeron every level — and this includes basic money management. Today’s culture has further narrowed the gap between the sexes, and the caricatures of the “overspending wife” and “overworked husband” have nearly become extinct.

Despite society’s advancements, there are still significant differences in the way each gender relates to and manages money. Dozens of studies have been performed on this subject, with research culled from around the globe. Being aware of these innate differences can help us understand the ways we deal with our finances so we can stop fighting our financial strengths and work on building them instead.

Attitudes toward shopping

Men and women look at shopping very differently. A study by the Wharton School of Business titled “Men Buy, Women Shop” found that women are more likely to view shopping as a recreational activity, while most men just want to get out of that store with their purchase as quickly as possible. Because of this, women will be quicker to notice and care about a store’s environment and the way they were treated by the salespeople.

Spending habits

A Consumer Expenditure Survey by the Bureau of Labor Statistics studied the spending choices of single women and single men. Here’s what they found:

  • Overall spending: Single men outspent single women, but only by a slight margin. Men spent an average of $35,018 a year as opposed to $33,786 by women. It’s important to note, though, that the men earned roughly $10,000 more per year than the women.
  • Food: Single men outdid women here, too. Their annual food bill was $4,173, as opposed to $3,680 for the ladies. They also spent more than double what women spent on alcoholic beverages, at $537 a year compared to the women’s $234.
  • Clothing: Women came in first place in this category. They spent an average of $1,140 on a category titled “apparel and services” while men spent $813. Typically, women’s clothing costs more than men’s even for similar items.
  • Cars: Men outstripped women in this category, spending a total of $5,507 a year on personal transportation costs, compared to women’s $4,273.
  • Entertainment: Men and women spent similar annual amounts on entertainment, but they chose to spend those dollars differently. Men spent an average of $835 on “audio and visual equipment and services” but only $206 caring for pets. Women spent $725 on their home entertainment and $488 on their pets.

It’s not just the spending numbers that set men and women apart, though. There are multiple studies proving that women are more price-conscious shoppers than men. According to PaymentSense, 71% of women say the last item they bought online was on sale, compared to only 57% of men. Coupons are also used more commonly by women than men, with CouponFollow’s 2017 Millennial Shopping Report showing that 74% of millennial women will look for coupons when shopping online, compared to 65% of millennial men.

Financial goals

Which gender has bigger dreams?

That question is difficult to answer, because men and women tend to have different priorities for their savings. A recent survey by The Motley Fool found that men are most likely to name saving for a vacation as their top financial goal, followed closely by paying off credit card debt. Women had identical goals, but they put their credit card debt first and their dream vacation second.

Savings

Although men and women have similar financial goals, there’s a vast difference between how much money each gender sets aside for those goals. A recent report by Mylo Financial Technologies found that men had set aside nearly twice as much money for their long-term financial goals as women. A BlackRock survey published by CNBC had similar findings: American women nearing retirement age had an average of $81,300 in retirement funds, while their male counterparts had $118,400.

However, if you look at the percentage they save from their paychecks, women come in first place. A recent Vanguard study found that women are more likely to participate in workplace retirement plans, and that they put up to 8 percent more of their pretax earnings into these plans than men in the same earnings bracket.

The discrepancy between the dollar amounts saved and the percentages of incomes earmarked for savings is due to the reality that the average woman is still earning less than the average man. As a result, a female employee saving 10 percent of her salary might have less money stashed away than a male employee who is saving only 8 percent of his paycheck. Add compound interest into the mix, and you have the current gap between the accumulated savings of men and women.

Investing

There have been copious studies performed on the different investment habits of men and women. Most of them conclude that, of the two genders, men tend to be more confident in their financial knowledge and more open to risky investments, while women are the more cautious investors with an eye toward the future. Not surprisingly, studies have found that the average woman’s investment strategy and eventual performance tends to be more stable than the average man’s.

Men also seem to take more of an interest in investing. The Black Rock Survey found that 70 percent of millennial men enjoy managing their investments compared to just 36 percent of millennial women.

There is no right or wrong approach to finances. However, with an open mind and the willingness to learn about our natural strengths and weaknesses, we can all improve our money management skills for building a life of financial wellness and success.

Your Turn: Do the money habits of most of the men and women you know match up with the findings of these studies? Tell us about it in the comments.

Sources:
https://www.investopedia.com/articles/basics/11/myths-and-realities-gender-finance.asp
https://www.investopedia.com/articles/basics/11/myths-and-realities-gender-finance.asp
https://www.moneycrashers.com/men-women-money-sexes-differ-finances/

What Does The Retail Apocalypse Mean For America?

It’s become a familiar and depressing sight: the shuttered doors, the “Going Out of going out of business signBusiness” signs and the empty storefronts. And it’s not just happening to the mom-and-pop shops of our neighborhoods. In fact, dozens of major, national brands we’ve grown up with are disappearing from the country’s retail landscape.

What’s happening to the retail world in America? Is there any way to stop the mass wave of corporate bankruptcy, or will we soon be stuck buying every item we want or need, from groceries to mattresses, on the internet? And most importantly, what does it all mean for the future of the economy?

The retail apocalypse: What’s really happening

The steady vanishing of major retailers across the country has been dubbed the “retail apocalypse” by mainstream media, with the finger of blame pointed squarely at the explosion of online shopping. But a deeper look reveals another story.

Yes, dozens of retailers have filed for bankruptcy since 2010 and more than 12,000 physical stores have closed their doors. But there’s a crucial detail the media has missed. A recent report by the IHL Group finds that, for every retailer that is closing some or all of its stores, 5.20 are opening new locations. In other words, there are more companies opening stores than closing them in every sector of retail, from department stores to mom-and-pop shops. Data from the Census Bureau further supports these findings: In 2018, the overall number of retail stores in the U.S. increased by 3,100.

The report stresses that the retailers declaring bankruptcy only account for a surprisingly small number of brands. To illustrate, at the halfway point of 2019, 16 retailers had filed for bankruptcy, but those 16 were responsible for 73% of the year’s retail store closings across the country.

Among the new stores establishing themselves in place of those who have gone out of business, the trend seems to be moving toward smaller stores that already have a strong online presence. This reflects the evolving needs of today’s consumers: Customers are more likely to visit a brick-and-mortar store for getting a feel for the company’s product, or to try out an expensive item, and then go home and make their actual purchase online.

While the media might have you believing that shopping malls are an endangered species, in truth there are thousands more brick-and-mortar stores in the country today than there were a decade ago.

What kinds of stores are still thriving?

Despite the wave of bankruptcy among chain retailers, there are some segments of retail that are thriving.

One such sector is the bargain department store, including Marshalls, T.J. Maxx and Home Goods, where shoppers enjoy the thrill of finding a steal of a deal they can walk home with that same day. Budget-priced fast-fashion brands, like Old Navy, H&M and Zara’s, are doing surprisingly well, too. Another thriving sector is the warehouse club, like Costco and BJ’s, for similar reasons.

The world of retail may be undergoing a massive shift toward digitization, but finding a bargain never goes out of style.

What do all these closings mean for the economy?

While it may be true that there are more stores opening than closing, this reality does not necessarily reflect well on the country’s level of employment. Retail is one of the largest sources of U.S. employment, accounting for close to 16 million jobs nationwide. As mentioned, most of the stores replacing those going bankrupt are smaller stores, many of which hire fewer than five employees. Consequently, when a major retailer, like Forever 21, announces that it plans to close 178 of its stores by the end of the year, this means thousands of workers will soon be jobless. In fact, the retail sector has lost a whopping 200,000 jobs since January 2017.

The good news, though, is that most of those laid-off workers seem to be finding new jobs before their joblessness can adversely affect the economy. The national unemployment level continues to linger at a half-century low, and consumer spending remains strong. Unfortunately, though, many economists anticipate a recession within the coming year. If their predictions are accurate, consumer spending will likely plunge and accelerate retail bankruptcies and layoffs. In a recession, credit availability tightens and interest rates increase, which can negatively impact the retail sector as well.

“Brick-and-mortar retailers are already in recession,” says Mark Zandi, chief economist for Moody’s Analytics. “They’ve been laying off workers coming up on three years. And this is a time when consumers are out spending aggressively. If the broader economy is in recession, there is going to be blood in the streets.”

While there’s not much you can do to change the tide of the national economy, you can help support your own community by shopping at local retailers and choosing to frequent brick-and-mortar shops, instead of making the internet your first stop for all your shopping needs.

Let’s do what we can to keep our local economy strong.

Your Turn: Do you think the economists are right, and we’re headed toward a recession? Share your thoughts with us in the comments.

How To Dispute An Error On Your Credit Report

Quick-what’s your credit score?woman on phone looking upset

As a financially responsible individual, you should be checking your credit on a regular basis. You can do this by signing up for free credit monitoring on a reputable website like CreditKarma.com, requesting your annual complimentary credit report from AnnualCreditReport.com and reviewing your monthly credit card statements.

If all goes well, your report will hold no surprises and your score will be in excellent shape, or steadily increasing. Sometimes, though, you may find an error in your report. It might be a sharp decline in your score when you know you haven’t changed your spending or bill-paying habits, a large transaction you’re sure you’ve never made or an unfamiliar line of credit. While it can be disconcerting to find a mistake in your credit report, the good news is you can contest errors like these and fix your score.
Mistakes you may find on your credit report

Credit report errors are quite common. In fact, 26% of participants in a study by the Federal Trade Commission found at least one error on their credit reports that brought down their score. A lower score can mean getting hit with higher interest rates on loans, and can prove to be an obstacle when applying for a new line of credit or a large loan.

Most of these errors can be traced back to clerical mistakes, though some are caused by a lack of action on your part, or by criminal activity.

Credit report errors include the following:

  • You’re mistakenly identified as someone with a name similar to yours.
  • A credit account was never included in your report, weakening your perceived credit worthiness.
  • Your loan or credit card payments were applied to the wrong account.
  • A legitimate credit account or debt has been reported and recorded multiple times.
  • Your name is still linked to your ex-partner’s accounts and debts.
  • dentity thieves have used your name and credit file to open accounts and take out loans you knew nothing about – and it’s unlikely they have been making payments on those loans.

To avoid credit report errors, make sure to use your legal name on every line of credit you open, to remove your name from any accounts you are no longer associated with and to have all of your creditors report your open accounts to the major credit bureaus. As mentioned above, it is also crucial that you monitor your score to find mistakes as quickly as possible.

3 steps to disputing an error

If you’ve spotted an error on your credit report, don’t panic. Follow these three steps to dispute the error and fix your credit:

Step 1: File a dispute with each of the major credit bureaus.

You’ll need to inform all three major credit bureaus, Equifax, TransUnion and Experian, about the error. All three bureaus allow you to file disputes online.

In your written dispute, you’ll need to clearly identify each disputed item in your report, explain why you are disputing these items and ask that the errors be deleted or corrected. Include your full contact information, as well as copies of any documents that support your claim. You can also include a copy of your credit report, highlighting the items you are disputing.

To file your dispute online, follow these links for each of the three major credit bureaus: Equifax, TransUnion, Experian.

You can also file your disputes by mail to Equifax and TransUnion; Experian currently accepts online disputes only. If filing by mail, it’s best to send your letter via certified mail with a requested return receipt. It’s also a good idea to keep a copy of your correspondence for your own records.

Mail your Equifax dispute to the following address:
Equifax Information Services LLC
P.O. Box 740256
Atlanta, GA 30348

Mail your TransUnion dispute to the following address:
TransUnion LLC
Consumer Dispute Center
P.O. Box 2000
Chester, PA 19016

Step 2: Contact the creditor

After you’ve contacted each bureau, you can also reach out to the creditor that’s linked to the error in your report. This step isn’t necessary, but it may speed up the correction process.

Most creditors will provide a link or an address for disputes. When filing your dispute, follow the guidelines above and include all relevant information and documentation. Be sure to let the creditor know you’ve also contacted the credit bureaus, as they’ll want to include this information and a copy of your dispute if they report their findings to the bureaus. You can also ask to be copied on all correspondences between the creditor and the bureaus.

Step 3: Follow up in 30 days

Expect to be contacted by the bureaus and the creditor within 30 days after filing your disputes. If all goes well, your dispute will be accepted and your credit will be restored. In many states, you are eligible to receive a complimentary credit report following a registered dispute.

If one of the credit bureaus or a creditor refuses to accept your dispute or does not resolve the error in your favor, you can ask the bureau or creditor to include a copy of your dispute in your file and in all future credit reports. This way, a lender or creditor will be made aware of the alleged error when reviewing your credit. You may be charged a small fee for this service, but it is generally worth the price. If you feel the error is too significant to ignore, consider hiring a lawyer to help you contest the report and fix your credit.

Disputing an error on your credit report is fairly simple. Always monitor your score and be vigilant about correcting errors. The payoff can affect your financial wellness for years to come.  If you need assistance, please contact our HOPE Inside Financial Wellbeing Coach at Destinations Credit Union.

Your Turn: Have you ever filed a dispute for an error found on your credit report? Tell us about it in the comments.

6 Ways To Spot A Payday Loan Scam 

Payday loan scams may seem like old news, but they’re more common than ever. In fact,payday loans sign in 2018, the FTC paid a total of $505 million to more than one million victims of payday loan scams.

In this scam, a caller claiming to represent a collection agency who is acting on behalf of a loan company tells victims they must pay their outstanding balance on a payday loan. They’ll ask victims to confirm identifying details, such as their date of birth or even their Social Security number. They claim they need it as proof that they’ve seen the victim’s loan application and actually do represent the company. Unfortunately, the caller is actually a scammer trying to rip off victims or steal their identity.

In many payday loan scams, victims may have applied for a payday loan but not yet completed the application, or they may have submitted the application but not yet received the funds. In these scenarios, the victim has unknowingly applied for a loan with an illegitimate company which proceeds to sell the victim’s information to a third party. This way, the caller can appear to be an authentic loan collector because they know lots of information about the victim.

If you’ve applied for a payday loan, be on the lookout for these six red flags, any of which should alert you to the fact that you’re being scammed:

You’ve never received a payday loan

While these scams usually target people who have filled out an application for a payday loan, fraudsters often go after victims who haven’t completed one or who have done so but have not yet been granted the loan. Obviously, you can’t be late paying back a loan you never received.

If you haven’t completed your application or you haven’t yet received an answer from the loan company you applied to, you’re talking to a scammer.

The caller demands you pay under threat of arrest

Scammers often dishonestly align themselves with law enforcement agencies to coerce victims into cooperating. A legitimate loan company will never threaten you with immediate arrest.

The caller refuses to divulge the name of his collection agency.

If the caller actually represents a collection agency, they should have no problem identifying this agency by name. If they refuse to do so, you may be looking at a scam.

You can’t find any information about the agency the caller allegedly represents.

The caller is sometimes willing to name the agency, but the company is completely bogus. If you’re suspicious about the call, do a quick Google search to see what the internet has to say about this company. If you can’t find any proof of the company’s existence, such as a web page, phone number or physical address; or the search turns up evidence of previous scams, hang up.

You have not received a validation notice in the mail.

By law, anyone representing a collection agency and attempting to collect on an outstanding debt must send a validation letter to the debtor. This letter will inform the borrower that they can dispute the debt within 30 days. It will also detail the amount of money owed and the party to whom it must be paid.

If you have not received any such letter in the mail before the alleged debt collector calls, you’re probably looking at a scam.

The caller only accepts immediate payment over the phone.

If the caller was reaching out to you on behalf of a legitimate collections agency, they’d be happy to work out a payment plan with you, and provide you with an address to which you can mail your payments. When a “collector” insists that you pay in full over the phone and refuses to furnish an address to which you can mail your payments, you’re likely talking to a scammer who is only interested in getting your financial information and your money.

If you find yourself struggling to survive financially between paychecks, call, click or stop by Destinations Credit Union today. We’ll be happy to help you learn how to keep your finances it optimum health.

Your Turn: Have you ever been targeted by a payday loan scam or a similar con? Share your experience with us in the comments.

SOURCES:
https://www.consumer.ftc.gov/blog/2018/09/505-million-refunds-sent-payday-loan-customers

https://lendedu.com/blog/watch-out-for-payday-loan-collection-scams/
https://www.scam-detector.com/article/payday-loans
https://www.avvo.com/legal-guides/ugc/how-to-spot-a-payday-loan-collection-scam