Tips to Keep Your New Year’s Financial Resolution

It’s the same thing year after year - people around the globe resolve to make better spending and saving decisions. Second only to dieting and getting in shape, saving money is one of the most popular new year's resolutions.

Unfortunately, all new years resolutions have one thing in common; they’re usually deserted within a few weeks.

If you’re struggling to stay on track with your financial goals this year - or need help jumping back on the wagon - we’ve compiled some budgets and tips and tricks for success this year.

Set Realistic Goals

Goals are hardest to reach when they’re set too high. The first step is to identify what you want out of your finances. Are you looking to buy a house this year - or maybe a new car? You shouldn’t be browsing real estate sites and dealerships just yet. Start smaller.

First, check your credit. Not looking so great? You might want to meet with a financial adviser before you make the first moves. How about your savings account – does that need a boost to get to your goals? Identify the steps you need to make, then break down your next moves into smaller, more manageable actions.

Cut the Small Charges

Start by making a list all your monthly expenses: rent or mortgage payments, bills, loans - anything you can expect to pay in a given month. Don’t ignore small monthly charges like a gym membership, online music and/or movie streaming services (most people have multiple nowadays), Amazon Prime membership, Costco Membership, Home Owners Association fees…

Forget a cup of coffee a day, these fees really add up! In fact, Marketwatch.com says 10 percent of millennials spend $200 or more a month on subscription services. Get a good idea of the “small” charges that make a big impact on your budget and get trimming.

Get a Complete Understanding of Your Spending

Take a long, hard look at your spending habits. If you’re spending too much money on eating out, maybe your new year's goals shouldn’t be to save enough to buy a house but to prepare more meals at home. Narrowing your goals to something more concrete will not only give you a better look at your finances, but your savings account will grow without you even realizing!

Get More Options

Too many people give up on their goals because they just aren’t aware of the available options! Refinancing high-interest loans can save you hundreds - if not thousands - in the long run, and make an instant impact on your monthly finances. Take a deep look at any outstanding loans you may have - especially student loans. There are plenty of options such as refinancing and more forgiving payment plans available. Just ask the experts.

Shopping around isn’t just good advice for loans. When’s the last time you shopped around for insurance? These companies are in insanely competitive markets and new customers get great deals.


Need more tips to reach your financial goals this year? Get in touch with the friendly experts at Financial One Credit Union. We’re always happy to help you reach your goals - no matter the time of year.

Saving Money During the Holidays

There’s no doubt that the holidays are the most expensive time of year. Between giving gifts, decorating, and sending cards, the expenses can add up quickly.

Here are a few ways to make the holidays a little less stressful and a lot less of a financial burden.

Plan Ahead

If you haven’t started to consider holiday costs, now is the time to begin! Adding up projected costs is a great place to start. In addition to considering gifts, remember to think of small items such as wrapping paper, holiday cards and postage. At this time of year, small lifestyle changes are amazingly helpful. It’s as simple as packing lunch instead of going out or having a family movie night at home.

Shopping lists aren’t just for the grocery store! Before you go out, make a list of what you need. Don’t get sidetracked by all of the appealing deals. Even though something is on sale, you are still spending money.

Give Homemade Gifts

All homemade gifts don’t have to look homemade! By making a gift, you are also giving your time. Take advantage of something that you’re good at. If you’re a baker, a delicious treat is a perfect option. You can even package them so they look store-bought. If you make jewelry, do that! These homemade items are also perfect for gift exchanges, such as a Secret Santa.

Collect Coupons and Look for Sales

Collecting coupons can take some time and organization, but it’s definitely worth it in the long run. One easy way to do this is with technology. Apps can find the best deals and coupons – and keep you organized.

If you know what you need ahead of time, keep checking for sales. Remember, Black Friday isn’t the only time to shop! Save by paying attention to the regular price of an item. If the original price is what you’re hoping to spend and you find the item on sale, don’t worry about buying more to make up the difference.

Use Cash Back and Rewards

A lot of credit cards offer rewards, and this is the time of year to take advantage! Keep an eye on what promotions your credit card may have for the holiday season. Often, you can get cash or gift cards back for your regular purposes. Also, keep an eye out for store rewards. A lot of stores offer loyalty programs and you may be lucky enough to have money available.

It can take a bit of preparation, but planning your holiday finances will definitely benefit you in the long run. Remember that financial planning doesn’t have to only take place during the holidays. Financial One is there to help you with your finances whenever you need it.

Navigating Life’s Financial Stages

With each life stage, our needs, wants, and dreams change. So do our financial needs.

Where your money goes when you’re 20 probably won’t be the same places as when you’re 50. That’s why planning for each new life stage is a crucial step to having a healthy financial life.

Some years bring major money shifts, however, some goals span many decades, like saving for retirement. Consider these steps as you navigate new stages. And remember, we’re always here to help.

Post-Secondary and Early Career

Whether you’re furthering your education or jumping into the workforce, your 20’s are a critical time in your life. Building a firm financial foundation is key to success down the road.

1. Make a Budget. Know how much money you’re making and where exactly your money is going. Many people spend more than they make in these early years – try to do the opposite.
2. Save for Emergencies. A good rule of thumb is to save 3 to 6 months worth of your necessary expenses in an easily accessible account.
3. Pay Down Debt. Interest builds quickly, so avoid shucking out extra cash by paying down debt on time, or faster if possible.
4. Save for Retirement. If your employer offers a 401(k), 403(b), or another retirement account with a match, save at least the amount required to get that – think of it as free money. Retirement might seem light years away, but the sooner you save, the better off you’ll be.
5. Get Disability Insurance. When you’re young and healthy, you may shrug off disability insurance and think, “I’ll get to it later.” Experts think otherwise. Disability insurance is often extremely affordable and easily accessible. Everyone – no matter his or her age – should have it.
6. Designate Beneficiaries. When you do this, you’re designating who receives your assets in the event of your death. Since you’re probably not married at this stage, it’d most likely be your parents or siblings.

Building a Family and Advancing Your Career

These are exciting times! You may be getting married, starting a family, looking to buy a home, or jumping further into your career. Typically, your income is rising, which means there are a few new things to think about.

1. Negotiate Your Salary. If you’re switching employers, or even sticking with the same one, never be afraid to ask for what you’re worth. If you’re nervous, read this article on how to negotiate your salary.
2. Bring Your Money With You. If you do switch employers, don’t leave your retirement account behind. Either roll it into your account with your new employer, or move it into an IRA you control at a brokerage firm.
3. Find a Financial Planner. Now that you’re making more money and your responsibilities are growing, it’s important to seek advice from a professional. A financial planner can help you see the bigger picture and guide you down a successful path.
4. Update Beneficiaries, Will, Power of Attorney, and Other Important Documents. If you find yourself getting married, you’ll probably want to add your spouse’s name. If you’re single, you may want to update based on life events.
5. Purchase Life Insurance. Picking the right life insurance policy for you, your family, and your unique situation can be complicated. Here’s a good place to start.
6. Purchase a Home. When buying a home, it’s important to evaluate your current financial situation (including debts) and make a decision that won’t put too much stress on your finances.
7. Start Saving for Your Child’s Future. If you have children, or plan to in the future, opening a 529 account for them is a great way to start saving for their education. Set up automatic monthly payments to make saving seamless.

Pre-Retirement

At this point, you’re probably making the most you ever have in your career. You most likely own a home, a car, and have been paying down debt while saving as much as you can. Now’s the time to look ahead to retirement.

1. Max Out Retirement Contributions. Save as much as you can both in your employer-sponsored account and in your own Roth IRA or traditional IRA.
2. Reduce Taxes. Meet with a CPA to maximize your deductions. Consider opening up a Health Savings Account.
3. Pay Off Your Mortgage and Remaining Debt. If you’re still paying off debt from a home, car, or education, now is the time to pay that off.
4. Consider Your Family Members. If you’re going to be the caretaker for your parents, it’s important to consider those expenses when mapping out your own financial priorities. Health care is expensive and can cause familial strain. Talk with your siblings to come up with a plan that works best for each of you.
5. Begin Planning Your Retirement. You’ve spent all those years focused on saving money for retirement that you haven’t stopped to think about what you’ll do once you get there. Meet with your financial planner to discuss how to turn your retirement savings into income.

Retirement

Whether you’re spending your retired years on a porch swing or wrangling grandkids in the backyard, it’s an exciting time that you’ve worked hard to achieve. You’ve come this far, don’t lose track of your finances now!

1. Reevaluate Your Budget. Now is the time to sit down with your spouse and financial planner to decide how much money you’ll need monthly, how to make a steady income, and when to start taking Social Security.
2. Downsize. Buying a smaller home can save you money on utilities, property taxes, and other expenses.
3. Make Changes to Your Will and Estate Plan. By this time in life, plenty has changed. Make sure your legal documents are up to date and reflect your current choices.
4. Consider Moving to a Retirement Community. The benefits go far beyond financial. Moving to a new community brings new friends, new opportunities, and far less stress than owning and caring for your own home.
5. Enjoy! Travel. Take up a new hobby. Whatever new adventure you’d like to take – take it! You’ve earned it!

Save on Road Trips This Summer!

Summer is here, and for many, this means summer vacations are calling. But with airlines’ increasing fees and charges, you may find yourself opting to hit the open road instead of the sky.


Slow down speed racer; if you’re not careful, road trips can get pricey, too! Since we all deserve a break and some fun in the sun, we’re giving you our best tips to pinch every penny and make the most out of your next road trip.

Budget First

Make travel a piece of your monthly budget. Determine how much your ideal trip will cost and how much you can reasonably set aside. Start saving months in advance. This way, when trip time rolls around, you aren’t scrounging through the couch cushions digging for nickels.

Plan, Plan, Plan

Once you’ve got the cash, the real fun begins. Start researching your destination(s) and planning activities and restaurants you’d like to visit while there. Often tickets to parks, events, concerts, etc. are cheaper in advance. A simple Google search of “destination and date and events” will let you know what’s going on.

You’ll also want to set up accommodations before you go. Booking sites like Hotels.com and Booking.com search for the best deals, so you don’t have to. There’s also Airbnb and campsites if you’re going the nontraditional route.

Mapping out your route not only saves you time, but can save you money by helping you avoid tolls, travel the least amount of miles, and drive through more affordable areas. Apps like Waze can help you find the best route and automatically change routes if something pops up – like construction or car accidents.

Guzzle Less Gas

Gas isn’t cheap, with the average price sitting somewhere around $3 per gallon. Use GasBuddy.com to calculate how much you’ll be spending, and make sure this number finds its way into your budget.

Use less fuel and save more money by:

• Packing the vehicle as lightly as possible
• Following the speed limit
• Avoiding aggressive driving
• Filling tires to the correct pressure and making sure tire tread is sufficient
• Renting a fuel-efficient vehicle

Pack Snacks

Driving for hours can really get the tummy rumbling, but constantly stopping at convenience stores to grab food can put a major dent in your wallet. Pack a cooler with the essentials like granola bars, fruit, cheese sticks, crackers, chips, bottled water, and other drinks. Pro tip: buy in bulk and separate into individual bags – or go family style and dig right in.

Packing “picnic lunches” can also save you lots while on the road. Toss some bread, peanut butter, and jelly in the cooler for a quick lunchtime meal that costs you pennies.

Dine In

If dinnertime rolls around and you’re absolutely famished, skip the drive-thru and opt for a mom-and-pop shop instead. These places are often tastier and have better deals than big name restaurants. Plus, they allow you to get a little flavor of the area you’re in.

Check for Coupons

Coupon clipping isn’t just for Moms on TLC. If there are specific stops you’d like to make or attractions you’d like to see, check online for any coupons. Do this simply by typing, “destination and coupon” into Google.

You can also use GroupOn before heading out to get deals on food and fun.

Get Going!

Now all that’s left to do is jump in the car and go! Don’t forget to call your bank and let them know you’ll be on the move. Oh, and don’t forget your chargers either – a good road trip calls for lots of photos!

Factors to Consider Before Buying A New Boat

The open water and sunny days are calling, but what are the actual costs of purchasing a boat, and is it worth it? Part of advising our members on financial decisions is revealing some of the hidden costs you need to be aware of before you take the plunge into a life on the water.

The Purchase Price

Whether you’re shopping used boats or new, sailboats or speed boats, obviously the biggest part of your overall price is the ticket price.

Insurance

Boat insurance generally covers collision, property damage, theft, and/or bodily injury liability. Your cost will vary by state, the type of motor and boat, and whether you’re boating on freshwater or open ocean.

Boat License

Watercraft licenses are required in most states for boats over a certain length. In Minnesota, boat dealers will help you apply for title and registration, and are good for three years.

Trailer

If you plan on visiting other lakes or taking your boat on the move, you’ll need a trailer, not to mention a vehicle that can tow something as heavy as a boat.

Storage in Winter

With many local options for winter rack storage, these storage facilities make sure to prep your boat, wrap it, and store it for a monthly or annual fee. Some boat owners choose to store their boats on their own property over the winter, which still requires winterizing and boat wrap.

Dock and/or Marina Space

Now that you have your boat, where will you dock it? You may be purchasing a dock for your own property or renting marina or dock space on a nearby lake, both additional costs to take into consideration.

Maintenance

Last, don’t forget the costs for cleaning, repairs, and maintenance to the boat, sail, or motor.


For additional advice on making a boat purchase, or questions about recreational vehicle loans, contact us at Financial One.

Navigating Home Loan Options and Rates

With the Spring Home buying season around the corner, there may be some confusion over the different types of home loans available for those making the big purchase.

Financial One Credit Union is here to help – both with providing answers and with financing your new home.

Types of Home Loans: 

1. Adjustable Rate Mortgage

ARMs give you a fixed interest rate for a certain number of years (the “adjustment period”) at a very reasonable rate. Following that period, your mortgage then becomes what is called a variable rate mortgage, where the rate adjusts on an annual basis based on market conditions, usually +/-1%.

2. Fixed Rate Mortgage

With these loans, the interest rate is fixed for the term of the loan – usually for 15 or 30-year terms. Fixed rate mortgages are more stable over the long-term even though you may see a higher interest rate than you’d get at the beginning adjustment period of an ARM.

3. Home Equity Loans

These loans take advantage of the equity you have in your home and are available if you owe less on your home than it is worth. Home Equity loans give you large amounts of funds to use for a variety of reasons and are available through Financial One Credit Union as lump sum loans (up to 100% loan to value) or as a Home Equity Line of Credit (up to 80% loan to value variable rate).

Interest Rates

Interest rates fluctuate daily based on changes in financial markets. Your individual interest rate will be determined based on your credit score, your income vs. debt ratio, down payment amount, the amount being borrowed, and the term of the loan. If you have any questions about how interest rates are calculated or why they fluctuate, please don’t hesitate to contact us.

Rates at Credit Unions are Often Better than Banks

According to Investopedia, Credit Unions are able to turn income into savings for their members. “Since profits to stockholders aren't a part of the company vision, credit unions are free to pass surplus money on to members.” In addition, Credit Unions don’t need to answer to stockholders; we are member-owned and are concerned with benefiting members over anything else.

Apply now for a Home Mortgage Loan from Financial One Credit Union, or view our current rates here.

How to Set a Personal Budget for 2018

In a season known for indulging and overspending, the holidays can be the last time you want to think about a budget.

However, the start of a new year is the perfect time to revamp the way you think about your money. It’s a way to set yourself up for 2018 to make your budget work for you, instead of working for your budget.

With that attitude in mind, take these three steps as you begin budgeting for 2018:

1. Start with the Basics

You might feel tempted to go way into detail when you first set out to budget, but that’s not necessary. Divide your budget into simple categories in a program such as Microsoft Excel so you’ll easily be able to make edits and be realistic with the amounts you set for each category. Don’t be too hard on yourself.

Think about how much you’re already spending in each area and visualize what you could cut back on. Draw your budget as such.

Be honest about the best way to keep your budget. If you like math, it could be pen and paper. If you’d like to be more hands-off, try a budgeting program such as Mint, which categorizes your purchases as you make them.

2. Save for the Worst

Build an emergency fund into your budget. This type of savings account will give you a financial buffer in the case that illness or injury, hospital bills, or other times of need make money tight. Putting money into the fund can be as easy as the change from your lunch, cutting unnecessary expenses, or saving your tax return.

Build the fund with the requirement that it be used strictly for emergencies, and not as general savings. Don’t use the fund for holidays or planned expenses. This way, when the unexpected happens, your money will be ready.

3. Don’t be Afraid to Make Changes

Your budget shouldn’t be set in stone. As you start spending in 2018, see where your estimates and actual spending don’t match up and take a look at why that is.

If money is tight, it’s tempting to underestimate costs as you set your budget. Don’t set yourself up for failure. Allow room for fun and an occasional splurge. Get too restrictive too soon, and it will be harder to follow the budget as the year goes on.

If things still don’t add up, think about adding to your income instead of cutting from your expenses. An extra part-time job, some freelance work or selling something you’re not using can free up some space in the budget.


No matter your budgeting goal for 2018, Financial One Credit Union is here to help.