The Bottom Line
Small business is important to Central Oregon, and to Mid Oregon. Find tips and resources for business, and information about Mid Oregon’s commercial services and business members.
Pros and Cons of College Payment Strategies- Part 1
College Payment Decisions
Are you or a family member on the cusp of making college attendance decisions? Or have you already decided? So how will college expenses, tuition, room and board, books and incidentals, living expenses…how will they be paid? Do your have any college payment strategies?
In Central Oregon we have great options where students can live at home while they attend Central Oregon Community College or OSU Cascades. That can save a significant amount of money. But that still leaves many school costs to be funded. This is the first in a series of articles designed to help students and their parents make the best choices on how to pay for college.
Borrowing Can Be Expensive
College students who borrow for school graduate with a debt load equivalent to a new-car purchase or a down payment on a house, averaging $25,000.
Some borrowing might be inevitable. To keep it to a minimum, explore the features of other college payment strategies.
529 savings plans
Pros: Your savings grow tax-free and earnings escape federal tax if you use withdrawals for qualified college expenses. Your state might give you a tax break for contributions. You may invest in other states’ 529 plans.
Cons: If you use the money for noncollege expenses you’ll have to pay taxes and a penalty on earnings. A state-appointed firm manages the account you so lose direct control.
Prepaid tuition plans
Pros: You can lock in tuition at in-state public colleges years in advance. The tax benefits are the same as for a 529 savings plan. If your student goes to an out-of-state or private school instead, you can transfer the value of the account or get a refund.
Cons: Not all states participate. If you use the money for noncollege expenses you’ll have to pay taxes and a penalty on earnings.
Coverdell education savings accounts
Pros: The tax benefits are the same as for a 529 savings plan, and Coverdell’s expand the definition of “qualified” to include tuition at private elementary schools and high schools.
Cons: Your contributions can’t exceed $2,000 a year and the beneficiary must be younger than 18; contributions are limited by your modified adjusted gross income.
Roth IRAs
Pros: The money in a Roth grows tax-free. Withdrawals are not limited to qualified education expenses. You can avoid taxes on withdrawals as long as they don’t exceed your contributions. You can avoid a 10% early withdrawal penalty on earnings if you use the money for educational expenses.
Cons: If you are younger than age 59 ½, you will owe tax on any earnings you withdraw. If you are 59 ½ or older you must have held the account for five years to avoid taxes on earnings you withdraw. The ability to contribute to a Roth IRA is governed by modified adjusted gross income limits.
Read more suggestions in Pros and Cons of College Payment Strategies-Part 2
How to Cut the Cost of Driving
Gas Prices Are Only One Factor
Gasoline prices are rising again, but fuel is just one factor in the high cost of driving an auto. The average cost of driving a sedan 15,000 miles a year will cost you $8,698, or 58 cents per mile. You’ll spend 70.8 cents a mile, or $10,624 a year, to put 15,000 miles on an SUV with four-wheel-drive. These big numbers drive us to learn how to cut the cost of driving.
Many factors feed the cost of driving: financing, depreciation, maintenance, insurance, and driving habits.
Financing: Credit unions often offer the best rates on loans, but you also should compare the loan term, fees, and prepayment penalties. If the dealer offers a rebate, you may save more money by taking the rebate and financing at Mid Oregon Credit Union than taking the low-rate loan.
Depreciation: Depreciation is usually the largest part of the cost of driving: AAA estimates the average annual depreciation on a medium sedan driven 15,000 miles per year at $3,654. Kelley Blue Book says that after five years, the average car is worth 35% of its sticker price. But some cars, especially Honda and Toyota, have much lower depreciation. Ignoring the current value of a used car can put you “upside-down” if you trade the car and pay off the loan: You owe more on the car than it’s worth.
Maintenance and repair: AAA estimated the maintenance costs of sedans at 58.9 cents per mile in 2017. Maintenance costs varied widely by vehicle type but, on average, were up slightly from 2015.
Insurance: AAA estimated insurance costs for the average sedan at $1,115 per year in 2015, based on a low-risk driver with a clean driving record. Insurance for drivers who are male, younger than age 25, poor students, or have a record of moving violations and/or accidents is more expensive. Raising the deductible and reducing the maximum coverage can lower premiums but will increase your risk.
Driving habits:
* Drive defensively. Try to stay off the road late at night when most accidents occur.
* Keep tires inflated to improve mileage and cut the chance of a blowout.
* Drive mild, not wild: Accelerating slowly and coasting up to stoplights can improve gas mileage up to 30%.
* Use the cruise control for highway driving to save 4% to 14% in gas.
* Drive less to save on gas, oil, maintenance, and deprecation. Think about carpooling, taking public transit, biking, or walking.
Mid Oregon Credit Union can help with all your auto needs. Contact us today at (541) 382-1795 or beheard@midoregon.com.
Mid Oregon Credit Union Achieves $200 Million Asset Milestone
Bill Anderson, President/CEO of Mid Oregon Credit Union, announced assets exceeded $200 million for the first time since establishment in 1957. Previous milestones of $100 million in deposits (2009) and $100 million in loans (2011) show a consistent growth trend. Mid Oregon Credit Union achieves $200 Million asset milestone threshold in Central Oregon.
“This major milestone reflects the strength and stability of our financial institution as well our continued growth,” explained Anderson. “We work hard to build relationships and trust with our members and our community. Our continued commitment to Central Oregon sets us apart from other financial institutions. People are interested in Mid Oregon Credit Union as a preferred choice for financial services.”
“We are seeing positive member growth in deposits, lending and checking accounts” said Kyle Frick, VP Marketing. “Products and services like mobile deposit, debit card security app (CardNav), and Home Energy Trust efficiency loans are helping members with more convenient access to their accounts, saving time and money.”
Deposits are insured to at least $250,000 through NCUA (National Credit Union Administration) and NCUSIF (National Credit Union Share Insurance Fund), the equivalent of FDIC insurance.
Mid Oregon Credit Union is a full-service, member-owned, financial cooperative that has served Central Oregonians for 58 years. With over 24,000 members in Deschutes, Jefferson and Crook counties, Mid Oregon Credit Union is helping meet member needs and achieve financial dreams. For more information about Mid Oregon Credit Union, their services and branch locations in Bend, Redmond, Prineville, Madras and La Pine Lending Center, please visit www.midoregon.com or call 541-382-1795.