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.
Give a Financial Gift
Financial Gifts Can Improve Well-Being
Yes, you can grab some gift cards as a last minute gift choice. But how about something different? Give a financial gift.
If you really want to give a meaningful holiday gift this year, think beyond traditional items like clothing and gift cards. A recent survey conducted for Charles Schwab shows that more than half (53%) of those surveyed say cash to help pay off credit card bills would be their top choice as an unexpected holiday gift.
A holiday gift to pay down debt can help someone save on interest payments as well as help the recipient feel more financially secure as he or she grapples with debt.
Other financial gifts to consider:
• Piggy bank—This simple gift can go a long way toward educating even the youngest children about money. They quickly learn the concept of putting coins in the bank, then using the coins to make a purchase later. Buy a cute bank and fill it with coins or a few dollars. Some banks electronically add up coins each time a new one is deposited—seeing the amount grow can be motivating to kids. Another idea: Buy a small three-drawer container and set up a drawer each for saving, spending, and sharing.
• Sessions with a financial adviser—Arranging for a sit-down with a financial planner, if only for one or two sessions, can help someone learn personal finance basics and give him or her the groundwork for starting to invest. Contact Mid Oregon Credit Union for a referral.
• Cash toward a Roth IRA (individual retirement account)—“In addition to using cash to pay off credit card debt, another smart way to use holiday gift money is to encourage a working recipient to put the money into a Roth IRA,” says Michelle Dosher, in the Credit Union National Association’s consumer education and market research department. “Roth IRAs can be really beneficial, especially when people start them at a young age.”
• Electronic gadgets—Gadgets like tablets and smartphones are popular gifts, but you can add a financially savvy twist with personal finance apps, many of which are free or inexpensive. “If you’re going to give someone a gadget, also give suggestions of financial apps that could help teach money management skills, and encourage recipients to use your Credit Union’s mobile banking tools,” Dosher adds. This is a gift that teens and tweens can appreciate as well.
• Books—Help family members and friends learn to manage money by giving them a book about the topic. One idea is “Money Rules: The Simple Path to Lifelong Security,” by Jean Chatzky. It’s an easy read, broken up into sections about making and saving money, spending wisely, and investing.
• A financial jumpstart—Maybe you know a new grad or someone just getting back on his or her feet. You could help by offering your home as a place to stay for a month or two or by helping to pay a security deposit or first month’s rent. This would be a great gift for parents to give young adult children as they learn financial independence.
• Mid Oregon Credit Union membership—Let family members know that because you’re a credit union member they can be members. Tell them about the benefits of credit union membership and about the ease of using credit union services. Mid Oregon Membership is open to those who live, work, worship or go to school in Deschutes, Jefferson, Crook, Wheeler, Lake & North Klamath Counties, and to family of current members (See details at MidOregon.com).
The Importance of Having a Checking Account
About 14 million adults in the U.S. do not have an account with a credit union or bank. Whether this is by choice or because they don’t think they qualify to open an account, they end up missing out on many financial services that make life easier. Having a checking account can make a big difference.
For instance, instead of using a credit union to deposit their paychecks and getting only the cash they need, they use check-cashing stores like Check into Cash or other retailers. These operate by charging a fee of 1% to 6% of the check amount.
In addition, people without a credit union account don’t have a safe place to keep their funds. They are less likely to qualify for loans, and can’t earn interest on the money they save.
Checking Account Conveniences
There are many other conveniences to having a checking account:
• You can get a debit card or use a mobile wallet
• Using checks to pay your bills.
• You will be able to pay bills online, using electronic Bill Pay
• If your employer offers direct deposit, you can have your paychecks automatically deposited into your account. This means you will get your money faster. So you won’t need to go to a branch or ATM to make the deposit.
• Get cash for just a portion of your paycheck and leave the rest in your account. This means you won’t have to carry large amounts of cash on you.
• Your money will be safe in your account from theft, fire, or loss. And it’s also insured, so if something should happen to the credit union, your money is covered up to $250,000.
Opening a checking account is very easy. You’ll need a Social Security number [or ITIN], two forms of identification, and $50 for the first deposit.
Simply Free Checking
Many banks charge checking account fees, some as high as $9 a month. But at Mid Oregon Credit Union, you can get a Simply Free Checking account. Enjoy no monthly maintenance fees and no minimum balance requirements. And when you become a member, you become a co-owner of the credit union. Among the perks are lower loan rates and higher savings rates than you would get at banks or other financial institutions.
To get started, see the available checking accounts at www.midoregon.com, where you can find out the best checking account for you using our online checking chooser. Or, contact us by calling (541) 382-1795, emailing to info@midoregon.com or meeting with a Account Representative at a convenient Central Oregon branch office.
Using Credit Wisely
Time can clean up a bad credit record, but it takes years, and during that time, you might suffer further misfortunes. One helpful thing to do is to start using credit actively, and using credit wisely. You can do this even if your credit is bad. It works in much the same manner as getting credit for the first time.
Don’t Make the Same Mistakes
As you are rebuilding your credit, you will find it necessary to avoid getting into the traps that caused it to fall so badly before. This takes discipline, vigilance, the willingness to delay gratification and stop indulging, and patience. That is why you should look into making a budget, cutting back your expenses, taking a second job, or other tough measures.
Don’t avoid credit cards
Having bad credit may tempt you to swear off the credit cards, but if you want to improve your credit, you must eventually use credit. One option is to get a secured credit card, which requires you to put down a deposit that can be used as collateral.
When applying for new credit cards, too many applications can lower your credit score. Apply for only a few instead.
Don’t do anything to harm your credit score
Your credit score is made of 35% payment history, 30% amount owed, 15% length of your credit history, 10% new credit, and 10% type of credit used. To keep your score good:
- Pay your bills on time, fully if possible. Consider setting up automatic payment deductions from a credit union or bank account to pay your bills; this can help you avoid late fees and default interest rates.
- If you can’t make your payment on time, call up the card company and explain your situation. Ask to have the late fee waived. Though not guaranteed to work, card companies sometimes will waive them for you. They can also extend your due date for you and forego reporting the late payment to the credit bureaus.
- Don’t max out your cards. Using about a third of your credit limit is optimal.
- Don’t apply for a lot of new credit cards. Keep only a few.
- Use your card or cards regularly so that you can build up a history. Charge only as much as you can pay off (set aside the cash for it ahead of time), and do this every month.
Closing a card
If you have more cards than you need, consider closing some of them. This will reduce your total available credit limit, which can work in your favor. Too much credit can make you appear risky. However, closing a card can negatively impact your credit score. Here are some things to keep in mind:
- Closing a card that still has a balance can cause it to appear as maxed out on your credit report, since there is no longer a credit limit on it.
- Closing your oldest card will shorten your credit history and therefore make you look risky.
- Closing ALL of your cards can prevent you from using credit in the first place, which does not help your credit score.
- Closing only those cards that have the least favorable terms (fees, interest rates, perks) may be in your best interest.
- After you have closed a card (do it in writing), check your credit report a few months later to make sure that the card is indeed closed.
Help From Mid Oregon
Mid Oregon’s Banking App includes Credit Savvy, which provides your credit score and information which would be on your credit report. Credit Savvy also breaks down some factors which influence your score, with recommendations on actions to improve.
Talk to a Mid Oregon loan officer to get more personalized feedback on improving your credit. They can help guide you in using credit wisely. As you would be a member, the credit union is more successful when you are, too. Visit a Central Oregon branch, email us to info@midoregon.com, or call us at (541) 382-1795. Find out how using credit wisely will improve your financial well being.