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.
Roth IRAs Good for Your Savings Plan
Good things come to those who wait—for a tax break***. Although you fund a Roth individual retirement arrangement (IRA) with after-tax dollars, the money you distribute is completely tax-free as long as it meets certain requirements. And that means a really good thing—you may never pay a cent of tax on your earnings. That might make Roth IRAs good for your savings plan.
*** The IRS Says You Have Until July 15, 2020 To Make 2019 IRA Or HSA Contributions.
Tax Advantage
The Roth IRA is one of the few savings vehicles that gives you this advantage, and it’s a big one. Suppose you put $6,000 a year (the maximum contribution limit for 2019 and 2020) into a Roth IRA for 25 years at a 1% return. You would end up with $142,061—$17,063 of which would be tax-free earnings! It’s the magic of tax-deferred compounding.
You’ve seen how time plays a key role in maximizing Roth IRA potential. That’s exactly what makes the Roth so appealing if you’re just starting out with a savings plan, according to Dennis Zuehlke, compliance manager for Ascensus in Middleton, Wisconsin.
“The younger you are, the longer your money can grow before you take it out,” Zuehlke says.
Saver’s Tax Credit
Zuehlke adds that young savers are likely candidates for the Saver’s Tax Credit.
This nonrefundable tax credit can total up to 50% of the first $2,000 you put into a Roth IRA each year. To qualify, you must be at least age 18 and you cannot be a full-time student or a dependent on someone else’s tax return. And, there are income limits. For example, a single person with 2019 adjusted gross income up to $19,500 would receive a tax credit equal to 50% of the first $2,000 of IRA contributions, and a reduced credit is available up to $32,500.
Roth + Saver’s Tax Credit = Difference
“Combine the Saver’s Tax Credit with all the other tax savings of a Roth IRA and it can really make a difference,” Zuehlke says.
Ask the professionals at Mid Oregon Credit Union and Mid Oregon Wealth Management for information about IRAs. We’d be happy to help you set up a retirement plan for your future.
Understand Financial Aid Definitions
Understand Financial Aid Definitions- a Glossary
The terminology used in college financial aid award letters can be confusing. Here’s a quick guide to some frequently used terms, some financial aid definitions:
Cost of attendance: The total price of going to a particular college. It includes tuition, fees, room, board, books, supplies, meal plan, and other living expenses, such as transportation.
FAFSA: The Free Application for Federal Student Aid tells you, based on your family’s income and expenses, what you’re expected to pay out of pocket for your son or daughter’s first year of college.
EFC: Expected Family Contribution, or the amount you and your student are expected to pay out of pocket for his or her first year of college.
Grant: An amount awarded for financial aid, either from the federal government (federal grant) or from a college (institutional grant) to attend that college. A grant is “free money,” meaning you don’t have to pay it back.
Institutional scholarship: Free money you don’t have to pay back that a college offers you to attend that school for the coming year. These scholarships can be merit-based (awarded because of your accomplishments in academics, a sport, music, or another area) or need-based (to supplement your EFC).
Private scholarship: A scholarship you apply for from an outside organization.
Pell Grant: Need-based free money from the federal government.
Stafford Loan: An amount of money a college will allow you to borrow from the federal government at an interest rate the government sets. These can be subsidized (no interest accrues—is added to the balance—while the student is in college) or unsubsidized (interest accrues while the student is in college).
Parent PLUS Loan: An amount of money a college will allow parents to borrow from the federal government, at an interest rate the government sets, for their son’s or daughter’s coming year of college.
Private loan: An amount of money parents or students can borrow from a financial institution—if they’re credit-worthy—for the student’s coming year of college. The financial institution sets the interest rate. Unlike federal loans, you have to make payments on private loans while the student is in college.
Work study: An amount of money a college will pay a student for working at a qualifying job at that college. The student must find and apply for his or her own job.
Still Focused On Serving You
We are still here to help you.
You and your family may be worried about the impact on your lives of the coronavirus disease (COVID-19), but the leadership at Mid Oregon Credit Union want you to know we are here for you as we always have been. Your deposits are safe and insured. We’re not going anywhere, because at its core, our credit union is not a building or a business, it’s people unified for a common goal.
Here is an audio message from our CEO, Bill Anderson
Your accounts are safe and insured–and safer than cash
There are a lot of things to worry about these days, but the safety of your money in your credit union isn’t one of them. Your money is safe, and your accounts are fully insured by the National Credit Union Share Insurance Fund (NCUSIF) up to $250,000, with additional coverage provided for different ownership interest and account types. There is no risk to keeping money in your account, but there are countless risks to holding cash. More and more, local merchants are turning to electronic payments, including debit cards, to keep their staff protected from the risks of handling cash.
COVID-19 has cancelled, postponed, and slowed down much of American life, but the nation’s financial system operations are still strong. You can meet nearly all of your financial needs without leaving your home.
If you’ve been impacted by this pandemic, our staff is dedicated to working with and helping you through these uncertain times. Now, more than ever, we are here to support our members. Whether it’s waiving fees on skip-a-payment requests, an emergency loan, or posting your mobile deposits more frequently throughout the day, we are working hard to meet your financial needs. Find information on the steps we’re taking at our COVID-19 Information page.
Use caution and minimize social interaction
Health professionals say if you must leave your house, use an abundance of caution and observe the social distancing rules put in place by government officials. If you need to visit us in person, we encourage you to make an appointment, or our ATMs and drive-through lanes are a great option to access your cash. Of course, our digital options are always available 24 hours a day for transfers, mobile deposits, and bill payment. And if you need to speak with someone, you’re welcome to give us a call at 541-382-1795.
Please read Mid Oregon’s Social Distancing Policy Notice.
We’re here if you need any additional assistance
You can visit our COVID-19 Information Page for information on measures we’re taking to ensure your safety and the safety of our team. If you want to learn more about COVID-19, visit the CDC’s resource center or the Oregon State Health Authority COVID-19 Updates page. Please take care of yourself and those around you and do not hesitate to contact us for any assistance.