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6 Ways to Get Financially Fit in 2020
About half of Americans make New Year’s resolutions each January, but only about 20% of people keep them. Getting into shape and achieving financial goals are among the most popular resolutions. (Statista.com).
While we can’t help you reach your ideal weight, we can share 6 ways to help you become financially fit in 2020:
1. Put your money on autopilot—Set up direct deposit, authorize electronic payments, and automate routine savings. Streamlining your finances with online tools not only saves time, it helps you avoid late fees and overdraft fees and makes saving easier.
2. Create a spending plan—Only about 40% of adults have a budget, according to the National Foundation for Credit Counseling. Use a free online budgeting tool, like Mint or PocketGuard, to keep track of expenses and compare it to your monthly take-home pay. See where you’re spending too much and make any necessary adjustments.
3. Build an emergency fund—Not having an emergency fund is like driving without wearing a seatbelt; it’s a risk that could ruin the rest of your life. More than half of Americans don’t have a rainy-day fund and 40% don’t even have $400 in cash saved for emergencies. You can start small, $10 to $20 per paycheck, but work to save 3 to 8 months of income. To make it easier, setup an automatic transfer from your checking to your savings account.
4. Increase your credit score—Pay all bills on time, every time; pay more than the minimum; don’t use more than 30% of your credit; avoid opening many new accounts in a short time period, and; keep the oldest existing credit (the longer a credit history, the better). Also, if you have parking tickets or library fines, pay them off. Debts are reported to a credit reporting agency and they can knock down your credit score.
5. Request your credit report—You want to make sure there are no errors and no one is using your credit unlawfully. Request one free credit report a year from each of the three major credit reporting bureaus by visiting annualcreditreport.com.
6. Beef up retirement funds—Make regular contributions to a retirement savings plan such as a 401(k) or IRA. If your company offers a 401(k) plan, contribute at least enough to meet the company match. If you don’t, it’s like leaving free money on the table. Also consider opening an IRA at your credit union.
We can help you with any or all of these ways to become financial fit in 2020. Come in to one of our seven Central Oregon branches to speak to one of our team. And start the new year off right!
Holiday Break Financial Opportunity for Parents!
Don’t Miss the Chance to Teach Your Children
Soon our kids will be out of school for a couple of weeks. We should be looking forward to Christmas, winter fun and educating our kids. Yes, winter vacation is a great time to teach your children about money. Don’t miss this holiday break financial opportunity for parents
But why is this a good time? Actually, any time is a good time. But these two weeks that kids have off have some additional built-in advantages.
Spend Time Together
Parents often have vacation or additional time off around Christmas and New Years. With our busy lives, being at home at the same time as our kids doesn’t happen enough. Use this time wisely.
Giving Your Child a Teachable Gift
Have you thought about a gift that can help teach your child about money, or managing their finances? From stocking-stuffers to gifts of cash, there are almost endless gift ideas that provide openings to share about financial management or money.
Take Them Shopping
Bringing them with you to purchase gifts, either for your family or help them find gifts for their friends and relatives. These can be teachable moments. Making their money go further, staying within their “budget” and incorporating the value of comparison shopping can all be building blocks for financial learning.
If you are looking for gifts to give your kids, here are some examples you might consider. Keep in mind the possibilities are almost endless.
Under 5 Years Old
- Give them money, or play money. Have young children sort different types of money into piles by color and size.
- Toys tied into business, like a play store. Maybe you can find a toy cash register, and help them learn about the value of money and how commerce works.
- A Piggy Bank can be fun for them to receive and look at. You can also give them some money to start their savings.
- A Children’s book about money. There are so many good books you can find. Many popular book series have money teaching books, like The Cat In The Hat, The Berenstain Bears, Curious George, and more.
Pre-Teens
- How about old fashioned board games? These used to be the staple of great family times, especially when doing things outside was more difficult. Board games are still around today, and the choices to teach about money are extensive. Cashflow for Kids, Pay Day, and even the old standby Monopoly are good choices.
- What about getting them the gift of a savings account? Give them a check as a starter. Then take them down to your local credit union (like Mid Oregon), and open an account. This can be a great start to a solid financial life. Make it their account, with you as a joint owner. Of course, you don’t need to wait until they are in elementary school to open their savings. Each year you can bring them in with the money gifts they received to make their deposit.
- With those same money gifts, you can teach about spending, saving and giving at the same time. Urge them to save a portion of what they receive, and set aside some for what they want to buy. But what most parents forget is you can teach them about giving, too. Being generous or charitable is a part of healthy money management, too!
Teenagers
- Teach kids money management with a debit card. If you’ve already been teaching smart money management skills and your son or daughter has shown financial responsibility, a debit card/checking account from Mid Oregon Credit Union can be a great next step to teach kids money management.
Bring them to the credit union to open their checking account, and you can maintain some teaching influence (and control) with our Mid Oregon tool of CardNavSM by CO-OP. It gives real-time security and control over Mid Oregon debit cards through smartphones or tablets! It can use GPS to restrict transactions to businesses within a designated area. You can limit debit card use to specific merchant or purchase types. You can receive near real-time, in-app transaction alerts. and receive alerts when you’re getting close to any personal spending limits set. Visit MidOregon.com for information on downloading this free app.
- Games work for teenagers too. Monopoly is good for older kids (and adults), but there are many more.
- Books for adults can become good reading for older kids. The Rich Dad, Poor Dad series has a book for teens, and Dave Ramsey has many good materials for youth. These are just the tip of the iceberg.
- If you child has a smartphone or tablet, there are many apps which provide teaching on money. Do a search and you will find many app lists to help kids learn about money. Get a good recommendation and be sure you agree with how the apps deal with their subject.
This Is The Time
As you can see, there are many choices to help you teach your kids about money management. This is an ideal time to start of continue building that learning. Don’t hesitate to come into Mid Oregon to ask about resources, and help your child get started on a life of sound financial management!
Manage Your Credit Cards Better
U.S. consumers are once again increasing their collective credit card debt, which now exceeds $1 trillion. The Credit Card Accountability, Responsibility and Disclosure (CARD) Act protections, which went into effect in February 2009, require card issuers to disclose rates and other information more clearly. This should make it easier for consumers to monitor what they owe. But, regulations can’t prevent people from making poor debt management habits. Learn how to better manage your credit cards.
Keep On Top of Your Cards
Here’s some advice for controlling credit card use:
• Actively manage your account. Open and examine your credit card statements promptly. Look for unauthorized use, of course, but also look for announcements from the issuer. Under the new rules, you must have 45 days’ notice of a change in your card’s terms, such as an interest rate increase. If you choose to “opt out” of the change, you no longer will be able to add new charges to your card, and will want time to get a replacement while you pay off the old balance.
Maintain a Good Credit Score
• Keep your credit score healthy. This number between 300 and 850 is a measure of your trustworthiness as a borrower. The higher your score, the easier it is to get a loan and, often, the more favorable the interest rate. The most important ways to maintain and improve your credit score is by paying all your bills on time and not taking on excessive debt.
Manage Your Balance to Limit Ratio
• Watch your card balance-to-limit ratio. It’s OK to occasionally “max out” your credit card for important purchases, as long as you can pay it off in a few months. But over the long term, try to keep your total credit card debt to a reasonable 10% to 20% of your total credit limit. If the ratio gets much above 20%, and you can handle the payments, ask for a higher limit on your current card or get another one. Don’t add new cards too often, though, and don’t close several unneeded accounts in a short period—either move can lower your credit score.
Understand Your Cards
• Understand the overlimit option. The CARD Act allows you to choose what you want your card issuer to do when you try to go over your card’s credit limit. If you “opt in,” you can go over the limit for a fee. If you “opt out,” your attempt to go over the limit will be declined.
If you don’t already have a Mid Oregon Credit Union Visa credit card, now’s the time to get one. Contact us through email, phone (541-382-1795) or in the branch. You can also apply for a Mid Oregon Visa online.