Tag Archives: financial education

Home Ownership : 5 Questions to Guide Your Decision

This article was developed as part of USAgencies Credit Union’s partnership with EverFi, Inc.

As winter melts into spring, you’ll likely start to see “For-Sale” signs popping up in your neighborhood.

Buying a home can be an exciting milestone in your life, and it’s important to educate yourself on the financial implications of home ownership before you make an offer. Whether you’re a first-time home buyer or a current owner looking to sell or refinance, there are a few key questions that should help guide your decision:

5 Questions About Home ownership

1.What are the pros and cons of owning vs. renting?

Owning a home is a long-term commitment. Recent studies show that the average buyer expects to live in their new home for 13 years before selling. While home ownership allows you to build equity and take advantage of tax benefits, owning also comes with risks.

2.Am I ready for the responsibilities of home ownership?

While property is generally considered an appreciating asset, home values are tied to economic conditions. Having your financial house in order is an important first step to buying a house! Are you confident in your ability to pay your bills on time? Are you able to budget for unanticipated costs?

3.How much home can I afford?

Determining how much home you can afford goes beyond the list price of a property. Other factors that will affect your monthly payment include interest rates, taxes, insurance, income, debt, and future monthly expenses – to name just a few. While there are numerous “affordability” calculators out there, it’s important to first understand the whole picture.

4.How will lenders evaluate my mortgage readiness & make loan decisions?

Are you familiar with the “Four C’s of Loan Credit?” – Capacity to pay back the loan, Capital, Collateral and Credit. Lenders evaluate these different factors to determine your eligibility and the terms of a mortgage loan.

5.How will my credit score impact my ability to buy?

Your credit score and the information in your credit report are key factors in whether or not you’ll be approved for a mortgage and at what interest rate. When was the last time you checked your credit?

No matter what stage of home ownership you are exploring, expanding your knowledge about the key financial questions to ask when buying a home will help you make a long-term decision that benefits you!


Have questions about Buying or Refinancing, or ready to get your application started? Connect with us at 503.275.0300 Option 2 or visit our website. 

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USAgencies Credit Union
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Teach Your Child to Save During Youth Savings Month

April is National Credit Union Youth Month, and it’s a great time for credit unions, like USAgencies, to focus on children in communities, and talk about some of the ways you can help set your child up for a financially successful future.

Here are some age appropriate suggestions for teaching children money management:

Ages 3 to 6 Years

Before children can handle money, they must first understand simple numbers. and know a penny from a nickel and a dime. Introduce coins by letting them handle money when buying small items.

At 5 or 6, give your child a dime and explain it will buy a piece of candy, or a toy, but not both. Money management involves choices and even at this age, when children spend, they need freedom of choice.

Ages 7 to 12 Years

When children begin to earn an allowance, help them use it wisely by putting part of it in a different envelopes or other containers for different purposes. Make sure sure to include one for savings.

Encourage your child to save by showing them some things that cost more than their allowance, and that they will have to save until they have enough.

Ages 13 to 18 Years

Teens experience managing money and making more decisions. Additional money beyond the normal allowance should not be given out generously. If you give them more, they may not learn the importance of planning, wise spending, and setting limits.

Share with your teenager the responsibility for spending part of the family’s budget. Have them prepare meals or do the weekly shopping; take them with you so they can learn how. Family budgeting will teach your teenager about living costs and values.


Ready to start a savings account for your child, or have some questions? We would love to help. USAgencies Credit Union offers many beneficial youth savings options. Give us a call at 503.275.0300 Option 2, or email at info@usacu.org.

 

Letter from the CEO: Retirement Savings

Did you know that nearly half of all American families have no retirement savings? That is not a recipe for retirement happiness.  Saving for retirement is the most important thing you can do to ensure a financial future full of exciting possibilities.  But, it takes effort and a long-term commitment to saving regularly to get you where you want to be.  It’s estimated that you will need a retirement income of 70% or more of your earning income to maintain your current lifestyle throughout your retirement years.  Are you on track?

There are several savings tools available to help you reach your retirement goals. It’s important that you educate yourself on the benefits of each investment tool, to ensure you retire with adequate financial resources.

If your employer offers a 401(k) plan, take full advantage of your employer’s match. Maximizing the match ensures that you get the full benefit of the “free money” your employer contributes towards your plan.

An Individual Retirement Account, or IRA, is another great way to help you reach your retirement goals. You may also consider making a tax-deferred contribution to a traditional IRA, which can be applied to your 2017 tax return (if made before April 17, 2018).

Increase retirement savings amount each year until you are saving 10-15% of your income. Let us know what questions you have about IRA’s, or other savings tools, – we’re here to help you reach your retirement goals.

Jim Lumpkin, President/CEO, USACU
Jim Lumpkin
President/CEO
USAgencies Credit Union

Introducing… GreenPath

USAgencies is pleased to announce our newest member benefit – GreenPath Financial Wellness.

As a valued member of USAgencies, we are committed to serving you.  And as a benefit to you, we are providing you with free access to money management and financial education services.

USAgencies has teamed up with GreenPath to bring you GreenPath Financial Wellness, a financial education and counseling program.  Through comprehensive education and exceptional service, GreenPath has been assisting individuals for more than 50 years.

As a member of USAgencies, you can receive assistance from GreenPath with:

  • Personal and family budgeting
  • Understanding your personal credit report and how to improve your score
  • Personal money management
  • Debt repayment (fees may apply)
  • Avoiding bankruptcy, foreclosure, and repossession

GreenPath can give personalized answers to your individual needs.  For issues ranging from developing a proactive savings plan to preventing home foreclosure, advice is only a phone call or click away.

To learn more about this new service, simply call 1-877-337-3399 or visit USACU.org/education.

Saving for Your Child’s Education Without Going Broke

The cost of higher education seems to spiral upward every year. Here’s what you need to do to be financially prepared when your child heads to college.

Start early
The average cost of earning a four-year degree could top $205,000 by 2030, according to some estimates. Amassing that kind of cash takes time, so it’s important to begin saving as early as possible, perhaps even right after each child’s birth. The combination of consistent saving, compound interest and investment returns can add up to significant growth over the years.

Explore options
While any investment can be earmarked for college expenses, some savings accounts are designed for this purpose and can provide tax advantages as well:

529 plans
Run by states or schools, 529 plans like the Oregon College Savings Plan let you save for a kid’s college costs with the money’s earnings growing tax-free. While there’s no deduction from federal taxes for contributions, that benefit is fully or partially provided by many states. There are no income or contribution limits, but the money has to be used for a designated beneficiary’s education expenses. Also, gift taxes may apply if you contribute more than $14,000, including any other gifts, to the recipient in a given year.

Coverdell Education Savings Accounts
Formerly known as Education IRAs, Coverdell Education Savings Accounts are trust funds that pay qualifying education expenses for a designated beneficiary. Contribute up to $2,000 annually until the beneficiary turns 18, then use all funds for education before the child reaches 30 years and 30 days old.

Contributions aren’t tax-deductible, but interest and returns earned are tax-free as long as the money is used for qualified educational expenses. To be eligible, your taxable income must be under $110,000, or $220,000 for those filing jointly.

Invest by age
Saving for college parallels retirement planning in that an aggressive investment portfolio, weighted with growth stocks, is recommended during early years with a shift to more conservative assets such as municipal bonds as the time approaches to start withdrawals. Start with equity and stock index funds and begin to adjust the mix once your child turns 9 by putting new contributions into less volatile things like muni bond funds. At 14, begin moving the money out of equities to beef up bond holdings, and aim to be completely out of stocks and equity funds by the time your child starts college.

Better late than never
Saving from an early age is best, but what if you missed that chance? These strategies can help you catch up:

  • To reduce costs, consider enrolling your child in a community college for the freshman and sophomore years
  • Explore available grants and scholarships
  • Keep adding to 529 plans after college expenses start
  • Have your child check out work-study and part-time campus jobs
  • Federal student loans can provide more favorable rates than private lenders

Further stretch your dollars by taking advantage of education tax credits. To avoid being disqualified, pay the first $4,000 of qualified college expense out of pocket before tapping into 529 funds.

With today’s tuition costs, a gap often remains even for those who’ve had a savvy saving and investing strategy coupled with scholarships and federal loans. If you don’t have enough for tuition, check out programs offered by financial institutions and private lenders like Sallie Mae. Look for loans that don’t have application or disbursement fees. Some institutions, like USAgencies Credit Union, participate in loan programs that have competitive rates, flexible payment terms and don’t charge prepayment fees.

With a little planning, research and creativity, your child can earn that diploma while you keep your financial health intact.

© Copyright 2016 NerdWallet, Inc. All Rights Reserved

 

If you have questions about navigating the student loan process, USAgencies can help. Give us a call (503-275-0300), shoot us an email, or just stop by. We’d love to talk!

(Oh, and Oregon residents… we should also mention the Oregon Promise. It’s a great resource for certain Oregon students planning to attend community college.)

 

Going Somewhere this Summer? Use your Cards with Confidence

USAgencies Credit Union is looking out for you in the fight against fraud.

Nearly 60 percent of Americans are taking a vacation trip this summer. Whether you plan a white water rafting trip close to home, or a Caribbean cruise, you can use your credit and debit cards with confidence.

As your financial services partner, USAgencies Credit Union is looking out for you. One of the ways we do that is by offering monitoring systems that help you track your card use. You can easily set up email or text alerts to notify you of transactions, deposits and other activity on your account. Report any suspicious activity to us immediately so we can help to protect you and stop the fraud.

We offer the new EMV chip cards. They provide you with an extra layer of security because every time you buy something, the chip card creates a unique transaction code that cannot be used again. There are some things you should be aware of when it comes to EMV cards. For example, if the merchant doesn’t have a chip reader then you have to swipe the card. If you are buying something online, of course, there is no chip reader. That’s why we recommend that you monitor your card activity and alerts.

When you travel, remember the convenience of the CO-OP ATM Network which gives you access to thousands of ATMs where you won’t pay a fee.

Unfortunately, thieves can place “skimming” devices on ATMs to steal your card and PIN numbers, so they can make fake cards and steal your money. Look for anything unusual near the speakers and beside the screen. Pull or twist on the device where you insert your card to make sure it’s secure. If it is loose, there may be a skimming device inside. If you find a  skimming device has been attached, don’t use the ATM – call police immediately.

When you’re entering your PIN number, use your other hand to shield the number from anyone who may be watching. Know that your PIN can be stolen in other ways too. There is a heat signature left on non-metal keypads for several minutes after you use it. Infrared cameras installed on Smartphones can be used to measure this heat signature and obtain your PIN. Stop this fraud by resting your fingers on other keys while typing in your PIN.

One of the things we do to prevent fraud is to keep our eyes open for any unusual use of your cards. For example, if you normally only use it locally and all of a sudden charges occur at a European resort, that could indicate suspicious activity. For your protection in that case, we might block further transactions from your card and try to contact you. You can avoid that inconvenience by letting us know when and where you’ll be traveling.

Take your receipts with you—never leave them at the counter or in your shopping bag. They might contain information helpful to thieves.

In case you do have to report fraud or suspicious activity, make a list of cards and account numbers, but keep it in a secure place instead of in your wallet. This list will help to stop fraud as quickly as possible.

If you fear you may have lost your card, but you’re not sure, contact us as soon as possible. We have the ability to put a “soft block” on your card while you look. This ensures that no one could find your card and use it while you look. If you did indeed lose the card, let us know and we’ll block it and issue you a new card number.*

If you suspect your card has been stolen, we are here to help. If you report suspicious activity to us we will stop further use of the impacted card, replace it and issue a new card number at no cost to you.

Don’t get burned this summer; Take these small easy steps to protect yourself from fraudsters… and don’t forget that sunscreen!

 

*There is a fee associated with lost cards.

Homebuying 101: A Brief History of Rates & Home Prices

Throughout the next several weeks we’ll be posting articles and info on various aspects of the home buying process. Topics will cover everything from saving for a down payment, to refinancing, to purchasing investment properties, and more. We encourage you to connect with us on any questions you might have, and to share this information with friends and family.

 

Purchasing a home could be one of the biggest financial moves you’ll make, and deciding when the “best” time to make that move can play a big part in how much you’ll end up paying. With fewer properties for sale and rising home prices benefiting sellers, and rising rent rates and low mortgage rates encouraging buyers to jump in, both groups could recognize the benefits of the current housing market.

Currently, those home shopping (or looking to refi) are facing some of the lowest mortgage rates in history. Ultra-low mortgage rates weren’t always the norm, though. Curious about how the market has changed over the years? Let’s take a look…

Year 30-Year Fixed Mortgage Rate Inflation-Adjusted Median Sale Price for a Home Inflation-Adjusted Monthly Payment
1971 7.50% $135,696 $948.81
1976 8.87% $169,352 $1,346.83
1981 16.63% $165,228 $2,306.05
1986 10.19% $183,014 $1,631.83
1991 9.25% $192,124 $1,580.55
1996 7.81% $194,631 $1,402.44
2001 6.97% $215,760 $1,431.10
2005 5.87% $268,974 $1,590.22
2010 4.69% $221,800 $1,149.01
2016 3.75%* $295,600* $1,368.96*

If you look at 2016 vs 1976 you can see that, although the two payments are almost the same, the 2016 payment is based on a much more expensive house. Those buying in today’s market also have the advantage of today’s benefits and wages, so they are likely feeling the effects of the mortgage payments much more lightly than those from 1976’s market.

You can also see from the above data that, although you can’t do much to control the effects of inflation, you can take advantage of much lower-than-average mortgage rates to help keep those monthly payments low. The table shows that rates can, and will, change and that these are some of the lowest rates we’ve seen in decades. If you’re on the fence about whether or not it’s a good time for you to buy or refi, be assured that the low rates we’re seeing are well below average for the past several years.

 

Questions?

Steven Raymond, VP or Residential Lending at USAgencies Credit Union, has over 30 years of experience in the mortgage industry. Steven’s seen it all, as far as mortgages go. If you have questions—about refinancing, getting pre-approved, or anything else mortgage-related—talk to Steven!

Steven Raymond
Vice President of Residential Lending, NMLS#: 234025
Direct: (503) 275-0329
Toll-free: (800) 452-0915 x329
Email: sraymond@usacu.org

Ready to go?
Apply for a mortgage online now.

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USAgencies Credit Union
NMLS#: 441193

Sources:
mercurynews.com/real-estate-news/ci_30047385/since-1971-how-much-home-would-have-cos

*Data for Portland-metro area, Oregon.