How to Prevent Your Child from Becoming a Victim of ID Theft

It probably seems ridiculous to worry about identity theft happening to your children. They don’t have a driver’s license or a credit card in their name – it’s impossible for their identity to be compromised, right?

Wrong. The risk of a minor having their identity stolen is 51 times higher than the risk to an adult. On average, identity theft affects 15 million U.S. residents per year.

Keep reading to learn why minors are considered perfect targets for identity thieves, and how to prevent your child from becoming a victim.

What Kind of Person Would Target a Child?

A smart one. While children lack credit or debit card data that can be stolen, or savings accounts that can be depleted, they do have a credit history that is as clean as a whistle.

Generally, a minor’s credit history is left alone until it is time for them to apply for student or car loans. This gives identity thieves over a decade’s worth of time to target a minor’s information without anyone taking notice.

Then, that exciting bridge into adulthood when your child takes on the responsibility of applying for loans and credit cards is shattered when you realize he or she is denied due to a less than perfect credit history resulting from years’ worth of unpaid debt.

As an adult, you can understand the time it takes to repair a bad credit history. Your child shouldn’t have to go through this “repair phase” when they haven’t done anything to harm their credit in the first place.

Be in the Know – Recognizing the Warning Signs

The following are some tell-tale signs that something is amiss with your child’s identity:

  • Suspicious Preapproved Credit Card Offers Addressed to Your Child If you begin receiving offers for preapproved credit cards in your child’s name, this could be an alert that there may be a credit file associated with your child’s name and social security number.
  • You are Receiving Calls from Collections Agencies If you’re contacted by a collections agency trying to collect debt in your child’s name, it’s a red flag that that their information has been compromised and is being used illegally.
  • Your Attempts to Open a Financial Account for Your Child are Denied If you try to open a student savings account for your child only to realize an account already exists, or the application is denied due to poor credit history – you should take immediate action.

Take a Stand – What to Do if You Suspect Your Child is a Victim of Identity Theft

1. Contact All Three Credit Reporting Agencies

  • Ask that they run a free “Minor Check.” If the check returns no results for your child’s social security number, you can rest easy that no illegal activity is taking place.
  • If the check does return results, ask that all three agencies remove all accounts, inquiries, and collections notices from any files associated with your child’s identity.
  • Ask that a fraud alert be placed on your child’s credit report.

2. File a Fraud Report For Your Child

  • This can be done online through the FTC or by calling them at 877-438-4338.
  • The police may need to get involved if the fraud relates to medical services or taxes.

Moving forward, be very selective about who you give your child’s social security number to. This will help to protect your child’s identity and give you peace of mind as you work to build a strong future for your child.

Article Source:  Kara Vincent for Lancaster Red Rose Credit Union

3 Bad Money Habits You’re Passing on to Your Children

It can be easy to forget in our busy day-to-day lives, that our children are paying close attention to our words and actions. They emulate what they see around them and grow increasingly impressionable with age. It’s important to positively influence them by demonstrating proper behaviors and habits they can learn from. When it comes to finances, there are a variety of ways you can properly educate your children, including discouraging them from practicing these three bad money habits.

Impulse buying

When you go shopping do you follow a set shopping list? If your answer is “no” and you shop with your children, it’s time to start sticking to your plan. When you’re shopping, and grabbing things without any forethought, you are showing your children that sticking to a budget is not your priority. They may also view your impulse shopping as disorganized and unstructured. Instead, instill in them the importance of writing down a plan and getting only what’s necessary, to stay on the right track with spending.

Not talking about money

As children get older and they begin to understand the value of money, it’s important they are taught to be open about financial issues. Some view money matters as difficult or awkward to talk about. But, when it comes to building confidence in your children, it’s vital they learn the skills necessary to effectively manage their personal finances. Developing healthy financial habits from an early age is extremely important and it begins with everyday conservations.

Living above your means

If your child asks for something at the store, but you don’t have the money to buy it, it’s okay to use that old saying, “money doesn’t grow on trees.” So many Americans live outside of their means in an effort to “keep up with the Joneses.” Instead of raising entitled children that expect everything no matter how tight funds are, teach them the importance of differentiating between “wants” and “needs.” Help them understand that it’s okay to splurge on occasion, but it’s more important to budget and save in order to maintain good financial standing for a happy, stress-free life.

Article Source: Wendy Moody for CUInsight.com

Teach Your Kids to Take a Stand — A Lemonade Stand

Long before Beyoncé transformed it into a cultural touchpoint, lemonade was the commodity of choice for childhood business ventures. Perhaps you had a lemonade stand of your own, or maybe you just knew someone who did. Either way, the memories of ice-cold refreshment probably ride on a warm wave of nostalgia. If your enterprise was especially successful, you might even hear a faint “cha-ching” as you reminisce.

Fast forward a decade or two, and now you find yourself juggling the demands of family, friends, and career. Thanks to the latest technology, it’s easy to let your kids spend their summer vacation drifting along on a digital stream of Snapchat streaks and Fortnite marathons. With the dog days of summer approaching, you have a perfect opportunity to shake up your child’s summertime routine with a little old school entrepreneurship. It’s time to bring back the lemonade stand!

Let your kids in on the fun. When you were young, running a lemonade stand didn’t feel like a job—it felt like freedom. So, don’t worry that encouraging your children to work will somehow rob them of their summertime fun. The venture can be fun, and the lessons they learn from operating a small business can last a lifetime.

Goal setting

Believe it or not, this one comes pretty naturally to kids. If you ask them what they want to do with the money they earn, they’ll probably have at least one goal already in mind. It may be a video game, a bike, or new clothes, but whatever it is, their motivation won’t be hard to find. When they finally save up enough to buy what they want, the sense of accomplishment will be something you can build on for the rest of their life.

Entrepreneurship

Operating a lemonade stand is an excellent way to help your children learn that it costs money to create something. After all, lemons and sugar aren’t free. Understanding economic concepts like cost of goods and profit margins, will give your kids a valuable perspective with real-world applications. As they plan their drink prices, let them decide what to charge. Positive or negative, the lessons they learn from experience will help them with future budgeting.

Responsibility

Like many things in life, lemonade stands are super fun at the beginning! But after a few hours sitting in the sun or waiting out a thunderstorm, there’s a pretty good chance your little entrepreneur will want to close up shop. While it may be frustrating (for you and them), this scenario provides an excellent opportunity to teach them that you can’t just walk away when you get bored. And let’s be honest, we can all use this reminder from time to time, can’t we?

Creativity

Challenge your child to think about how to separate themselves from their competition. (Of course, this may be hypothetical competition since modern-day lemonade stands are probably few and far between). Depending upon their age, your little one may focus on colorful sign design at first. This focus is understandable, since making the sign is half the fun. But beyond that, feel free to offer creative suggestions. Could they provide a sugar-free alternative? Maybe offer an iced coffee alternative to appeal to more customers? How about spreading the word with a social media post? Should they accept payment through Venmo or PayPal, or just keep it cash only? Like a child’s imagination, the options are limitless. So is the fun!

At this point, you may feel like opening up a lemonade stand whether your kids are interested or not! Channel that excitement and energy into helping them see the fun-filled potential of the idea, and don’t be afraid to get in there and help them when they need it. The time spent together will be even more valuable than the money earned and the lessons learned.

Happy summer lemonading!

Congrats Graduate! 4 Things to Do with Your Gift Money

Cash tops the list of popular graduation gifts year in and year out. If it’s your turn to don a cap and gown this year, congratulations – you probably pocketed a significant amount of change along with your achievement. So, what are you going to do with it?

Since we tend to view graduation gifts as a form of “extra” money (a psychological money trap known as mental accounting), it can be tempting to quickly reach for that wish list. Before you do though, consider these four ways you can use it to both celebrate your achievement and give yourself a better financial foundation for the future.

1. Celebrate the present.

You’ve achieved something important, so go ahead — spend some of that money on yourself, any way you’d like. Instead of blowing the whole sum, financial advisors recommend setting aside about 10% for yourself. If your cash gifts totaled the $1000, that still gives you $100 to spend on clothes, electronics, entertainment – whatever.

2. Invest in your future.

With the other 90%, one good choice is to invest in tools that will help you succeed in your next life steps. If you are jumping into a high tech job, maybe you’d like a new laptop or specialized software you could use to make work life more efficient.

There are also other practical needs like expensive furniture and household goods if you are moving out. Although the return can be harder to quantify, putting some of your graduation gift money toward these expenses is an investment in yourself.

3. Save for the future.

Graduation cash doesn’t have to burn a hole in your pocket – it’s okay if you don’t have a plan for it right away. In fact, saving it is a very good plan. If you’re already on a budget or would like to start, treat your graduation money like income and apply the 50/20/30 rule. Savings is the 20%, so calculate this much and set it aside.

Although you can certainly save for the future in terms of life after high school or college, you may need to first focus on shorter-term needs like living expenses. One of the best places to save your cash is in a separate savings account (or an account you won’t be using for daily purchases). Since you won’t see or use this money all the time, you’ll feel less tempted to spend the funds on impulse purchases.

4. Invest for your future.

Investing in your future is important, but so is investing for your future. For young investors, many financial advisors recommend mutual funds with low-cost index funds. The key is to choose an option that doesn’t require extensive management, knowledge, or risk, especially when you’re just getting started.

The amount you invest isn’t so important; after all, your money and your salary will grow for decades to come. They key is to start learning the ins and outs of investing. Not only will this give you another, potentially more profitable savings channel, you’ll learn solid investment management skills that will set you up for the future when you need to properly allocate the wealth you will accumulate for the rest of your life.

Questions about investments? To set up a complimentary consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your savings goals, contact us at 732.312.1500 or stop in to see us!*

Regardless of how little or much your graduation cash amounts to, determine to enjoy a little, save a little, invest in yourself, and plan for the future. The way you choose to use this money can set a trend of how you’ll manage your money for years to come, so let it be a good one!

*Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 800-369-2862. Non-deposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.

Article Source: Jessica Sommerfield for moneyning.com

 

Personal Finance Lessons Students Should Learn Before Graduation

How to make a budget.

It all starts with the budget. Here, students can compare earnings to expenses. It will give them insight into the value of a dollar. With a budget, students can plan for major purchases, eliminate debt and create good saving habits. Check out our budgeting guide here!

How to balance a checkbook.

While few people probably write checks anymore, students should still know how to balance a register. Even if they prefer to use an app to help keep up with their funds, the basic accounting skills they’ll gain from an old-fashioned register will give them insight into how their money flows. It will also teach them that even financial institutions can make mistakes, so it’s good to check the account for errors or fraud on a regular basis.

The real cost of credit cards.

Credit cards have advantages, but as anyone who’s gone into debt knows, those advantages can come at a significant cost if card holders aren’t careful. Understanding how compound interest works and what that $40 shirt will cost them if they take years to pay it off – will help them make wise choices with their credit.

How to build good credit.

Good credit can save them exponentially over a lifetime. Everything from home and auto loans, to job applications will be affected by a person’s credit score. Teaching students about what makes their score good, how to build it and how to monitor it will set them up for years of success.

What to do when it goes wrong.

Having a financial backup plan can make the difference between disaster and survival, when a major catastrophe strikes. Tools such as health and homeowners insurance and a savings account are critical, but increasing numbers of Americans do not employ these resources. Teach students how to plan ahead of time so they can weather inevitable disasters successfully.

Article Source: Jennifer Reynolds for CUInsight.com

First Financial Hosts Student Run LIFE Fair at Jackson High Schools

Press Release

(Pictured above: First Financial staff members and students from the Jackson Academy of Business teach fellow students about the financial realities of life at Jackson Memorial High School).

Freehold, N.J. – First Financial Federal Credit Union held their first student run LIFE™ (Learning Independent Financial Education) financial reality fair events at both Jackson Liberty and Memorial High Schools with the Jackson Academy of Business (JAB) students. While the credit union has hosted financial reality fairs in the past, this fair was actually staffed by high school students, who sat behind each of the financial tables and worked with other students to help plan their financial future. Approximately 160 students at each school participated in this hands-on version of the “game of life,” during which they were required to make on-the-spot financial decisions.

The LIFE™ Fair consists of a full day hands-on experience where students, after identifying their career choice and starting salaries, are provided a budget sheet requiring them to live within their monthly salary while paying for basics such as housing, utilities, transportation, clothing, and food. Once the students visit all the booths, they balance their budget and sit down with a financial counselor to review their expenses and get a “financial reality check.” At the student run fairs, First Financial staff members worked at the financial review tables with each of the participating students to provide insight.

In regard to the school’s experience with their first ever student run LIFE™ Fair, Laurie Shupin, Jackson Liberty teacher and the high school’s JAB coordinator stated, “The students felt it was an excellent learning experience and became more knowledgeable of the subject matter as the day progressed.  They are looking forward to more presentations and would love to extend it to the fall and spring semesters.” Laura Fecak, Jackson Memorial teacher and JAB coordinator stated, “The LIFE Fair was a great opportunity for all of our students involved.  It was an eye opening experience for the Financial Literacy students that came through to get a dose of reality, connecting classroom concepts to real life situations.  As well as, for the Jackson Academy of Business students that got to act as the sales representatives in a variety of situations (housing, transportation, technology, furniture, etc.).”

While the LIFE™ Fair was certainly full of temptations, the students had to spend their money wisely while being able to save and budget themselves for the future – while also enjoying everything life has to offer. First Financial President and CEO, Issa Stephan, concluded, “Our mission for our first student run LIFE™ Fair was to help the students understand the value of money and how to manage their money, so as they grow as an adult they’ll become more financially responsible. The student run fair was able to show the high school students even more about the financial realities of the real world. Our credit union puts a high priority on financial education, after all – that’s how First Financial began in 1936, with a group of schoolteachers in Asbury Park.”

(Pictured above: Jackson Liberty LIFE Fair).

Additional photos from the event can be seen on First Financial’s Facebook page. To inquire about or set-up a LIFE™ Fair for a Monmouth or Ocean County, NJ school or business – please contact the Business Development Department at  business@firstffcu.com.

###