Tag Archives: your finances and COVID-19

3 Ways to Stop Overspending During These Times

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Given the current pandemic that continues, you’re most likely more mindful of your finances these days. Even if you have a budget set up, you may still find that money feels a little tight right now. The last thing you want to do in these current times, is rack up unnecessary debt or spend too much money. Here are 3 easy ways to stop overspending.

Cut back on takeout: It’s great to support local businesses right now, but don’t overdo it. Have you been consistently making trips to your favorite fast food drive thru or ordering takeout/delivery? If your takeout budget has increased, your grocery budget needs to decrease. Be mindful of what you are spending on food and if the takeout is taking over your budget.

Pay with cash: After you pay your bills for the month, try to use cash for anything else. Other than necessities that you may still want to purchase online for health and safety reasons, are you shopping online and using a card just to pass the time or buy items you don’t really need? Using cash may prevent you from adding that one extra item to your Amazon or other online shopping cart.

Make do with what you have: Delayed events are happening all over. Movies and concerts have either been pushed back or cancelled. As much as you might want to spend money you normally would spend on summer concert tickets on something else, keep it in your savings account. For now – watch a movie on Netflix you haven’t seen yet, or on your cable network’s free on demand movies. You can also login to YouTube and view a past live concert at no cost. There are many ways to improvise and save money!

 

Article Source: John Pettit for CUInsight.com

Should You File for Bankruptcy?

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Your debt feels impossible. New bills and past due notices are showing up constantly. Creditors won’t stop calling. As you feel like throwing your hands in the air, you wonder – should I file for bankruptcy?

Due to the COVID-19 pandemic, this is a reality that many might be facing. Millions of Americans across the country have been unemployed since earlier this year. It’s incredibly easy to get behind on bills when the money isn’t coming in, but the bills are still showing up. It’s an overwhelming feeling.

The longer this pandemic continues, the more likely it is that you’ll see an attorney on a TV commercial asking if you’re thousands of dollars in debt, feeling overwhelmed by creditors and looking for a solution. Next – they’ll present the option of filing for bankruptcy, which who wouldn’t want to have their debt forgiven, right? Not so fast.

Filing bankruptcy might help you get rid of your debt, but it’s important to understand the serious, long-term effects it can have on your credit. When you file bankruptcy, it remains on your credit report for 7-10 years as a negative remark, and it affects your ability to open credit card accounts or get approved for loans with favorable rates.

What exactly is bankruptcy? Bankruptcy is a legal process designed to help individuals and businesses eliminate all or part of their debt, or in some cases – help them repay a portion of what they owe. There are several types of bankruptcy, but the most common types are Chapter 7, Chapter 11 and Chapter 13.

Chapter 7 forgives most of your debt and allows you to keep all of your assets with a few exceptions, depending on state and federal laws. During the process, you and your creditors are invited to a meeting where they are allowed to make a case as to why a federal bankruptcy court shouldn’t forgive your debt. Once your case is approved, your debt will be forgiven, and none of your creditors will be allowed to hassle you over the forgiven debt.

Chapter 11 is generally for small business owners. It allows small business owners to retain their business while paying back debts according to a structured plan. With this option, business owners give up a certain amount of control to court officials, debtors, or counselors assigned to help them rebuild their credit. Despite losing some control of the business, owners are able to keep their business running while working on their financial future.

Chapter 13 is different than Chapter 7 in that it requires you to come up with a plan to repay your creditors over a 3-5-year period. After that, your debt will be forgiven.

Things to consider if you’re thinking about filing bankruptcy:

It’s important to note the serious impact bankruptcy can have on your credit report. Bankruptcy effectively wipes out everything on your credit report – good and bad remarks, and will stay on your credit report for 7-10 years.

This also means any account you’ve paid off or left in good standing that could positively impact your credit score, is also wiped out. Any hard work you’ve put into building your credit is basically nonexistent once you file bankruptcy. All the negative remarks will be gone as well, but you will also be considered high-risk when it comes to lending moving forward.

Bankruptcy affects your ability to open lines of credit – credit cards, mortgages, auto loans, personal loans, etc. Because you will be labeled high-risk, most banks will likely deny any application you submit for a line of credit – even though your credit score might have gone up when your credit report was initially wiped out. If you are approved for a line of credit, you’ll likely get a much higher interest rate which will make your monthly payments higher too.

Should you file for bankruptcy?

When it feels like your debt is caving in on you, bankruptcy might seem like the only way to reach financial peace. Here are a few steps to consider taking before you consider filing.

  • Take a moment to talk to your creditors. Negotiate and see if there are options to make your debt more manageable. Can you lower the interest rate? Is it possible to settle for less than you owe? Can you set up a payment plan?
  • Talk to us about your financial picture. We might have options that will allow you to consolidate your debt into one, more affordable payment.
  • Go through your house. Do you have things you don’t use or need that you can sell? If so, sell some of those items and apply that money to your debt.

Also, it’s important to note that not all debt is eligible for bankruptcy. While bankruptcy can eliminate a lot of your debt, some types of debt cannot be forgiven:

  • Most student loan debt.
  • Court-ordered alimony.
  • Court-ordered child support.
  • Reaffirmed debt.
  • A federal tax lien for taxes owed to the U.S. government.
  • Government fines or penalties.
  • Court fines and penalties.

Bankruptcy should be the last option you consider. Look through your debt, see what you owe and carefully weigh all your options. Again, make an appointment to come in and talk to us and we can help you review your options. We’re your credit union, and we’re here for you!

5 Ways Being Home Can Save You Money

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As the public health emergency continues, what are you up to these days – working from home? Taking fewer trips? Eating at home more? Chances are, you’re probably saving money on gas and your usual food tab.

Hopefully, there are other areas where you’ve been able to save money as well. Check out these tips below that can help save you money whether you’re quarantined or not!

Unplug It

How many devices do you leave plugged in during the day? Did you know that even in standby mode, any electronic device that is plugged in will still suck energy?

Energy.gov reports that “an appliance constantly taking in 1 watt of electrical current is equivalent to 9kWh per year, adding up in annual costs (basically $1/watt/annual). Considering how many appliances are used in an average household, costs can quickly add up to $100-200 a year.”

If you’re not using it, unplug it. Or, use a power strip that can be turned off. It’ll save you money in the long run!

Save Water

You might be tempted to throw half a normal load of wash in, but first ask yourself – are there enough dirty clothes to make it worth it or do you have an energy efficient load sensing washing machine? Another tip to conserving energy is washing in cold water when you can, since the majority of your machine’s energy consumption happens when it needs to heat the water.

While you’re home – conserve water by taking shorter showers. If each member of your family reduces their shower time by 3 minutes, you’ll save about $100 a year on your water bill.

Check Your Policies

You’ve probably seen the car insurance commercials advertising a credit to customer accounts. Check into that. Give your insurance company a call or check your account online. Most companies are giving their customers a 15 percent credit because they aren’t driving as much. In some cases, customers are getting a $150 credit added to their policy for the duration.

Don’t sleep on the chance to save some money on your auto insurance. While you’re at it, check on your other policies and accounts. You might find other places offering a similar discount to help out their customers.

Cool It Now

What is your thermostat set on? If you’ve adjusted your thermostat during the day now that you’re working from home more, you might want to tweak that a bit to offset the cost.

Find Your New Normal

We’ve all said it – “when things get back to normal.” But now we’re all in the position to redefine what normal looks like for us. Take a moment to reevaluate your priorities and budget. Are their unnecessary subscriptions you can cut? Is there a magazine, streaming service or even gym membership that is no longer valuable because you’ve found an alternative? If so, cut those from your budget and save some money each month.

Article Source: https://www.schlage.com/blog/categories/2020/05/5-ways-to-save-money-at-home.html

 

Costs You Can Cut to Save Money During the Pandemic

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If you’ve been affected by COVID-19 due to unemployment or reduced hours (or even if you haven’t been affected in this way), it’s extremely important to focus on saving money and not spending money on items that are not absolutely necessary during this time.

Here is a list of suggested items you may want to consider cutting out during the Coronavirus pandemic:

  • Subscriptions – You might be stuck at home, but if paying for a multitude of subscription services like Hulu, Netflix, Amazon Prime, Disney Plus, and the like are strapping your monthly budget, it’s time to temporarily suspend them. Or, if there’s one you use more so than some others in particular – keep one subscription service you are actually using.
  • Gym membership – More than likely your gym has been closed for the past two months, are you still paying for a facility you haven’t been able to use and may not be able to use for some time? See if you can have a hold placed on your membership, or if you can cancel and take advantage of exercising outdoors in the nice weather or utilizing free online workouts instead.
  • Services you can DIY – If you’re home on a daily basis, are you still paying for a lawn mowing service or yard maintenance? If so, this might be something you want to consider tackling yourself to save on monthly bills. Plus – you’ll get to enjoy the sunlight and fresh air.
  • Expensive cable packages – If you are paying for extra sports channels that aren’t even showing any sports right now because they’re cancelled, or premium channels like HBO and Showtime – call your cable company and temporarily suspend them. Anything you can do to make your bill less during this time is advisable. If you can cut out cable TV altogether and just pay for one streaming service, even better. Also, try not to order on-demand movies either during this time. That will continually make your monthly bill increase. Instead, see what free movies might be available.
  • Non-essential food expenses – Cooking at home is a big money saver. If you are continually having food delivered or buying takeout for your meals, costs can really add up. If you can, try to cook your meals at home and only order takeout once in awhile for a special treat on a weekend.
  • Shopping – While retail stores and malls are closed, you may instead be doing a lot of online shopping these days. Even if an online retailer is having a sale, is the item something you really need? Really evaluate all your expenses before you click “add to cart.”
  • Driving around – You might be itching to get out of the house, but driving around and burning through gas is going to eventually add up. Unless you have to get in your car to go to work or to an essential business, walking or jogging outside on a nice day is a much cheaper option.
  • Vacation fund contributions – If you’ve been saving money toward planning a trip, pause it for now. Since traveling is out of the question for the near future, put these contributions into an emergency savings account instead.
  • Seasonal memberships – Take a look at what might be coming up that you won’t be able to participate in like usual (swim club, sports season, theme park, etc). Make sure you aren’t being automatically billed for events you won’t be able to partake in this spring and summer.
  • Gifts – Since celebrations have been put on hold, take the funds you would have spent on them and put it in your emergency savings account.
  • Bottled water – This is a nice to have, but definitely not a necessity. You’ll save a great deal more money by making a one-time purchase on a refillable filtered water pitcher.

By reducing expenses of non-essential items, you can increase the amount you save to make sure you’re still able to pay your bills or have some money in savings if you need it. The last thing you want to do in a financial environment like the current one we are in, is to put yourself in debt. Stay financially safe and healthy!

Article Source: Gabrielle Olya for Gobankingrates.com

More Ways to Make the Most of Your Coronavirus Stimulus Check

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If you already received your stimulus payment directly deposited into your bank account, or even if you are still awaiting a paper check in the mail – it’s a good idea to have a plan on how you will use this payment. Everyone’s financial situation is different, but here are four additional ways to consider spending your coronavirus relief check.

First and Foremost: Cover Your Needs

If there were ever a time to prioritize needs over wants, it’s right now. This is especially important if you’ve lost income due to unemployment, reduced hours or slow business. If this is the case for you, your stimulus money should go toward making sure you have a roof over your head and food on the table.

Create a budget and add up the cost of your essential expenses. Then look at how much money you have in your bank accounts as well as your stimulus check, to get a good picture of how long your money will stretch. Feeling overwhelmed? Create a budget that works for you with our budgeting guidebook.

If you are having trouble paying your bills, reach out to your financial institution or lender as soon as possible. Many are offering payment deferments and other relief options during this time.

Increase Your Savings

If you’re still working and bringing in enough money to cover your essential needs, look to using your stimulus check to boost your emergency fund.

No one can predict how long this pandemic will last and shelter-at-home advisories have forced many industries to change how they do business or temporarily shut down.

While the typical advice is to have at least three months’ worth of living expenses in an emergency fund, you might want to increase that if you can. Your emergency fund should help you feel financially secure. You will also want to separate your emergency savings from your spending money. A higher yield or money market account will earn interest while your money is sitting in the bank.*

Think About Your Future

If your finances are in good shape and you have an emergency fund, consider spending the money you’ll get from your stimulus check to set yourself up for a better financial future (i.e. going toward that side or start up business you’ve always wanted to get off the ground).

Making a dent in your debt up front could also help you save money in the long run. You also might want to think about using your stimulus money to cover initial expenses that’ll help you save money over time (i.e. buying gardening supplies so you can grow your own produce and cut costs on groceries while also staying out of the store right now).

Help Others

If you’re in a financially stable situation with a healthy emergency fund, another good use of your stimulus money could be to help others who need it.

Use the extra cash to help a family member or friend in need, or donate to a reputable charity. You could also spend your money to support local businesses and restaurants — whether that’s through online orders or purchasing gift cards for future in-person visits.

*A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. Click here to view full Rewards First program details. A First Financial membership is required to open an account or loan and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean counties.

Article Source: Nicole Dow of The Penny Hoarder

6 Ways to Spend Your Stimulus Payment Responsibly

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Did you receive your COVID-19 stimulus payment on April 15th? Have you started thinking about how you should spend it?

It’s tempting to think about all of the ways you could spend an extra $1,200 or $2,400 – depending your filing status and the number of dependents you claim. Before you get that list finalized, we want to give you some tips to help your money stretch as far as possible.

Prioritize. Look at your bills. Which ones are essential (rent or mortgage, car payment, utilities), and what bills are non-essential (entertainment, streaming services, unusable memberships)? Make a list of what you need and what you can live without. Focus on paying the essential bills first.

Save. Save. Save. Don’t miss an opportunity to pad your savings account with some of your stimulus money. It’s a one-time payment, so think of your stimulus as a mini emergency fund. You may want to set aside some of the payment as “just in case” money.

Divide and Conquer. You only get one stimulus payment, but your bills will still come monthly. If you’re currently unemployed, it’s especially important to be strategic in how you spend your stimulus payment. Take this opportunity to divide it up into smaller chunks to help cover some of the essential bills you pay each month. Also, talk to your landlord or mortgage lender, your utility company and internet service provider, if you’re having trouble meeting your monthly obligations. Many companies are finding ways to help their customers defer payments during this unprecedented situation.

Don’t Hoard Cash. Hoarding cash is a bad idea in general. Your money is much safer at your financial institution than it is in your home. So, bring it to us and let us safeguard it for when you need it!*

Pay Down Debt. Paying off debt is almost never a bad financial move, but think about it and prioritize carefully. Even in these uncertain times, paying off any highest interest debt isn’t a bad idea. However, don’t feel like you need to be in a hurry to spend all your stimulus money to pay off debt. Look at your options for forbearance, payment deferrals, or even the option to skip a monthly payment. If you can get some relief on your debt in the coming months, let your stimulus payment sit in your savings account.

Splurge Smartly. We’re all feeling the weight of stress and uncertainty as we wonder when this pandemic will end, and life will return to normal. No matter how you decide to spend your stimulus check, see if you can set aside a little bit to spend on something fun for yourself. Maybe even shop at some of your favorite local businesses to offer support. Remember: the government is hoping these stimulus payments will put some cash flow back into the economy to stimulate it.

Over the past couple of months, we’ve faced a situation no one could’ve possibly prepared for. We know that our members have been affected in some way by the COVID-19 pandemic. While the stimulus payments will certainly help and offer some relief to most, please know that First Financial is here for you. We want to help you stretch your stimulus payment as far as can go. Give us a call and let us figure out a way to help you!

*A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. Click here to view full Rewards First program details. First Financial membership is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties in NJ.