SafeAmerica Credit Union

GreenPath

• By Kevin Alvarez

Get Ready For A Credit Card Spring Cleaning

Take an inventory of your consumer credit cards. Pull out seldom-used credit cards tucked away in the recesses of your purse or wallet or stashed in the bottom of your junk drawer. Destroy any cards you no longer use.

For those cards that you do use, try not having the plastic at your fingertips. This prevents you from increasing your debt.

1. Take Inventory

Take an inventory of your consumer credit cards. Pull out seldom-used credit cards tucked away in the recesses of your purse or wallet or stashed in the bottom of your junk drawer. Destroy any cards you no longer use.

For those cards that you do use, try not having the plastic at your fingertips. This prevents you from increasing your debt.

2. Review Your Credit Reports

One in three Americans has never checked their credit report, according to a Bankrate study.

The information in your credit reports is used to calculate your credit scores — those three-digit numbers that help determine whether lenders approve you for new credit and what interest rates they offer you. In some states, employers can request access to your credit reports during the job interview process, because your credit history is seen as a reflection of your overall reliability.

Annualcreditreport.com now allows weekly updates of all 3 bureaus. If something’s inaccurate, there are ways to reach out to credit bureaus for resolution. It’s a “one-stop” to check your reports from Experian  Equifax, and TransUnion – the three industry-standard credit bureaus.

3. Take A Deep Dive Into Credit Scoring Categories

After you’ve reviewed your credit reports for accuracy, it’s a good idea to learn how your information and activity are used for credit scoring.

To understand how your credit score is calculated, know that each credit bureau has its own methods of scoring. They generally follow a similar calculation that weighs usage and activity in the following ways:

  • Payment history (35%): A history of your credit usage allows lenders to grade your level of risk and dependability. It accounts for the largest chunk of your credit score (35%), so it’s important to pay your bill on time and avoid risky behavior.
  • Amounts owed (30%): Also known as credit utilization, this category compares your overall debts owed — e.g., credit card balances, mortgages, auto loans, etc. — and compares them to your credit limit.
  • Credit length (15%): A lengthy credit history is a sign of responsibility. This category looks at the age of your oldest credit account and the average age of all your credit accounts.
  • New credit (10%): This category is a balancing act of action and restraint. While it’s important to open new revolving and installment accounts to keep your report active, too many credit inquiries can lower your scores.
  • Credit mix (10%): The credit bureaus value experience, so they like to see a mix of different kinds of debt — credit cards, installment loans, mortgages, etc.

4. Address Your Debts

Nearly half of all Americans carry credit card balances from month to month. With a healthy history, your credit card provider may be willing to lower the APR on your balance, making it easier to tackle the principal amount. Contact customer service and ask about their policies.

Another idea is to better track and manage monthly spending in favor of debt reduction. For example, consider canceling your expensive cable service in exchange for a streaming service. If utility bills are high, ask for a free energy audit of your home to identify money-wasters. Freeing up extra monthly income can help you take control of your debts and improve your credit score in the process. A spending plan worksheet can be of great help.

5. Safeguard Your Identity

We regularly hear about data breaches that impact consumers. Be sure you are doing all you can to monitor and manage your online safety, from better password management to signing up for Equifax’s free credit monitoring service to safeguard your information.

Store your social security number, online passwords and other identification in secure locations or protected password management file. While you can’t always control who sees your information, you can take a proactive stance when it comes to identity theft.

The Benefits of Credit Card Spring Cleaning

A credit card spring cleaning is a good chance to understand maintenance you might need to get things in order and improve the performance of your overall financial situation. You might also look into a debt management plan for additional options.

Our partners at GreenPath Financial Wellness offer free financial counseling and education to support you in meeting your financial goals. Their professional, caring financial coaches will work with you to assess your situation, explain the options or solutions available, and help you create a spending plan to meet your goals.

Greenpath Financial Wellness

• By Kevin Alvarez

America Saves Week – Save As A Family

We start kids young with almost everything— sports, school, so why not saving? We are always looking for new ways to #ThinkLikeASaver in the America Saves community. The earlier that you have a positive mindset around saving, the easier it is to save successfully as an adult.

The idea of saving doesn’t always have to be tangible. There are definitely ways to save around your home that aren’t as black and white as putting money in a piggy bank or opening up a youth savings account.

Those small things that we expect our children to do around the home are contributing to saving as a family. This is important to communicate with them for several reasons, mainly as it can be a great motivator for them if your family is saving for a vacation or some other fun family gift or experience.

Here are some ideas of ways your children can save around the home

1. Teach Them To Turn Off The Water

Did you know using a (newer) dishwasher saves more water than hand washing dishes? Small adjustments like turning off the water while brushing your teeth, and ensuring a ‘full’ load of laundry during washing can save you big on your water bill.

2. Teach Them To Conserve Energy.

This may seem like a no brainer, but turning off the lights and TV are one of the easiest things to forget when headed into another room or rushing out the door. Kids thrive when they feel like they’re the leader. Assign them the role of ‘Energy Saver’ and make it their responsibility to turn off all the lights, keep the refrigerator door closed, or checking to make sure the television is off if not being watched. Explain to them that they are helping the family save by keeping a lower electricity bill. You could even sweeten the deal by having an enticing Family Savings Goal, like visiting a local play place or even a more significant vacation. Equating saving with something they love will make it easier for them to understand the importance.

3. Teach Them To Enjoy Cooking At Home.

Eating out may be convenient, but cooking at home can be just as satisfying, especially when you get your kids involved. Try making their favorite pizza from scratch. They may enjoy the process and the taste way more than your usual take out order.

4. Teach Them To Grow Their Food.

Like cooking at home, when children have ownership of something, they’re more likely to enjoy it. Can you imagine how much more eager they’ll be to eat their broccoli and carrots if they grow it themselves? Not to mention, you will save quite a bit by growing your own fruits and veggies.

5. Have At-Home Family Nights.

Get creative by having low-cost family fun activities such as family game nights, card games, (indoor or outdoor) movie nights, backyard campouts, and more. You’ll find it very easy to have fun and bond as a family, from the comfort of your home. A one-time investment for these activities can save you so much and keep the fun going for years to come.

By making these tips a habit, you’ll save on utility bills and entertainment. More importantly, you’ll be setting the foundation of positive saving habits with your children, which will last a lifetime and is priceless

If you have a goal of saving successfully, be sure to take the America Saves Pledge, choose your savings goal, and get support and great tips!

Make the Pledge

By accessing this link, you will be leaving SafeAmerica's website and entering a website hosted by another party.

Although SafeAmerica has approved this as a reliable partner site, please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of the bank's website. The other party is solely responsible for the content of its website.

We encourage you to read and evaluate the privacy and security policies on the site you are entering, which may be different than those of the bank.

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Learn about our savings accounts

• By Kevin Alvarez

Take These Steps With Your Student Loans

What steps should you take with your student loans – even with the extension of federal student loan payment relief measures? The pause continues on federal student loan debt collection and reduced interest rates on federal student loans to 0% until May 2022.

For those with government-held loans, the relief options provide a record-long “breather.”

It’s not too early to take steps in preparation for the relief programs to end. Borrowers should be ready to make student loan payments, even as policy makers discuss further extensions in the face of an increased number of borrowers becoming delinquent or defaulting on their loans.

Listed here are steps to move forward as protections end.

Take Inventory

How’s your memory in the midst of the longest payment freeze of federal student debt in history? As a first step, take the time to document how much you owe and who to contact about student loan balances.

To get current loan balances, log onto the National Student Loan Data System (NSLDS). The portal will display how much you borrowed, the type of each loan and interest rate, payment history, and the current loan servicer for each loan.

For private student loan information, jog your memory with your credit report, which tracks current and past credit obligations, including student loans. AnnualCreditReport.com provides borrowers with a free report from the three main credit reporting agencies: Equifax, Experian and TransUnion.

These resources are also useful to track current student loan servicers – the organizations that handle payment and administration of your debt.

Track Your Interest Rates

Student loan interest rates vary depending on the loan type and other terms such as the date the funds were first disbursed to you. Again, NSLDS is the go-to resource to discover the interest rates of your federal student loans.

To track interest rates on private student debt, contact each lender for fixed and variable interest rates. SafeAmerica Credit Union offers private student loans through our partner, Lendkey. Click here for current rates and loan programs.

Look at Affordability of Payments

After the lengthy payment pause ends in May 2022, consider overall affordability. Based on your current monthly income and expenses, you might find that resuming payments for federal student loans will stress your budget.

Explore options to lower monthly payments by switching to an income-driven repayment plan.

Private student loan lenders typically don’t offer income-driven plans, but they might offer alternative repayment plans on a case-by-case basis.

Loan forgiveness might be an option. In the last few months, the Department of Education overhauled the Public Service Loan Forgiveness Program. Teachers, nurses, first responders, service members, those working in nonprofit hospitals and other nonprofit and public service workers can potentially have their student loans forgiven

Explore whether you can take advantage of the changes to the public servant loan forgiveness program..

See if Loan Consolidation is Possible

Again, if affordability is an issue, consolidating your student loans sets you up with a single monthly payment.

For most borrowers, consolidation lengthens the repayment period, so your cost of borrowing will actually be higher since you will likely pay more interest over the long run.

This option will depend on your specific financial picture, so be sure to research all the pros and cons of loan consolidation.

Take the Steps that Work for You

It's great to have the added breather for your budget!

Looking ahead to later this year when the payment pause ends, our partners at GreenPath is a useful source of independent information.

Student loan counselors can suggest ways to manage an individual situation if you are feeling overwhelmed as you look to the May 2022 deadline.

This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit

 

Greenpath Financial Wellness

• By Kevin Alvarez

Get Your End-of-Year Financial Health Checkup

As the eagerly awaited holiday season gets underway, the end of the year is a great time to get a financial health checkup to make sure finances are on track.

With regular checkups, you can fix small problems before they become big issues.

This year-end keeping financially healthy is especially important due to many economic uncertainties related to inflation, inventory shortages, as well as the expiration of COVID relief programs put in place more than a year ago to help people manage through the pandemic.

Your Financial Health Checkup

Like a physical health checkup, a financial checkup examines your vital signs to be sure all is well when it comes to you financial health and wellness.

Do you have an emergency savings? How do your credit card balances look? Are you tracking monthly income and expenses? What does your credit score and history look like? These are a few of the vitals reviewed during an end-of-year financial checkup.

From an overall budget review to managing credit card debt, the caring, NFCC-certified counselors at GreenPath Financial Wellness will conduct a full review of your current financial fitness and provide recommended next steps for improving your financial health.

A financial checkup guides you to:

  1. Review Your Financial Goals: Has there been a significant life change this past year? A change in jobs, a marriage, divorce, home purchase or other big change can affect your overall financial picture. A check up is a good time to assess whether your current financial goals sync up with your overall situation.
  2. Understand Options to Move Forward after Relief Programs Expire: Loans that were deferred as part of COVID-related relief program need your attention. Deferments provided borrowers with a little breathing room, but now that the temporary pause in payments has expired, a checkup is a good opportunity to understand options, and take a closer look at not only any loans that were on pause, but also your entire financial picture.
  3. Manage Income and Expenses: One of the best ways to cope with inflation is to take the time to prioritize monthly spending. A spending plan helps to ensure that what you spend doesn't exceed what you make each month as prices rise. A financial checkup gives you a better understanding of your income and expenses. It can also be a time to set a spending plan to keep your finances on track and start saving for future goals.
  4. Pay Down Debt: A checkup is a good time to explore options to help you pay down credit card debt as well as options for managing other debts that may be on the horizon - such as expiring forbearances on mortgages or student loan payments.
  5. Assess Your Credit: Are you looking to take out a mortgage or make another large purchase in the New Year? A checkup is a great time to review your credi treport to see where you stand, and get tips to improve your score moving forward.

Your Checkup Starts Here

Your financial fitness is key to a healthy New Year. GreenPath's caring, certified counselors are committed to easing financial stress and worry through access to clear information.

For more information about financial wellness, visit our partner at GreenPath Financial Wellness.

Greenpath Financial Wellness

• By Kevin Alvarez

Increasing Your Financial Awareness: Recorded Webinar

Learning about personal finances can feel overwhelming or out of reach. This webinar recording provides discussion and tips for more easily manage our finances.

What You'll Learn

  • Ways to take control of your finances
  • Money mistakes you can learn from
  • Practical steps to increase your financial awareness

As a member, we provide you with access to certified experts who will empower you to eliminate financial stress, get out of debt, increase savings, and achieve your financial goals.

Click below to learn more on how GreenPath Financial Wellness can play an important role towards your financial freedom.

GreenPath

• By Kevin Alvarez

How To Raise Financially Healthy Kids

Information brought to you by our partner, GreenPath Financial Wellness

As a parent, you may be wondering what type of conversations you may begin to have in order to develop financially healthy kids. Coming out of the unprecedented year we all endured, it may serve as a good opportunity to begin sharing valuable life-lessons about money.

Here are some tips that will show you how to raise financially healthy kids.

Talk About Money

Let’s change the narrative around money.  You can introduce the concept of money to your kids at an early age.  As your children grow, continue to deepen the conversation and help them understand the concepts of money.

If you're unsure of where to start, you can also ask a trusted friend or family member to have these conversations with your kids.  It’s also ok to let your kids know that you don’t have it all figured out.  Explain the things you’ve done and what you would or wouldn’t do again and why.  Sharing is how we learn!

Involve Your Kids in Major Purchases

Deciding where to go on vacation?  Buying a new appliance?  Include your kids in the process. They can help with the research.  You can show them the factors that go into making the decision.  You can help them compare the options before making the purchase.  Even better, allow your kids to pay for the major purchase.  Imagine how your children will feel knowing they did the research to make the best decision for the entire family.

Teach Your Children Math and Money

Most people don’t learn about budgeting until it’s too late.  Imagine what the future will look like for your children, if you teach them the value of savings today.  Show them how compounding interest works. When you go to the store, could you give your kids a $10 bill and ask them to purchase part of the grocery list?  When could you teach your children about credit?  Could you educate them about how credit cards work before they go to college?

Teach Your Children to Record Their Spending and Saving

Remember the main reason for teaching our children about how to track their spending is to allow them to better understand where their money goes.  More importantly, this allows our children to successfully handle their money and achieve their goals.

Don’t worry, teaching your kids about money doesn’t have to be a daunting task.  If you’re like most people, the hardest thing to do is to start the conversation.  We are here to help.  Share these posts with them, discuss the articles on GreenPath’s site or simply reach out to us for ideas.

GreenPath

SafeAmerica's Youth Program

Set up your children for financial success! Learn about our Youth Program and implement tips from this blog to jumpstart your children with healthy financial habits.

For more financial tips and education, visit GreenPath Financial Wellness.

Youth Program

• By Kevin Alvarez

The 5 Factors That Affect Your Credit Score (And Simple Ways to Boost Them!)

Information is brought to you by our partner, GreenPath Financial Wellness

Whether you’re looking to get your first credit card for everyday expenses or take out a mortgage to purchase your first home, credit is an essential tool for helping people to meet their financial goals.

When applying for a line of credit, the higher your credit score, the more likely you will be to qualify, and the more options you will have available to you.

Here, we’ll breakdown the 5 factors that affect your credit — in order of most heavily weighted to least—and the simple  yet effective steps you can take to give your score a boost.

Understand Your Current Credit SnapShot.

Federal law requires each of the three nationwide consumer credit reporting companies -Equifax, Experian, and TransUnion -provide you a free credit report every 12 months if you ask for it. While these reports don't contain your actual score, they can be very helpful in identifying what might be affecting it (as well as any inaccurate information that may need correcting). Request yours at annualcreditreport.com.

1. Payment History (35%)

Payment history is the biggest single factor used to calculate your credit score. Late payments (even a couple of days), past due accounts, and accounts in collections all have a negative impact on your credit. Regular, on-time payment of the minimum amount (or greater) will improve your credit score. A non-time payment history in the range of 18 months or longer will begin to show results in a growing credit score.

Set up automatic payments.

If your late payments are due to forgetfulness, this is the easiest way to ensure you never miss a future payment.

Change your billing due date.

Suppose you have multiple bills due on the same day of the month. In that case, it may be worth changing your payment due date to align better with your personal situation (e.g.,spacing out bills to make them more manageable, or ensuring your payment date is after an income deposit date.)

Explore hardship/deferment options.

If you’re having trouble making ends meet, call your creditors and request a forbearance or payment deferral. They may also be able to waive late fees or even allow a lower payment for a period of time.

2. Amount Owed (30%)

Your credit utilization is determined by the amount you owe—not relative to your income but, compared to the total credit limit available to you, expressed as a percentage.(For example, if your card balance is $600 and you have a spending limit of $2,500, your credit utilization is $600/$2,500 or 24%.) As a rule of thumb, your credit utilization should be no more than 30.

Quick Tips for Improving Amount Owed:

Pay down your balance early.

If you can make small payments throughout the month, this can help keep your balance down and lower your credit utilization.

Decrease spending.

Find areas where you can cut back on spending to lower your utilization. Our Prioritizing Expenses Worksheet can help you to determine what to cut.

Ask for a credit line increase.

Increasing your credit limit is the simplest way to decrease your credit utilization with out having to cut back on spending.

3. Length of Credit History (15%)

Although not the most heavily weighted category, the length of a borrower’s credit history is important. It’s an indication to the financial institutions what kind of borrower you maybe in the future. In addition to the overall time an individual has had credit accounts open, credit history is also determined by how long specific types of accounts have been open, and how long it’s been since those accounts have been used.

Quick Tips for Improving Credit History:

Get a secured credit card.

Backed by a cash deposit, a secured credit card can be an excellent low-risk way for those who have not had a credit card previously to start building credit.

Keep credit cards open.

Closing a credit card can negatively affect your score. If you have cards you aren’t using, placing a small recurring charge on them (such as a phone bill or streaming subscription) can help to keep the card active while keeping your overall credit utilization low.

4. Credit Mix (10%)

Credit mix is determined by looking at the types of credit you are carrying (this includes credit cards, retail accounts, installment loans, mortgage loans,etc.) as well as your payment history in each area.

Quick Tips for Improving Mix:

Explore loan options that work best for you.

Your credit mix isn’t the most impactful category, and you shouldn’t pursue loans unless they make sense for you and your personal needs. In fact, you may already have a fair credit mix—things like credit cards, personal loans, auto loans, and mortgage loans are all considered different types of credit.

Make sure you pay loans on time.

A good credit mix is moot if you aren’t making timely payments–ensure you are making at least the minimum payments on your outstanding loans each month.

5. New Credit (10%)

Research shows that opening several credit accounts in a short amount of time represents a more significant risk—especially for people who don’t have an established credit history.

Quick Tips for New Credit:

Open new credit accounts only as needed.

Every time you apply for a new credit card,this creates a hard inquiry on your credit,which will automatically lower your score. Having more credit than needed can also encourage unnecessary spending and lead to increased debt.

Understand how hard inquiries show upon your report for different types of loans.

While multiple inquiries over a short time frame for credit cards may result insignificant score damage, other types of inquiries—such as home or auto loans—are reported a little differently. Since lenders know people often shop around, these types of inquiries won’t hit your report for 30 days, and when they do,they’ll be counted as a singular inquiry.

So, there you have it. If you implement these tips, you should start to see a gradual increase in your credit score. Remember: Your credit score is based on patterns over time, with an emphasis on more recent information. Improving credit won’t happen overnight, but with persistence and consistency, your score should gradually improve over time!

Free Credit Report Review

Need some extra help navigating your credit report? GreenPath’s NFCC-certified credit counselors can walk you through a free review of your credit report. They’ll explain how to read the report and help you to make a plan for managing your credit score to support your goals.

Learn More

• By Kevin Alvarez

Why Credit Matters!

Information brought to you by our partner, GreenPath Financial Wellness

Understanding your credit is easier than you may think. Building it properly has it's benefits. It can help with everything from buying a car, house, to getting a job. Yes, even a job. That three-digit number can be important building block in establishing a solid financial foundation.

Sometimes, the unexpected can happen; like a pandemic, a temporary loss of income, or an illness. Improving your credit may take time and patience, but it is worth it. If you have run into a bump in the road or experienced hardship in your finances, there are programs to help.

Why Is A Good Credit Rating So Important?

Juggling your credit is possible with planning and knowledge to get a better handle on your financial future. it is helpful to understand how it can impact you, your family, and your goals for the future.

Credit scores are increasingly important as the economy continues to recover, and more people apply for loans, rent, and buy homes. Banks and other lending institutions use your credit scores to decide who is a good risk based on their previous financial history.

Having A Good Credit Score Can Save You Money!

What does this all mean? A good credit score is part of a path to provide opportunities you may not otherwise be able to access. Lower interest rates are offered to people with better credit scores - that means more money staying in your pocket. It's also easier to get a loan or line of credit. Many companies require at least a fair credit rating before they will even consider doing business with you.

How Is Your Credit Score Determined?

Your FICO score (Fair Isaac Corporation) is a three-digit number based on the information in your credit reports. It helps lenders determine how likely you are to repay, and how much it will cost (the interest rate).

When you apply for credit, lenders need a fast and consistent way to decide whether to loan you money. In most cases, they'll look at your FICO Scores which track history with credit card debt.

There are several factors that help determine your credit score. Understanding them can get and keep you on a great path.

Payment History (35%) - Are you paying your bills on time? Keeping up with your payments and having a history of doing so, is a big factor in your credit score. If you've fallen behind, or need to get back on track; you can set up automatic payments, set reminders, maintain a monthly budget or savings plan.

Amounts You Owe And How You Use Available Credit (30%) - Know your credit limit and keep your balances low (30% of available credit or less).

  • If your balances are high, create a proactive plan to pay them down.
  • As you are working to pay down balances, stop using the card altogether, Also, instead of paying the minimum, increase your monthly payment.

Length Of Credit History (15%) - How long you have gad a line of credit open can help you.

  • Review your credit report to see how long it has been open.
  • Keep accounts active. If possible, keep older accounts active, without interest charges.

Types Of Credit You Use And Your/Credit Mix (10%) - it's important to have a combination of revolving accounts and installment loans. This shows your ability to responsibly handle different types of loans like auto loans , personal loans, or student loans.

New Credit/Having Too Many Lines Of Credit (10%) - Opening an account is certainly alright. Opening five accounts at once, not so much, when you apply for credit remember:

  • Applications for new credit stay on your account for two years.
  • When you do apply, it can cause a slight dip on your credit score.
  • Remember it is important to handle any new accounts responsibly to avoid more significant impact to credit.
  • If you are taking on too much credit, it could signal you are having financial issues.
For more Financial tips and education, visit GreenPath Financial Wellness.
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