SafeAmerica Credit Union

Saving money

• By Kevin Alvarez

Paying Down Debt Is Saving — America Saves Week 2023

Making the decision to pay down debt, particularly consumer debt, can be mixed with emotion. You feel good about choosing to take concrete steps to pay off balances on credit cards, auto loans, student loans or other installment loans. On the other hand, you feel less positive about the amount of money you are directing into a savings account. Well, we’re here to show you how reducing debt is a form of saving, to give you strategies for the best way to do so that align with your personal situation, and to boost your financial confidence to keep you working toward your goals.

As you pay off your debt you are freeing up money, allowing you to direct those funds toward saving for something else that’s important to you – perhaps an emergency/opportunity fund, a vacation, home purchase, or retirement. This money is freed up as you spend less on interest, and possibly late fees, and lowering the debt balances themselves.

If you have more than one debt you want to pay off, for example an auto loan and a credit card balance, there are two main strategies to help you decide which debt to pay off first.

  • The snowball method focuses on the balances of each loan. In this strategy, you make the minimum payment on all your loans except the one with the smallest balance. With this loan, you put as much money as you can toward it and when it is completely reduced you allocate that money to the next smallest balance. Your confidence gets a boost every time you see an account balance at zero.
  • The avalanche method focuses on the interest rates of each loan. In this strategy, you pay the minimum payment on all your loans except the one with the highest interest rate. You apply any remaining money you have for debt repayment to the highest interest rate loan. By paying off the debt with the highest interest rate first you reduce the overall amount of interest you must pay.

You choose which method is right for you and your situation.

Once you are on a path to reducing your debt, reflect on the type of relationship you have with credit. Credit is a tool. When used wisely and with purpose, credit can help you achieve your financial goals and build financial confidence. Having a clear view on when and for what purpose you use credit is the foundation for a positive relationship.

Sometimes we’re told that there are good types of debt (home mortgage) and bad debt (credit cards). This type of categorization is based only on the financial aspect and not the personal situation you are dealing with. It may feel better to ask yourself if the type of debt you are taking on is a good decision for you or not.

For example, when an emergency expense crops up and it is large enough that it will deplete all or nearly all of your emergency savings, you may feel like you’re on shaky ground if another expense crops up before you can replenish your savings. So, you may weigh this option against using a combination of savings and credit based on what feels best for you in the situation.

Making purposeful choices about credit, something that you plan for financially and mentally, can help you build more financial confidence.

You can use the America Saves Spending and Saving Tool to calculate how much you have available for debt repayment, take the America Saves Pledge to make a plan for this repayment, or listen to the ThinkLikeASaver Podcast for even more tips.

SafeAmerica Credit Union is here to help you on your saving journey. Check out all the Savings opportunities we have to offer.

Savings Accounts

• By Kevin Alvarez

Saving Automatically – America Saves Week 2023

Do You Ever Find Yourself Wondering If There Is A Magic Formula To Saving?

Does it seem that everyone around you knows the secret to saving successfully except you? It’s not unusual to feel unconfident about saving, no matter how much money you earn. Confidence doesn’t necessarily come with having a lot of money. Rather it comes from building healthy financial habits and using the resources you know are available to you – this is your financial confidence!

A great place to start building your financial confidence is to set up automatic savings. When you are saving a dedicated amount of money every week, every month, or on some other regular interval, you can begin to feel a sense of control over your saving habits. Whether you are saving just $5 or $10 a month or more, it’s the fact that you’re doing it automatically that is important.

Saving

Saving automatically is the formula for successful saving for anyone – including you. Getting started doesn’t have to be a hurdle either. Consider which one of the following two strategies would work best for you and follow the steps we’ve outlined.

  1. Instructing your employer to split your directly deposited paycheck into two or more accounts at your financial institution with one account being a dedicated savings account.
  2. Directing your financial institution to automatically transfer money into your savings account.

For option #1, contact your employer’s payroll department to set up split deposit, telling them how much you want to save per paycheck, and follow their instructions.

If you want to use option #2, contact your bank or credit union telling them when and how much money you want automatically transferred into your savings account. As a member of SafeAmerica Credit union, you can enable automatic transfers between accounts by logging into online banking and setting up a recurring transfer within the Transfer Money tab. Just set it and forget it!

By utilizing either of these automated saving methods you can feel confident about building a healthy habit of saving. Imagine how good it will feel to see money accumulating in your savings account on a consistent basis. Instead of that voice in your head telling you that saving is hard, you’ll be able to say with confidence, “I am saving regularly!”

America Saves has a number of resources that can help you get started saving automatically: 

  1. The Spending and Saving Tool to help you get a clear view of your finances and determine a realistic amount you can save regularly.
  2. ThinkLikeASaver podcast where you can learn about making saving easier, saving in spite of inflation and many other topics designed to support your saving habit.
  3. The America Saves Pledge, which can help you make a saving plan and receive ongoing support through emails and text messages

So, remember your unique financial situation calls for you to make the choices that will work best for you and your family, which will ultimately increase your financial confidence and help you continue making informed choices throughout your saving journey!

SafeAmerica Credit Union is here to help you on your saving journey. Check out all the Savings opportunities we have to offer.

Savings Accounts

• By Kevin Alvarez

Saving Money Isn’t a Luxury – It’s a Necessity

Information brought to you by our partner, GreenPath Financial Wellness

4 Reasons to Start Saving Now - Plus Tips for Getting Started

Saving money can often be a challenge — especially during times of financial uncertainty. As humans, we’re wired to take care of our needs now, and worry about later ... well, later. However, saving money is a critical component of financial wellness. Here, we break down why saving (even a small amount) can make all the difference:

Saving Helps to...

Prepare us for emergencies

Putting aside a set amount each month helps protect us in a financial emergency. Perhaps it’s a surprise medical bill, car repairs, or temporary loss of income. There are many reasons why an emergency fund is critical to help handle unexpected expenses. Plus, building up emergency savings to cover unexpected expenses is better than using high-interest credit cards or taking out a loan. An emergency fund gives you peace of mind and prevents you from going into debt.

Set us up to manage planned expenses:

For those anticipating making large purchases, saving money can help us prepare our budget to pay for expenses that we plan to take on–such as a down payment on a car, home improvements, or an upcoming vacation. Emergency savings are also useful for smaller cash outlays like costs for pets, car maintenance and other important bills Here again, by saving up for planned purchases whether they be the significant expenses or lower cost items, we can avoid using high-interest credit cards or taking on other debt. When you plan ahead, you take control of managing your monthly income.

Reduce Stress:

Financial stress is real. It can be overwhelming to have bills and expenses that we struggle to pay each month. In fact, many researchers see a significant connection between financial stress and mental health and well-being. During the ongoing pandemic, financial strain is felt by the newly unemployed, furloughed, and those still working but facing an uncertain future. When you build up savings, you reduce the stress many of us feel about our finances and give yourself a gift–peace of mind.

Provide a sense of freedom:

Gaining a sense of freedom might not be the first reason that comes to mind as a benefit of setting up a savings plan. Yet many of the people who contact GreenPath Financial Wellness report enjoying a sense of improved freedom and flexibility after building up savings, no matter the amount. Setting aside even $20 a paycheck is proven to provide a feeling of freedom due to the "buffer" savings "nest egg" exists gives people more freedom to choose how to handle their finances, rather than feeling stuck in a particular situation.

 

How to Jump-Start Your Savings

1. Assess your budget.

Use GreenPath's Budgeting Worksheet to get a  handle on your monthly income and typical expenses, including credit card debt or other loan payments.

2. Commit to a monthly savings amount.

Once you have a complete picture of monthly income, expenses, and debt, consider how much you can set aside each month to build up savings. How much you set aside will depend on your financial goals. For instance, if you're planning for a large purchase, break down the amount over a 6 month or 12-month period, and automate savings to meet that goal.

3. Automate your savings.

Automating your savings makes it more "painless." You'll be able to set it and forget it, by paying yourself first through automated deposits.

4. Maximize Interest

Ensure you're maximizing the interest you're earning by getting a competitive annual percentage yield (APY). Consider a money market or other higher interest account.

5. make it a family affair.

Setting a savings goal with loved ones lets you come to a consensus about goals and dreams. That way, it is easier for you all to plan and encourage each other to save for emergencies, planned expenses, or other goals.

Saving for your future is closer than you think.

Building savings can seem like a daunting task, but you will start to see results with practice and patience.

If you're unsure how much you can reasonably save each month or need a helping hand getting started, you can request a free financial health assessment with a GreenPath NFCC-certified Financial Wellness Expert.

Our professional, caring coaches will work with you to assess your situation, explain the options or solutions available, and help you create a plan to meet your goals. It's free, confidential, and no pressure.

For additional insight view an on demand webinar: 10 Ways to Start Saving Money.

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• By Kevin Alvarez

What to Know About Financial Hardships

Financial stress can be a very uncomfortable issue to deal with. The process of regaining financial control seems like a steep climb but as with any problem, finding guidance with your financial hardship can provide the framework towards regaining control.

If you're struggling to pay your bills every month, you might be dealing with a financial hardship.

What is a Financial Hardship?

A hardship can be defined in a few different ways and usually depends on a number of factors.  Typically, a hardship refers to a situation in which you cannot keep up with your financial obligations due to a circumstance that is beyond your control.

What Causes a Financial Hardship?

There are many reasons for a financial hardship and more often than none, they happen to be a result from an uncontrollable life circumstance. Some of the common reasons for a financial hardship include:

  • Loss of job
  • A cut in hours or pay
  • Divorce of death of a spouse
  • Injury or medical illness
  • Unexpected events/family matters

Common Signs

There are also a handful of identifiers that can serve as a warning that you may be headed for financial distress such as:

  • Not making the minimum payments on financial obligations
  • Continuously making late payments
  • High credit utilization (high credit balances)
  • Using services as payday loans and/or cash advances
  • Using credit to pay for daily essentials
  • Lack of emergency funds

Acting on the warning signs will serve as a preventative strategy that will allow you to plan, organize and eliminate the possibility of falling into a financial nightmare. Simply doing the corrective measures of the previous mentioned warning signs will place you into a better financial position.

Financial Hardship

What To Do

If you experience a sudden change of income, it is often recommended to create a baseline budget that will cover all of your priorities. Writing out your priorities, in order of importance, and labeling them as such, will provide understanding on which priorities have a certain amount of flexibility. While it is never easy, making the needed budget cuts will allow you to keep the baseline income flowing into your priorities.

Speaking to your lender/financial institution about your specific circumstance will help determine the best solution for you and can provide some financial relief when it’s needed most. There may also be other programs and resources in your community that could be taken advantage of.

SafeAmerica Can Help

As a member of SafeAmerica Credit Union we have resources available to assist you.

Begin the process of a healthy and stress-free financial way of living through our nonprofit partner, GreenPath Financial Wellness. They can assist with:

  • Creating a debt management plan
  • Financial Counseling
  • Housing Services
  • Student Loan Counseling
  • Credit Report Review
  • Financial Education
GreenPath Financial Wellness

Financial hardships are deemed as a last resort resource and are not structured to be supplemental to any variations of money saving methods. To increase the possibility of being accepted for a financial hardship, one should be able to provide details and/or documents from resources they took advantage of before making contact for a financial hardship.

Important Links

GreenPath Financial Wellness
Foreclosure Prevention Strategies
Financial Hardship Assistance

If you need insight, guidance or a plan of action with your SafeAmerica Credit Union loan, our collections department is available at CollectionsDepartment@safeamerica.com.

• By Kevin Alvarez

How to Plan for Back to School Expenses in a Time of COVID-19

Information brought to you by our partner, GreenPath Financial Wellness

As families track the latest news about their communities K-12 reopening plans, it’s clear this is a school year like no other – especially as families plan for back to school expenses.

Will students return in the classroom? Will a K-12 student school year involve a mix of online and in-class learning? Or will school districts mandate that the school year be online, virtual learning?

A national organization that monitors retail activity shows that households tentatively plan to spend a record amount to prepare students for school and college. If districts aren’t providing laptops, many families will buy laptops and computer accessories in anticipation that at least some classes will take place online because of the coronavirus pandemic.

The retail survey shows that parents with children in elementary school through high school anticipate spending an average of $789.49 per family, topping the previous record of $696.70 they said they would spend last year.

While it isn’t a typical year when it comes to back to school shopping tips, with the right information, families can reduce their stress.

6 Steps to Plan for Back to School Expenses

The good news is that with a little planning, you can successfully manage additional expenses even in the midst of a pandemic.

As you plan for back to school expenses, shared here are six steps you can take.

1. Check in with your school district.

Whether preparing for online or in person, be sure your spending plan reflects what technology tools might be needed. Watch the news or local websites to keep tabs on what your district is planning for back to school. Check with your district if they will be providing school-aged children with laptops or other technology.

2. Think about your spending plan.

The pandemic has changed household finances, given unexpected loss or changes in monthly income. GreenPath’s budgeting worksheet is a great way to get a handle on the situation in terms of tracking income against expenses. Once you have a good handle on your current financial state, determine how much you truly feel comfortable spending.

3. Is it a “want” or a “need?”

Prioritize your needs list. What do you need to buy before school starts and what can you purchase later?

When thinking about virtual learning, does the family already have access to high-speed internet and a family computer, or are these items that need to be purchased? Will your district provide needed technology? What really needs to be replaced or what can be reused?

If new clothes are a need, watch for sales or online stores offering the most competitive pricing.

4. Avoid impulse buys.

Whether heading to the computer store to support online learning or buying a new backpack, stick with the plan.

Make it a family affair. Write out the shopping list together. If the kids want something that isn’t in the budget, offer them the option to chip in their own money.

Look at school shopping as an opportunity to get kids more involved or even suggest spending more of their own money on back-to-school supplies.

5. Watch those credit card balances.

If you use a consumer credit card, keep a close tab on the balances. This can be a simple process of assembling printed receipts in an envelope after each shopping outing. That way you’ll have a clear reminder of the credit card balances as they are incurred.

6. Consider teaming with a helpful resource.

Families looking for additional support before they head to the stores this fall have another option.

GreenPath’s professional, caring Financial Wellness Experts will assist you in assessing your financial situation and guide you to create a personalized plan to achieve your goals.

GreenPath works with thousands of people each week to pay off debt, improve credit, and lead a financially healthy life. When looking ahead to an uncertain school year, it’s helpful to start a conversation with a GreenPath a Financial Expert.

• By Kevin Alvarez

7 Things To Consider When Buying & Selling a Home Simultaneously

Information brought to you by our partner, CU Homeland/American Pacific Mortgage

There may be no greater example of multi-tasking than when you’re buying and selling a home simultaneously. It can feel like you went from 0 to 100 in no time flat! Whether you’re chomping at the bit to get settled into your new home or ecstatic about the price you secured for your current home, we know you have plenty of activity to go around.

So take a little time to get organized. Buying and selling a home simultaneously may seem overwhelming, but many people successfully navigate this balancing act not once, but a few times over the course of their adult lives!

1. Prepare, Prepare, Prepare

You’ve found the home of your dreams and you’re ready to kiss your old digs goodbye. There’s only one problem: your current home needs some work. The last thing you want to do is find yourself under contract to buy a home when your current home is not ready to hit the market.

So start early. Take stock of all the maintenance and repairs that need to be addressed, and get rolling on these ASAP. Remember, too, that markets cool. You may not secure the same price in December as you did in June, which makes timing all the more important when you’re buying and selling a home simultaneously.

2. Find Someone Licensed in Your Area

You may have loved the realtor and lender who helped you buy your current house. Unless you’re looking to move down the street, however, you’ll want to find licensed professionals who work in your desired area. This is especially important if you’re relocating to another state.

On the other hand, if you’re staying in the same area, it can be advantageous to use one realtor and lender when you’re buying and selling a home simultaneously. Professionals who are privy to the timing of both transactions can ensure a smooth transition as you move from one home to another.

3. Have a Backup Plan

Deals fall through. It’s just a fact of life. This can be twice as painful if you’re buying and selling a home simultaneously. Even though it’s not fun, this is the time to think and prepare for worst-case scenarios. Create an emergency fund, call movers and storage units to determine a Plan B for your belongings if you need them to be held temporarily, and make a list of hotels and short-term rentals before you may need to use them.

It always helps to have cash on hand as well. This can assist in smoothing out any last-minute snafus with movers or short-term rental agencies.

4. Temper Expectations

Some people use the funds from their home sale for the down payment on their new home when they’re buying and selling a home simultaneously. This can be done, but you should always keep your home-selling expectations realistic, especially if you’ve already earmarked that money for a new home.

We all know what our homes should be worth, but “should” and “are” are two different things. Your realtor can help you keep expectations in line so you don’t wind up with a down payment that is $30,000 less than you imagined. At the same time, you want to also be prepared in case the market softens and prices drop a bit. It’s best to operate off the assumption your home will sell for less than you expect, that way you have a little cushion if pricing is better than you imagined.

5. Compromise Whenever Possible

It’s easy to feel that we have all the power when we’re on the buying side of the equation. If you're buying and selling a home simultaneously, however, you’re seeing the sale from both sides of the fence.

So try to keep a good perspective. Us buyers can often feel entitled to an extra week of escrow, a few small repairs or some money off if we ask for it. After all, we’re the buyers! But keep in mind that your home also has buyers who may need a little time or a few concessions. Patience goes a long way, especially if you're buying and selling a home simultaneously!

6. Consider Contingencies

A backup plan is one thing; a contingency plan is another. The difference between the two lies in perspective. While a backup plan can handle worst-case scenarios and everything in between, a contingency plan deals with “if this, then that.”

For example, a rent-back contingency can allow you to rent your sold home back from the buyer for 30 to 60 days after closing. A rent-back contingency is typically used when you want to accept an offer on your house but you don’t have your next house lined up. Of course, even with this contingency you want to be mindful that you’re working on a deadline, but these types of agreements can provide some wiggle room if you're buying and selling a home simultaneously.

You can also make a contingency offer. This occurs when you put in an offer on a new home, but closing is contingent on securing a buyer for your current home. A home sale contingency can be great if you're buying and selling a home simultaneously, but it may also cause the seller to consider other offers. Your realtor can provide more guidance on whether this is the right move for you.

7. Review Financing Options

There are a variety of options out there if you're buying and selling a home simultaneously. If you don’t need the funds from your home sale to purchase your new home, then you can move forward with fewer strings attached. That’s not the case for a lot of us, however.

Fortunately, there are options and programs that can help. You can purchase the new home with a HELOC, or home equity line of credit, which lets you borrow against the equity in your current home. Bridge loans are another short-term option that can cover your down payment until your home sale closes. Some people choose to rent out their old homes if they’re not ready to sell, which can offset the mortgage while buying you some time.

Working with more than one home on more than one transaction can make it feel like you’re juggling above your talent level. It doesn’t have to, though. If you align yourself with the right professionals, take some time to prepare and think through the various scenarios and come into these negotiations with an open-mind, you’ve set the stage for a successful home buying and selling process.

We’re happy to help when you’re ready to start. As a SafeAmerica Credit Union member, you have access to CU Homeland/American Pacific Mortgage; our partner for all your home loan needs. Click below to learn more about the loan programs available to you or to get a rate quote.

Find a home loan solution here

• By Lisa

Managing Debt in the Time of COVID

Information brought to you by our partner, GreenPath Financial Wellness

In the early weeks of the pandemic, understanding the economic impact of the crisis was on the minds of most of us. A specific concern was managing debt in the time of COVID.

The roll-out of forbearance programs as part of the CARES Act gave relief to millions of households and gave Congress time to bolster unemployment benefits and offer emergency aid to businesses.

For those managing debt in the time of COVID, it was helpful to work with creditors to temporarily pause payments toward credit cards, mortgages, auto loans, federal and private student loans and other monthly payments.

These options provided relief and stability to many people during an uncertain time.

Fast forward several months, and many of these forbearance programs are nearing their expiration dates. Lenders are now set to decide whether to continue letting people delay paying off debt including credit cards balances, personal loans and car payments.

LEARN MORE ABOUT DEBT MANAGEMENT PLANS

If you are having trouble paying off your credit card debt and/or other debt, a debt management plan may be a good option.

Learn how they work >>

As the pandemic crisis continues, having a clear set of options can help us feel a sense of confidence when looking at family finances. Here are some ideas to move forward as deferrals and forbearance periods are set to expire:

1. Review the Programs

There’s a lot to know about the ins and outs of deferrals, and student loan deferment and forbearance.

For people who participated in credit card deferrals, contacting your lenders to obtain a review of the terms of the deferrals is helpful.

The information is a good reminder as to the terms of the repayment options and deferral time period.

For those who delayed monthly mortgage payments as part of the CARES act, it can be helpful to review the terms of the original programs.

The Conference of State Bank Supervisors provides an in–depth guide entitled the “Consumer Relief Guide – Your Rights to Mortgage Payment Forbearance and Foreclosure Protection Under the Federal CARES Act.”

The idea is to connect with information so you can make strong decisions about your future.

2. Stay Current

To help manage the uncertainty, it is also helpful to stay current with information related to any changes in forbearance and deferral expiration dates.

At this writing, the temporary delay in paying off personal debt is set to expire around the end of July for some creditors. A few big lenders are extending deferments by several months.

There could be changes to the timing, so staying current with the latest news and information is a good option for people who will need to start making payments again.

When managing debt in the time of COVID-19, Consumer Financial Protection Bureau is a good source of trusted information and publishes recent updates.

3. Team with Caring Counselors

As the temporary pause in payments sets to expire, it is a good opportunity to understand options, and take a closer look at not only any loans on pause but also your entire financial picture.

GreenPath’s NFCC-certified counselors help you begin a conversation about where you are today, and what you need to keep in mind when managing expiration of deferrals and forbearance.

For many, it’s a smart way to pay off your debt. Caring, compassionate counselors guide you through a process to assess your financial situation, understand your goals, and create an action plan to work toward them.

You might have questions as to what’s ahead. We listen with respect, offer advice and information, and suggest options that could help you meet your needs.  Request a call with a financial expert >>

As a SafeAmerica Credit Union member, you have access to GreenPath Financial Wellness; a free financial counseling and education resource.  We encourage you to take advantage of all they have to offer.

Learn More about GreenPath

• By Kevin Alvarez

Saving Money with an Auto Loan Refinance

We’re all looking for ways to save where we can. Refinancing your auto loan can be an appealing way to lower your auto loan costs. Now is a good time to re-evaluate your finances and find ways to save money. Given the current state of events, many lenders are offering great rates and specials on new auto loans (among other things). It’s the perfect time to see what’s available for you, and most importantly, what can save you money.

My neighbor said an auto refinance was a bad idea, is that true?

Can I save money on an auto loan refinance? What does it take to refinance an auto loan? Is it really beneficial for me?

There are many questions and things to consider but individual credit status is one of the most important deciding factors for getting an auto loan refinance. So to compare with someone else means you are assuming their credit status as your own.

According to Credit Karma, below are some things to consider when looking into easing your finances with an auto loan refinance:

What does an Auto Refinance do?

  • Refinancing means you pay off your current auto loan with a brand new auto loan
  • Based on your credit, it could immediately help free up some of your debt
  • Extending your term means paying more interest, but with lower monthly payments, providing the instant financial relief

What YOU should do

  • An auto refinance serves people differently and is beneficial when you need instant savings
  • Find rates that are lower than your existing auto loan
  • Be aware of your current credit score, any improvement means refinancing will cut your monthly payment
  • Be aware of vehicle criteria lenders may have
  • Know your term and what length works best for your budget
  • A tighter budget means longer terms to pay your loan, but in an affordable manner
  • Know how much you owe on your auto loan and your vehicle’s current market value
  • Be aware of any refinancing fees
  • Understand if your auto loan has any penalties for paying it off early
  • Make sure to have all necessary legal documents readily available
  • Be aware of both hard and soft inquiries when browsing around
  • If you must get multiple hard inquiries done, aim to do so in a span of 14 days. This may only count as a single hard inquiry and not as multiple.

As a member of SafeAmerica Credit Union, you can refinance your auto loan and take advantage of:

  1. Great Rates
  2. Flexible terms
  3. No payments for 60 days

Apply online below and try our payment calculators to see if an auto loan refinance can benefit you.

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