Archive for the ‘ Interest ’ Category

Pre-approved Auto Loans


Before you shop and get your heart set on a certain make and model, wouldn’t it be nice to know exactly how much car you can realistically afford? With a pre-approved auto loan, you can shop  and feel good about that potential purchase and how it will impact your budget.

little_car_on_money2Buying a car is typically the second-largest purchase you’ll make after a house. Like with any loan, you’re going to have monthly payments. Those payments mean a fixed payment, every month, at the interest rate you qualified for based on your credit history, for a certain length of time. If you can’t afford those payments down the road, you could end up losing your car or may have to sell it and start over to get something more affordable. A great perk of a pre-approved auto loan is that it helps you figure out how to fit that monthly payment into your current budget. It also gives you time to make any necessary adjustments. Use our financial calculators to help you work out your numbers.

Having a pre-approved auto loan transforms you into a “cash buyer” and in turn, puts you in the driver’s seat  when you’re at the dealership. It will help you be in a better position when negotiating your purchase and will help you stay on track because you already know exactly what you can spend. Be sure that while you are shopping and looking at the prices that you keep in mind that there will be sales tax and other fees that will go into the deal before you can drive away. And, if you have a trade in, that could be a plus or you may choose to sell your current vehicle yourself. In any case, keep your potential trade in well maintained, cleaned and  have an idea of its current going rate by checking out its Kelley Blue Book value or through Edmunds.com.

 Ready to get started? A Members 1st Pre-Approved Auto Loan allows you to lock in your rate for 30 days until you make your decision. All rates are based on the model year. We offer a variety of terms to suit your needs. Check out our auto loan rates today and get ready to apply.

Note: Be sure to ask us about Member Value Protection. This is optional  coverage you can elect to have when you apply for your loan. It gives you the peace of mind of knowing that your monthly loan payments will be cancelled in the event of death, disability or involuntary unemployment.

Lose Some Debt Weight in 2015


So many bills!

 

Do you have multiple department store or gas cards that you never use? Do you pay annual fees for cards that never see the light of day?  Maybe it’s time to clean out your wallet and lose a little debt weight this year. Here are some tips:

PAY. If you have numerous credit card balances, tackle the one with the highest interest rate first and pay the minimum amount required on all of your other balances. When that one
is paid off, consider rolling that amount into the next highest credit card balance (old amount plus the minimum payment required).

TRANSFER. Consider transferring your higher rate credit card balances and loans to a Members 1st VISA®, which could save you money! Take advantage of our 1.90% APR VISA® Balance Transfer option. Call (800) 283-2328, ext. 6040, visit a branch or log into Members 1st Online » Card Services » VISA® Balance Transfer. This offer is available on balance transfers received through June 30, 2015.*

CHOOSE. Figure out which card you’ve had for the longest amount of time. Make sure to keep this card open, since lenders often see borrowers with short credit histories to be riskier than those with long credit histories. Determine one or two cards to utilize regularly and leave the rest at home. If you have a card that has a low-interest rate or offers rewards, it may be best to keep it open. It’s alright to close those credit cards that you’re no longer using, as long as they don’t have balances and you have other cards.

FOLLOW UP. If you choose to close a credit card, make sure to send a letter to the issuer sharing your decision. Double check your credit report to see if the card is reported as “closed.”

*The 1.90% Annual Percentage Rate (APR) on Balance Transfers using the specific form or online submission is a “Discounted” rate that will be in effect from the time of the posting of the balance transfer to your card account for six consecutive billing cycles afterwards, which will be considered the promotional period expiration date of that specific balance transfer. After the expiration of your “Discounted” rate the remaining unpaid portion of the original balance transfer request will be subject to your normal APR as outlined on your monthly statement based on the specific Members 1st FCU credit card selected. Consumer Cards (Business Cards are ineligible) may have up to 10 individual balance transfers open at any given time period. If you default through becoming 60 days or more delinquent we may increase your APR on the balance transfer and other balance amounts as defined within the cardholder agreement and disclosure, which is provided upon card issuance and available online at http://www.members1st.org. All payments received on your account in excess of your minimum payment requirement will be applied first  to the highest rate balances, secondly to the lowest rate balances and finally  to new purchases. All rates are effective as of January 1, 2015 and this offer may be withdrawn at any time. Other restrictions or conditions may apply. You may not pay off your current Members 1st loans or lines of credit by using this balance transfer option. For current rates, fees and other cost information, please reference the Visa Balance Transfer disclosure or contact the Members 1st FCU Card Services Group at (800) 283-2328, ext. 6035. We do business in accordance with the Federal Fair Housing Law and Equal Credit Opportunity Act.

 

Saving for the Future? Start now!


Piggy_Banks_red_xxlThe earlier you start saving, the more you’ll benefit from compounding interest. This is the interest earned on interest payments already built up in an investment fund. The earlier you start, the larger your nest egg will grow.

Here’s an example for you. Two friends – Tracy and Jason – had different savings strategies. Tracy saved $1,000 a year for 10 years, starting at age 25. Jason saved $1,000 a year for 25 years, starting at age 40. Both earned the same 8 percent return.

Who ended up with more money at age 65? It had to be Jason, right? Wrong…Tracy benefited from her early start and the power of compounding. Here’s the breakdown (totals assume $1,000 savings is made at the beginning of each year):

Tracy: Began saving at 25 and saved for 10 years. She’s now 65 and has saved $10,000. Her savings grew to $157,437

Jason: Began saving at 25 and saved for 10 years. He’s now 65 and has saved $25,000. His savings grew to $78,954.42.

Need to talk to a financial counselor about saving money? As a member of our credit union, you can take advantage of the GreenPath program, a free financial education and counseling program. Call GreenPath at (877) 337-3399 or visit http://www.greenpath.com. GreenPath counselors are available Monday through Thursday from 8 a.m. – 10 p.m., Friday from 8 a.m. to 7 p.m., and Saturday from 9 a.m. to 6 p.m. (EST).

Wondering how the interest thing works?


guy looking out window wondering
Recent years have shown all kinds of economic challenges. From the Wall Street debacle and the mortgage meltdown to ongoing zealous greed across the spectrum, consumers have paid the price in more ways than one – and unfortunately may continue to do so for a long time.

The Congressional Budget Office (CBO) isn’t offering a warm and fuzzy economic outlook for 2014. Consumer spending was up in the last quarter of 2013 yet we’re all at the mercy of inflation and the declining value of the US dollar against other world currencies. Our national debt stands at $17 trillion as reported recently in USA Today. Imported goods are becoming more and more expensive; food and energy prices keep going up; medical and education costs keep rising; the national unemployment continues to hover around 7 percent; and then there’s that healthcare fix.

It’s enough to keep us all shaking our heads and wondering about how we’re going to make ends meet, save money, and what it’s going to cost to borrow money. We wonder if, when, and how we’re going to make more money when everything seems to always be costing more.

With economic instability, ongoing political deadlock, and government mistrust, it does appear that it’s going to be standing still for a while longer. The Federal Reserve says that interest rates may stay low through 2015 and beyond.

How exactly does this interest rate thing work? The Federal Reserve (the Fed) is responsible for the stability of our financial system. In order to maintain that stability, it either raises or lowers interest rates on a fairly routine basis. When the economy is booming and companies are seeing profits, the unemployment rate is low and you’re out spending money, short-term rates are raised to keep the economy from building too fast. When that happens, we experience inflation – prices go up when there’s too much money and too few goods and services. The Fed raises interest rates to slow things down and that means low rates go up.

The Fed lowers short-term rates when the economy is slowing, making it less expensive to borrow money. That means you have more money to spend elsewhere and that speeds up the economy. Recessions occur when consumers become tight-fisted with their money and don’t buy products and services to keep companies thriving and workers employed. Throw in an international incident involving oil-producing nations and interest rates could be affected.

Many of you ask why our savings rates can’t be higher. They’re all part of the big picture painted by the Federal Reserve. Credit unions and other financial institutions just can’t set rates on a whim. The Federal Reserve sets forth certain requirements for all types of financial institutions. What’s going on nationally and internationally affects us and ultimately you as a saver or a borrower. When interest rates are high, your money makes money for you, but at the same time, you’re going to pay more to borrow. Unfortunately, when rates fall, your money makes less money, but should you need to borrow, it’s a lot cheaper for you.

We understand that this prolonged period of low-interest rates has caused many challenges for those of you who have saved and saved your entire lives hoping to cash in on the interest accumulated in your savings to help supplement your retirement income. Unfortunately, like you, we’re at the mercy of these big picture conditions and requirements.

Keep in mind that we do have a variety of short and long-term savings options for you. Determining your savings goals or revising existing ones may be necessary for savings success. Now is the perfect time to take a good look at your financial picture to see how you can get the most out of your savings in 2014 and beyond.

Republished from our “Avenues” newsletter, “A Word From Bob”, March/April 2014.

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