September 2021 - High Point FCU

How do I Raise my Kids to be Financially Independent Adults?

Q: How do I help my kids become financially independent grown-ups?

A: Teaching your kids how to be financially independent will help smooth the transition into adulthood. It will also give them what they need to stay financially stable throughout life.

Here are some tips for raising kids to be financially independent adults.

Start with basic budgeting

Introduce your children to the concept of earning money and spending mindfully when they’re young, and build upon that as they grow up. Preteens can watch you work on an actual budget, and teens can even assist you in creating a budget for a large expense, like a family vacation. You can also help kids create a budget for how they plan to spend their own money.

Split the costs of “must-have” items

If your children are like most kids, they’re asking you for trending items they claim they must have; from a pair of designer jeans to the latest fad toy they insist everyone else already has.

A great compromise is to have your child pay half the cost of expensive trending items. They’ll likely quickly see that a “must-have” really isn’t when you’re footing half the bill.

Teach them about credit cards

If your child sees you using a credit or debit card often, teach them what’s behind that card. Show them your credit card bill when it arrives and talk about how you need to pay for all those expenses during the month, plus the possible interest. Teach them about debit cards, too, explaining how money is withdrawn from your checking account each time you swipe the card. You can also give older kids a quick rundown on credit scores, how they work and why they’re so important.

Talk openly about what they can expect in terms of support for the future

When your child is mature enough to talk about the future, discuss how much financial support you plan to offer while they attend college, immediately after graduation and into their adult years. Ask about their plans as well, paying attention to when they anticipate being financially independent.

You can bring up the topic of career paths, too. Help your child determine a basic budget for the lifestyle they plan to lead and assist them in narrowing down their career choices until they have just a few that will support their future life. Talk about student loans, too, and explain how crippling debt can be.

If you haven’t already, consider opening a Youth Savings Account for your child at High Point Federal Credit Union. This way they can get hands on experience with a financial account and understand the importance of putting money away. If they get an allowance, or are gifted money at some point, you can encourage them to put a certain percentage in their account. Stop by one of our branch locations, contact us, or call 800.854.6052 to discuss opening a Youth Savings Account.

Use the tips outlined above to help raise your child to be a financially independent adult.

Beware of Gift Card Scams

Everyone loves gift cards. Unfortunately, scammers also love them, and for all the wrong reasons. Here’s what you need to know about gift card scams.

How the scams play out

There are several types of gift card scams:

The IRS gift card scam. A threatening message that’s allegedly from the IRS claims you’re at risk of arrest for tax evasion unless you pay up pronto! Payment must be made by a gift card. It’s often specifically requested to be an iTunes gift card, because, as you know, the IRS always collects taxes in the form of digital music.
The sweepstakes gift card scam. You’ve won a trip to the Cayman Islands! Just pay the processing fee by gift card. You’ll never see that majestic sunset, but your money’s ridden off.
The utility gift card scam. If you don’t pay up with a gift card, the lights just might go out. They won’t, but if you fall for the scam, you’ll be out the money you put on the gift card.
The balance-check gift card scam. You purchase a discounted gift card online and the seller sends the card but then asks you to read the numbers over the phone to confirm the balance. If you comply, the seller now has all the information they need to drain the card.

How to spot a gift card scam

This information can help you recognize a gift card scam:

The IRS will never initiate correspondence by phone call, text message, or email.
No authentic business or agency will insist on payment by gift card.
If you don’t recall entering a sweepstakes, you probably didn’t win it either.
A caller or message claiming a matter is urgent is almost always a scam.

In general, gift cards should not be used as payments and the numbers on your gift card should never be shared over the phone or online. Also, it’s best to purchase gift cards through reputable sellers only.

Steps to take if you’ve fallen victim

First, notify the company that issued the card about the scam. Next, block the scammer’s number from your phone and mark their emails as spam. Finally, alert the FTC about the scam.

Stay safe!

6 Steps to Crushing Debt

Getting rid of high debt takes hard work and willpower, but it’s doable. Here’s six steps to help you start crushing debt today.

Step 1: Choose your debt-crushing method

There are two approaches toward getting rid of debt:

The snowball method involves paying off your debt with the smallest balance first and then moving to the next-smallest, until all debts have been paid off.
The avalanche method involves getting rid of the debt with the highest interest rate first and then moving on to the debt with the second-highest rate until all debts are paid off.

Each method has its advantages, with the snowball method placing a heavier emphasis on achieving results at a faster pace, and the avalanche method focusing more on actual savings to the borrower money in overall interest paid. Choose whichever method appeals to you more.

Step 2: Maximize your payments

Credit card companies are out to make money, and they do this by making it easy to pay just the minimum payment each month. Beat them at their game by maximizing your monthly payments. Free up some cash each month by trimming your spending in one budget category or consider freelancing for hire and channel those funds toward the first debt on your list. Don’t forget to continue making minimum payments toward your other debts each month!

Step 3: Consider a debt consolidation loan

A personal loan from High Point Federal Credit Union can provide you with the funds you need to pay off your credit card bills and leave you with a single, low-interest payment to make each month. Or, you can transfer your credit card balances to a single card having a low-interest or no-interest introductory period.

Step 4: Build an emergency fund

As you work toward pulling yourself out of debt, it’s important to take preventative measures to ensure it won’t happen again. You can do this by building an emergency fund. Start small, squirrelling away whatever you can in a special savings account and adding the occasional windfall to beef up your fund.

Step 5: Reframe your money mindset

What got you into this mess? Are you consistently spending above your means? Is there a way you can boost your salary or significantly cut down on expenses? Lifestyle changes won’t be easy, but living debt-free makes it all worthwhile.

Step 6: Put away the plastic

Credit cards are an important component of financial health, but when you’re working to free yourself from debt, it’s best to keep your cards out of sight and out of mind. Learning to pay your way with cash and debit cards will also force you to be a more mindful spender.

Best of luck on your journey toward financial freedom!

Beware Lottery Scams!

Lottery scams are frequent go-to’s for scammers, and they cash in on numerous victims. Let’s take a look at lottery scams and how to avoid falling victim.

How the scams play out

In a typical lottery scam, the victim is notified they’ve won a lottery. They may be contacted by mail, phone, text or by social media. The allegedly won prize can be a pile of cash to the tune of millions, a tropical vacation or even expensive electronic devices.

Here’s where things get tricky. To claim the prize, the victim is told they must pay a “processing fee,” but the money can only be wired to a bank account or furnished via prepaid debit card. If the victim pays the fee, the scammer will continue collecting these fees and stalling over the delivery of the prize.

In other variations of the scam, the target is asked to call a phone number or click on a link to claim the prize. They’ll then be instructed to provide personal information, such as their Social Security number or checking account info. Unfortunately, this information will make the victim vulnerable to identity theft.

Red flags

To avoid falling prey to a lottery scam, look out for these red flags:

You’ve been notified you’ve won a lottery you’ve never entered.
The lottery you’ve allegedly won was drawn overseas.
The email, text message or social media alert informing you of your win is riddled with grammar mistakes and typos.
You are warned to keep your “win” confidential.
You’re asked to pay a fee to collect your winnings.
You’re asked to share confidential information over the phone or online to claim your prize.
You’re instructed to call a specific number or click on a link in order to verify your prize.

If you’ve been targeted

If you believe you’ve been targeted and/or victimized by a lottery scam, take quick action to protect yourself from further harm. Contact the Federal Trade Commission at FTC.gov to let them know about it. If you’ve already shared information and/or money, contact your local law enforcement agencies for assistance and visit the FTC’s page on identity theft to start the recovery process.

Play it safe!

Safe Back-to-School Shopping on a Budget

This year’s back-to-school shopping season requires shoppers to stick to their budgets without exposing themselves, or their kids, to the coronavirus. Here’s how to shop for school safely without breaking your budget.

Set a budget

Look through your kids’ school supply lists, jot down any other necessities you need to purchase for them now, and set a reasonable budget you can stick to. If you dare, assign a dollar amount to each category.

Order online

If you’re trying to avoid crowded stores, your best bet is to shop online. You can find everything your child needs for school on sites like Amazon, Target.com, and Walmart.com. Most big brands offer quick and cost-free delivery when you spend a minimum amount.

Shop the sales

Retailers tend to place different back-to-school items on sale each weekend throughout the summer, and if you’re a careful shopper you can take advantage of them all. Check out the sites of major retailers, or flip through the sale flyers, to find the best bargains leading up to the start of school.

Pair up with a friend

Pair up with another parent and split the supply list between the two of you, with each parent buying items for the kids in both families. This way, one of you can run across town to the store with the crazy deals on crayons while the other picks out binders at the store selling them at the lowest price. As a bonus, you’ll be limiting your exposure to the virus by shopping in fewer stores.

Avoid the crowds

Time all in-person shopping for hours when stores tend to have smaller crowds. Consider an early-morning run or an evening shopping spree instead of an afternoon of hitting the shops.

Don’t forget the masks

The CDC continues to recommend face coverings for all students in K-12 schools. While you may already have a sizable collection of masks at home, consider purchasing some new masks for your child before school begins. After a summer at home, getting used to wearing a mask for hours at a time again will be challenging, and some new, breathable masks will make it easier for your child to adjust.

Follow the tips outlined above for a safe back-to-school shopping season that doesn’t break your budget.

Buying Your First Motorcycle

If you’re ready to get your first motorcycle, we’re here to help! Here’s all you need to know about buying your first bike.

Secure financing

It’s always best to have the financial details of a large purchase squared away before you start shopping so you can avoid disappointment later. You can save up for your bike, charge it to a low-interest credit card or apply for an auto loan from Olean Area Federal Credit Union for affordable interest rates and payback terms to best fit your budget.

Brush up on your motorcycle safety

Before you shop for a bike, it’s a good idea to complete a Motorcycle Safety Foundation (MSF) course. This is similar to driver’s training, and it will help ensure you can ride your bike in better safety. Depending on your state, you may also need to obtain a special motorcycle license.

Procure insurance

In some states, motorcycle insurance is required by law, but even if your state does not mandate it, consider purchasing it anyway. If you finance the transaction, it will likely be required you carry full coverage. As is the case with auto insurance, you’ll have the freedom to choose how much coverage you’ll have, with more robust coverage directly increasing the cost of your policy.

Choose between a new and used bike

A used motorcycle can save you thousands of dollars, but finding one in decent condition can be challenging. Avoid bikes that have mileage exceeding 20,000 miles, and are difficult to start-up, run and/or stop. It’s also a good idea to get a VIN check on your potential new bike and to have it professionally inspected.

A new bike, on the other hand, will be in perfect condition but is a lot pricier. It’s a good idea to run the numbers before setting your heart on a particular motorcycle.

Choose a motorcycle type

Sport bikes-equipped with a leaning design, these bikes can be a good choice for thrill-seekers, but an uncomfortable option for riders planning to take long trips.
Standard bikes-an an upright riding posture and lack of accessories make these perfect for beginners and the budget-conscious.
Cruisers-tend to be heavy, but offer a relaxed riding position, making them an excellent choice for tall riders seeking a stylish ride.
Touring bikes-these motorcycles are loaded with extra features for long trips, including saddlebags to accommodate luggage and large fuel tanks.

Once you’ve chosen your ride type, research models from popular brands and check out ratings and reviews from current owners. When you’ve narrowed down your choice, you’re ready to visit dealerships and private sellers.

Important features to consider

A motorcycle’s seat, handlebars, and foot pegs are not adjustable, so it’s important to choose one that fits comfortably. Consider the weight of your bike, too, since a heavier bike can be difficult to maneuver.

Are you ready to buy your first bike? Contact us, apply online, or call 800.854.6052 to learn more about financing your motorcycle with Olean Area Federal Credit Union!

Your Complete Guide to Secure Mobile Banking

In response to a rise of mobile banking scams, the Consumer Financial Protection Bureau (CFPB) has published new guidance on unauthorized electronic funds transfers, or EFTs. With more people using electronic banking as a holdover from pandemic times, it’s important for consumers to be aware of its vulnerabilities and how to protect themselves from scams. Here’s your guide to secure mobile banking and how to stay safe online.

What are the risks of mobile banking?

Unfortunately, like all transactions happening over the internet, mobile banking has some built-in risks. First, hackers can break into a phone and an account with the intent of stealing money and info. Also, phishing scams that target people over the phone can lead unsuspecting consumers to share login information with scammers so they can hack away. Finally, bogus emails and messages appearing to be from your credit union can lead you to install malware on your device.

How to bank safely online

Consider using a VPN. A VPN (virtual private network) gives you a private network, even when you’re using public Wi-Fi, thus increasing your internet usage security by encrypting traffic to the VPN service provider and allowing internet traffic through a chosen trusted source.
Never share your password. Don’t share your password with anyone, and follow suggested guidelines for choosing a strong password, including alternating between uppercase letters, lowercase letters, numbers, symbols, and increased length beyond minimum requirements. Also, choose a unique password you don’t use elsewhere. Change your password if your password is exposed or becomes known by someone other than yourself.
Brush up on your knowledge of scams. Never answer a text or email that asks for account details, even if it appears to be from your credit union. Also, always be wary of unsolicited phone calls and banking alerts. Follow Olean Area Federal Credit Union on our social media pages and blog page for information on current scams. Also visit ftc.gov for the latest Consumer Alerts and up-to-date security protocols.
Protect your phone. Consider installing an antivirus app on your phone as well as a location-tracking app so you can find your phone if it gets lost. Be sure to lock your phone after using it, log out of the mobile banking app when you’re done, and always keep your phone in a safe place.

Follow the tips outlined above for secure mobile banking and stay safe!

Remembering that technology is constantly changing and improvements to security are always occurring within mobile banking applications, stay on top of industry trends and current security availabilities.