News for YOU!

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May 2023

Spring Clean Your Credit

Spring is a great time for a fresh start and cleanup but not just for your home or yard. It's also a great time to clean up something very important in your financial house – your credit.

Whether you're looking to establish credit, give some TLC to one that could use some improvement, or already have great credit, there are some important steps you can take to ensure your credit is the best it can be. Because let's face it, a strong credit score will not only help you qualify for credit but also help you get the best rate to save money.

Here are six ways to spring clean your credit:

Pay your bills on time. The biggest determinant of your credit score is your history of paying your bills. Late or missed payments will negatively impact your score. To ensure that doesn't happen, set bill payment reminders or arrange to have payments made automatically. And remember, just because you may not have seen a bill in the mail or via email doesn't mean you don't have to make a payment.

Don't use all the credit available to you. Another factor in your credit score is your credit utilization, which is the amount of your available credit limits that you actually use. In general, lenders like to see that you only use about 30% of the credit available to you. If you use more than that, you can negatively impact your score. One way to lower your credit utilization and raise your score is to pay down revolving debt, which frees up available credit. There's an even simpler way to lower your utilization: use less credit.

Leave old accounts open. In the world of credit scoring, age matters. Lenders like to see that you have a long and established history with creditors. So, even if you don't use a credit card or other revolving debt available to you, it might make sense to keep those accounts open. In fact, it's not a bad idea to make a purchase now and again to keep them active. Just make sure you make your payments on time.

Only use credit when you need it. It seems like wherever you go today someone wants to entice you with a special offer to open a credit card to earn some special bonus – like free airline miles or a big discount on your purchase. Before you sign up for those cards, make sure you understand the impact they can have on your credit. Every time you apply for credit, a hard inquiry is done on your credit report, which can negatively impact your credit score. That's why experts advise that you don't apply for multiple credit cards at the same time or apply when you need a larger loan, like a mortgage.

Monitor your credit. One of the most important steps you can take in managing your credit score is to monitor it regularly. Keeping track of your credit score can help you see the impact of your credit usage and guide your financial decisions. It can also help you prepare if you need to borrow later on down the road, say to get a mortgage.

Get a copy of your credit report. Another great way to monitor your credit is to get a copy of your credit report. You can get a free copy from the three credit bureaus – Equifax, TransUnion, and Experian – at annualcreditreport.com. Viewing your credit report will help you see your credit lines and balances as well as help you identify and correct mistakes, such as incorrect addresses or accounts that don't belong to you. It could also help you determine if you're a victim of identity theft.

Get growing – tend to your credit today!

Talking to Children about Money

In many families, talking about money can be uncomfortable, and in some cases, almost taboo. When children request something that costs more than the family is comfortable spending, children of different ages react differently. Young children may not have an understanding of the item's cost relative to the family's finances. And a teenager's "need" may be viewed as an "extravagance" by the parents. These simple ideas can help foster two-way conversations between parents and children, as well as a basic understanding about the value of money.

Young children
It is never too early to help your child develop a healthy respect for money and to develop some good financial habits. The practice of using an allowance can be worthwhile if it does the right things. If your objective is to teach the basics, consider the following:

Set a weekly allowance to match the age of the child; perhaps a five year old receives $5.00 weekly.
Tie the allowance to some required chores like setting the table for dinner. If the chores aren't done, withhold allowance for that week.
Divide the allowance into three spending categories — 1/3 for immediate spending, 1/3 saved for some specific near-term purchase (like a small new toy) and 1/3 for a longer-term goal (like a major new toy).

Teenagers
This is often the most difficult time for children to deal with financial issues. Peer pressure, a desire to keep up with what their friends have, and the growing realization that they can't have everything they want can add tension to any conversation about finances. However, it is also the time when children can begin to understand more complex financial issues, and when financial habits are formed.

The allowance approach gets more complicated in the teenage years as the costs of desirable items increases, and they are drawn to more activities that cost money. This may be a good opportunity to discuss how a job could help them afford the things they want. After-school and summer jobs are an ideal way for teenagers to learn that money is earned, and not something that mom or dad will always provide. A job will also teach young adults about responsibility, since the employer will be relying on them to be present and punctual. If an outside job is not possible, consider paying your teenager an hourly rate for additional chores, and insist they treat the chores as a job.

Helping teenagers establish a checking account, or even preparing their own tax returns, will go a long way to helping them understand that money is a serious matter, and that someday they will need to be self-sufficient and make their own financial decisions. If they get a checking account, be sure you teach them how it works and how to reconcile the account every month.

Keep the conversation going
Be open to discussing finances with your children. Kids are naturally curious about what they see their parents doing and that curiosity can be easily turned into teaching opportunities. When your child sees you writing checks that is an ideal time to start talking about the importance of paying bills and balancing your budget. A question about what it means when the TV news reports on stock market activities can lead to a more serious discussion about money and long-term financial goals. And a conversation about choosing a college can be an eye-opening experience when your child learns what it costs.

Take advantage of these opportunities and by the time your child is ready to leave home, they will have a foundation to better prepare themselves for their financial future.

Memorial Day

Our offices will be closed on Monday, May 29 in observance of Memorial Day as we honor and remember the men and women who sacrificed their lives while serving our country.

April 2023

Five Ways to Keep Your Money Safe

Life is unpredictable. Our financial lives can be, too. From soaring inflation to rising interest rates to volatile markets, it can sometimes feel like we don't have control of our money, especially your hard-earned savings. Rest assured, though, there are some steps you can take to safeguard it.

Understand deposit insurance. With the rise of Internet banks, you now have more savings and checking account options than ever before. But before you open an account or send money, make sure your money is protected by deposit insurance. With FDIC insurance, you're protected up to $250,000 per depositor, per insured bank, for each account ownership category.

Take some time to understand how deposit insurance works to know how to protect your accounts. The FDIC EDIE calculator is a good resource to help you determine your coverage. If you have higher deposits you may want to consider choosing a financial institution that offers additional insurance protection. KS StateBank can assist you to obtain full FDIC protection. We are a member of the IntraFi network and offer ICS® (insured Cash Sweep) and CDARS® (Certificate of Deposit Registry Service) for business and personal deposit accounts that exceed the $250,000 FDIC limit.

Keep track of your accounts. It's always a good idea to monitor your accounts and balances to see where your money is going and to identify fraud. You should also keep track of and document all your assets, including your checking, savings, CDs, and retirement accounts. You can monitor your bank accounts online and even set account alerts to notify you about specific transactions or when your balance reaches a certain level.

Review your credit report. In addition to monitoring your savings, you should safeguard your credit. Reviewing your credit report regularly can help you detect and correct any errors or misinformation that could impact your credit score. It can also help you detect fraudulent activity.

Check in on your investments. Though volatile market conditions can change the value of your portfolio, it's a good idea to regularly review your investments to view your activity and balances. If you work with a professional, schedule a meeting to evaluate your goals, changing market conditions, and tolerance for risk.

Don't be reactive. When financial conditions change, such as market drop or a bank closure, it's easy to become reactive and make impulse decisions. Before you consider withdrawing your money or selling securities, always do your research to ensure you know all the advantages and disadvantages and understand the short- and long-term implications.

You've worked hard to build your savings. Take the time to protect it.

CD Smarts. How CDs Can Help You Meet Your Financial Goals

Over time, Certificates of Deposit (CDs) have provided a safe and secure way to build savings. However, in today's current rising interest rate environment, they've become even more attractive, allowing savers to lock in higher rates of interest over fixed period of times – and get the assurance of deposit protection. But before you invest in a CD, there are some questions you need to answer.

What is a CD?
Before you invest in a CD, it's important to know what it is. A CD is a savings vehicle that offers a fixed rate of interest over a fixed period of time. Unlike savings accounts that allow you to withdraw money as you choose, CDs typically provide higher rates of return when you deposit money for a specific term – often from 3 months to 5 years. In general, the longer the term of the CD, the higher the interest rate you will receive.

What are the reasons you need to save and when will you need the money?
The decision on whether to invest in a CD depends on the reason you need to save and when you need your funds. For example, if you are saving for a down payment on a home, and you plan to buy the home in a few months, a CD wouldn't make sense. However, if you plan to buy the home in a year, a CD may be a great choice.

In general, CDs don't make sense if you think you'll need to access the money before the term expires.

What is the interest rate?
Interest rates vary per lender and CD term. When investing in CDs, you need to think about what may happen with rates. If rates are rising (as they currently are), you may want to invest in a shorter-term CD because you may get a higher return later. Similarly, if rates are falling, you may want to invest in a longer-term CD to lock in higher rates. CD rates vary by lender so you'll want to shop around.

What are the fees?
Most lenders do not offer fees to open CDs. Most charge pre-payment penalties, which means if you need to access the money before the term of the CD expires, you will have to pay a fee. The amount of that fee will vary by lender.

When does interest on your money compound?
CDs offer another advantage to help borrowers – compounding interest. Compounding means that interest earned is added to the balance in your CD. CDs may be compounded either daily or monthly.

How can you take advantage of the higher rates CDs offer without sacrificing liquidity?
One strategy savvy CD investors use is called laddering. Laddering involves opening multiple certificates of deposit (CDs) with different maturity dates. Then when a CD matures, you have the option to take the money or invest in another CD.

In short, investing in CDs can be a smart way to reach your savings goals.

March 2023

Smart Things to Do with Your Tax Return

What's not to love about receiving money? It's why millions and millions of people play the lottery each year. And while most won't be lucky enough to win the jackpot, they may very well receive money in a far more common way — getting a tax refund.

For some Americans, tax time is a time of excitement as they wait for a check in the mail or an electronic bank account deposit from Uncle Sam due to overpayment of their taxes. Because this money is often considered extra money, many people will use the funds to splurge — maybe take a vacation or install a big screen TV. But while those may be considered fun purchases, the excitement of having them often wears off pretty quickly.

If, however, you use your refund wisely, you can take advantage of long-lasting benefits. Here are some great suggestions for putting your tax refund to work for you all year long:

Build an emergency fund. In these challenging economic times, many people live paycheck to paycheck. That makes managing unexpected expenses, such as car or home repairs difficult to manage. One way to protect yourself from unexpected expenses or losses in income is to have an emergency fund in a liquid savings account.
Reduce debt. Do you have higher-interest credit card, auto loan, or other debt? Consider using your tax return to pay down your debt. It's always wise to pay off the highest-interest debt first.
Make home improvements. Does your home need new windows or a new roof? Consider using your tax return money to finance these important home improvements, which can add value to your home.
Make an energy-efficient purchase. Use your refund to purchase energy-efficient appliances, such as a dishwasher, dryer, or refrigerator, which can save you money all year long.
Start a college savings plan. If you have children, consider using the funds to open an Education IRA or 529 college savings plan. Once you open the plan, arrange to invest in the fund on an ongoing a basis. Even a small amount of money each month will add up over time.
Save for retirement. If you don't have a retirement plan through your employer, consider opening an Individual Retirement Account (IRA) with your refund check. Be sure to check with your tax advisor first.
Pre-pay your mortgage. If you want to reduce the term of your loan and the amount of interest you will pay over the life of the loan, consider putting the funds from your tax return down on the principal of your mortgage.

The decision on how to best use your tax return depends on your unique financial situation. However, if you choose any of the options above, you're sure to win.

What’s your next job search move?

Say you’re looking for a job. You’ve found some you’re qualified for on a well-known employment website and you apply to a bunch of them. If you get a message saying “You’re hired! We just want some more info from you,” what’s your next move?

If you said, “Check out the company and the job by doing my own research before giving them any personal information,” that’s a great answer and a good first step.

It’s easier than ever to apply to lots of jobs with just a few clicks. It’s also incredibly easy for scammers to pose as legitimate employers. While there’s no sure-fire way to detect a job scam, there are important steps to take before giving anyone your money or personal information.

Do your own research. Search the company and job name with the words “scam,” “complaint,” or “fraud.” You might find they’ve scammed other people. Scammers pretend to be both well-known and smaller companies, posting jobs on employment websites. So, reach out to the company directly using contact information you know is legit.
Don’t pay to get a job. If someone says you’ve got the job, but you have to pay them for something — or if they say you have to deposit a check and send money back, those are scams. Period. No legitimate job will make you pay for expenses or fees to get the job.
Never give personal info up front. Some scammers will try to get your bank account, routing, or Social Security number as soon as you’re in contact. They might say, “to set up your direct deposit.” Stop. That’s a scam.
Talk to someone you trust before you take a job offer or business opportunity. Ask them what they think. Then listen to what they say.

If you think you’ve spotted a job scam, or if you’ve lost money to one, report it to the FTC at ReportFraud.ftc.gov.

Information for this article was provided by the Federal Trade Commission.

February 2023

Find Love for Your Money This Valentine's Day

Your valentine isn't the only one who should be receiving love this February. Your finances deserve some tender love and care as well. Here are four ways to show your money it matters.

Be money aware
One of the best things you can do for your finances is to know where your money is actually going. Reviewing your bank and credit card statements regularly will allow you to not only know your spending each month, but also see where you're prioritizing your spending. For example, you may not realize you're spending $600 per month on dining out or that you're paying for subscriptions you no longer use. Awareness is key to saving money and making sure you're spending the way you'd like. Our free online financial management tool, My Money, makes it easy to keep track of your money maintain your finances. Look for the My Money tab in your KS StateBank Online Banking account.

Review your credit score
Credit scores have a significant impact on your finances, affecting whether you are approved for loans, credit cards, and even housing. Your score is a reflection of how reliable you are when it comes to paying back your bills. It also affects how much you pay for services. To improve your credit score, always pay your bills on time, fix past due balances, and keep your balances on your credit cards low in comparison to your limit.

Pay your bills on time
Bills are an inevitable part of life. Avoid late fees, damage to your credit score, disruptions in your service, evictions, and a whole host of other issues by paying your bills on time. If you've had trouble paying your bills in a timely manner before, getting organized can help ensure you don't miss another payment. Write down what bills you have and when they're due, and set reminders so you don't forget. You can also set up automatic payments to ensure you pay on time, every time.

Pay more than the minimum
If possible, pay more than the minimum payments on credit cards and loans to reduce the overall amount of money you owe. For example, if your minimum student loan payment is $300 per month and you are able to pay $350 per month instead, you're paying $600 more per year, the equivalent of two additional payments. This will reduce the number of payments and the amount you pay in interest over the course of your loan.

Though Valentine's Day only comes once a year, you can show love to your money all year long by making it a priority. Check your progress and stay the course. You and your money are worth it!

Romance Scams: It's Not True Love if They Ask for Money

Lots of us have profiles on online dating sites, apps or social media to find “the one.” But that interesting person who just messaged you could be a sweet-talking romance scammer trying to trick you into sending money.

Reports of romance scams continue to grow, and costing people a lot of money. According to Federal Trade Commission (FTC) data, reported lost money losses increased from $87 million in 2017 to $547 million in 2021.

In a sea of online profiles, romance scammers can be hard to detect. But, there are signs you can look out for. Scammers start by using someone else’s identity to create fake profiles. They’ll send you flattering messages to make a special connection, say all the right things, and gain your trust. They might claim to be a doctor, a servicemember, or an oil rig worker living overseas. They want to make future plans with you. But then, something comes up and they ask you for money to help them out. Which nearly always means asking you to buy gift cards (and give them the PIN, so they get the cash), or wiring them money.

Here’s the thing: Never send money or gifts to a love interest you haven’t actually met. It’s a romance scam.

Stop communicating with the person immediately.
Search online for the type of job the person says they have. See if other people have heard similar stories. For example, you could do a search for “oil rig scammer” or “US Army scammer.”
Do a reverse image search of the person’s profile picture. If it’s associated with another name or with details that don’t match up, it’s a scam.
Never wire money to a stranger, or pay anyone with gift cards. If someone asks you to wire money or pay with gift cards, report it to the FTC at ftc.gov/complaint.

Information for this article was provided by the Federal Trade Commission.

Presidents Day

All KS StateBank locations will be closed on Monday, February 20 in observance of Presidents Day. We will reopen during regular hours on Tuesday, February 21.

January 2023

5 Steps to Dig Out of Holiday Debt

It's a holiday leftover many of us carry around for months. It's not Aunt Edna's fruitcake or even those few extra pounds amassed from all the holiday treats. It's the excess credit card debt that comes from spending more than you can afford during the holiday season. Unfortunately, for many Americans, a few festive days of the year can result in mounds of depressing debt that can take months to shed.

If you find yourself with leftover holiday debt, here are some steps you can take:

Stop the credit storm. If you can't purchase something with cash or your debit card, don't buy it. While it's important to have credit cards for emergencies, it's a good idea to put them on ice until you pay down your debt.
Start digging out. On your credit card statement is the minimum payment amount you must make each month to cover finance charges. Always pay more than that amount. The more you pay, the faster you will pay down your balance. If you have multiple credit card accounts, focus on paying off the ones with the highest interest rates first.
Consolidate higher-interest debt. Many credit card companies offer attractive balance transfer offers that come with low teaser rates, allowing you to transfer higher-interest balances to save on interest. Be sure to read the fine print so you know when the introductory rate expires and what the prevailing rate will be. It's also critical to close the accounts from which you transferred the debt. Many people make the mistake of keeping those cards and running up new balances, creating even more debt.
Minimize your other spending. Take a close look at your monthly budget and see if you can cut your spending in other areas in order to pay more on your credit card debt. If you have the opportunity to make more money, either by picking up more hours at work or getting a second job, consider putting excess funds on your credit card debt.
Stay the course. While it can be overwhelming to look at the debt you owe, the most important thing you can do is keep making payments. If you keep digging, you're sure to see a clear path toward credit card debt freedom.

Tips for Avoiding Scholarship and Student Loan Scams

The cost of going to college is on the rise and many students are in search of scholarships and federal student loans to help them pay for their education. 84% of first-year students receive financial aid and 66% apply using Free Application for Student Aid (FAFSA).

Unfortunately, the high volume of scholarship and student loan applications also creates an opportunity for scam artists. More than $100 million is lost in scholarship scams every year and more than half of all students who applied for a private loan reported receiving a fraudulent loan, according to the Federal Trade Commission (FTC).

It’s important to stay vigilant and informed so you can avoid these scams. Here are a few thing you can do to protect yourself:

Be wary of the information you share and where. Never share your FAFSA information
Only solicit federal student loans from companies identified by the Department of Education
Never pay to apply for college scholarships

If you or your family encounter suspected scholarship scams, report them immediately to the following government agencies:

Information for this article was provided by the American Bankers Association.

Martin Luther King, Jr. Day

Our offices will be closed on Monday, January 16 in honor of Martin Luther King, Jr. Day. We will reopen during regular hours on Tuesday, January 17.

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