FEDERAL CREDIT UNION

JANUARY 2020 NEWSLETTER

4572-NL-0120

2020 RESOLUTIONS

Financial Resolutions for the New Year

If you took a poll of everyone’s New Year resolutions, chances are you would hear the same things repeated almost constantly:

“I really want to lose weight.”

“This year, I’m going to get out of debt and stay out of debt.”

“We’re going to start saving more.”

“I’d like to pay off the mortgage.”

“I’m going to get serious about investing.”

So many of our resolutions are financial but, like all resolutions, the financial ones last a month or two at most, and then are forgotten about until the following January.

However, when your goal is small and measurable, you will be looking at success before you know it. Here are several small, realistic resolutions to consider.

Save 1% of your income. Saving 10% may be difficult, but if you are saving nothing at all, 1% is a realistic improvement. Make it automatic so it comes right off your paycheck and deposits into your savings or money market account at the credit union.

Stop using your credit cards. By taking on no new debt, you have taken the first step to getting out of debt entirely.

Send all your spare change to the credit card companies at the end of the month, in addition to your regular payments.

Buy a notebook and start keeping records of all your spending. Just knowing that you will have to account for every penny will force you to think before spending on something you might be able to do without. Experts say we spend 20% more than we think we do. This is a good start to figuring out where the leaks are.

Start using a computer program, such as Microsoft Money, to track your finances. Though it may take a bit of time to learn, you will find yourself better off for it.

Are these earth-shattering ideas? No. That is what makes them realistic. Because they are so small and so specific, you will find them different from most resolutions: you will actually stick to them for a full 12 months.

Just do not overwhelm yourself by trying to take on more than one or two. You can always come back and pick something else for next year.

Happy New Year!

Whether you’re traveling out-of-state or out-of-country, call to let us know your travel itinerary and we’ll put an alert on your credit and debit cards.

New Year’s Day Wed., January 1

Martin Luther King Jr. Day Sat., January 18 and Mon., January 20

President’s Day Sat., February 15 and Mon., January 17 2

020

It’s Tax Time! Are you prepared? The filing deadline for 2019 taxes is April 15, 2020.

If you will be filing a tax return this year, there are a few steps you should take to en-sure you have everything needed to submit accurate information to the IRS and/or state tax agency.

First, be on the lookout for any mail labeled “Important Tax Document(s).” These items will generally be needed to file your return. Before filing, make sure you have received everything you were expecting. Filing without all required items can lead to amended returns and additional tax liability.

Some commonly forgotten items are :

W-2 from second, temporary, or part-time jobs

Forms 1099-INT or 1099-DIV reporting interest and

dividends paid to you by your financial institution or from your investments.

Form(s) 1099-R reporting distributions from IRAs,

annuities, or other retirement plans.

Form(s) 1099-B reporting gains or losses from

investment transactions.

Form(s) 1099-MISC reporting work you did as a

contractor or other miscellaneous income.

Next, gather receipts for expenses that may be deductible or qualify you for a credit. Common examples of deductible expenses are charitable contributions, medical expenses, and local and state taxes paid. Expenses such as daycare costs or tuition, and books for higher education may qualify for a tax credit.

Finally, don’t wait until April 15th to file! Missing items are often discovered during the tax preparation process. Give yourself enough time to gather further information if necessary.

If you have any questions about what you will need to file a return, contact your state or local tax offices or consult with your own tax preparer.

If you owe money to the IRS and need to create, review, or update a payment plan online, you’ll notice a new security feature has been added to better protect your tax information. Here’s what you need to know about the updated login process.

To create an online account, go to www.irs.gov and click on “Make a Payment.” You will then see the payment plan link in the “Can’t Pay Now” section. You will need to provide your:

Valid email address

Date of birth

Social Security number or individual tax identification number

The name, address, and filing status that appeared on your most recent tax return

The new security feature adds a step that requires you to verify either a financial account linked to your name or

mobile phone number registered in your name. If you do not have either of these additional items, you can request the IRS mail a verification code to you, which takes about 5 to 10 business days to arrive.

To view or update your existing online payment plan, you can login with the same user ID and password you have been using. However, you will need to complete the new verification step if you haven’t already.

If you choose to verify with a financial account, any of the following types of accounts are accepted:

Credit card (no American Express, debit, or corporate cards)

Student loan

Home Mortgage

Home Equity loan or line of credit

Auto loan

The IRS only uses this information to verify your identity. Your card won’t be charged, and you’re not sharing balance or other information.

If you choose to verify with a phone number, your phone must be a mobile phone in your name (family plans may not work), able to receive texts, and based in the United States.

Many people associate estate planning with the

distribution of assets at their death. However, it is equally

important to prepare for your potential incapacity

when you are unable to make your own decisions

due to an accident, health concerns, etc. This type

of planning involves deciding who you want to make

decisions on your behalf if you are unable to do so.

Incapacity Planning includes the following estate

planning documents:

– Appoints someone to

act on your behalf, known as an Agent or Attorney-in-

fact. This individual will be able to perform financial

and legally binding transactions on your behalf.

– Heath Care Power

of Attorney – Appoints someone as your Agent to

make medical decisions for you any time you are

unable to make your own treatment decisions, not

just end-of-life. Living Will – Designates what type of

life sustaining medical treatment you receive when

there is no hope of recovery.

– Allows transferring

assets to the trust while continuing to manage the

Financial Literacy: Budgeting Tired of living paycheck to paycheck? Do you want to start feeling in control of your finances? Wouldn’t you like to be in a position to be financially prepared to deal with an emergency? Maybe it is time to setup a workable budget.

A budget is a summary of projected income and expenses for a set time period, like a month. A budget is a visual way to understand the account of your income and how you spend and prioritize your funds.

Keep your budget simple with an income column and an expense column. A zero based budgets earmarks all of your funds BEFORE they are spent. Recommended allocations for a zero based budget are 50/20/30.

50% Essentials: transportation, food, housing and other basic needs

20% Savings and Debt: build an emergency fund first

30% Personal spending: life enhancements.

With careful spending you may be able to use some of your personal spending fund to pay off debt faster.

Financial guru Dave Ramsey recommends starting with a $1000 emergency fund and build up to 3-6 months of your expenses.

Adhering to your budget takes the mystery of where your funds are going and creates financial clarity. A budget can help you identify where your funds are being spent unconsciously or wastefully, so you can gain control over your finances and quickly adapt to financial changes in your life.

Regardless of your income, a budget can be beneficial for everyone. Make a budget, follow it and make adjustments as you go if you find you have left out some expenses. Follow through with implementing your budget and put yourself in a position to have freedom to make financial choices that allow you to enjoy your life.

assets yourself, as trustee. In your trust

document you will appoint a successor

trustee to act on your behalf if you

become incapacitated.

If you have any questions or

wish to discuss your estate and

incapacity planning goals,

please contact your credit union

and ask to speak with a Trust

Representative or consult your

own Attorney.

Loan rates are subject to credit worthiness and loan term.

Get an auto loan with us with a rate

“AS LOW AS”

2.99% APR

It’s hard to appreciate the beauty of a winter wonderland when you’ve just skidded into a ditch. Whether your winter is snow white, wet and icy, or just plain rainy, driving during the winter months does require extra care.

Keep these tips from safety experts in mind this winter:

Cover windshield wipers with socks. Cover windshield wipers with knee-high socks the night before a snowfall.

Cover side mirrors with plastic bags. The night before a big snow storm, cover your car’s side mirrors with plastic bags, securing them with clothespins or rubber bands, to prevent ice from forming.

Learn to recognize situations that can be hazardous. That means planning your trip with the weather forecast in mind. Allow extra time for travel and remind yourself to be patient.

Adjust speed, position, direction, and attention to be able to maneuver safely if a hazard develops. For instance, anticipate a stop sign at the bottom of a hill; maintain a safe speed all the way down by gently braking. Do not expect to do all of your braking at the bottom.

Scan the road far enough ahead to be able to react safely to approaching situations and watch for passing or approaching

vehicles. For example, avoid going up a hill right behind another car. If that car loses traction and slows or stops, you are stuck too. Instead, leave plenty of distance so that you can proceed at your own pace and keep going.

Scan the road thoroughly before changing speed or direction. Remember: Road conditions will affect both.

Sprinkle kitty litter on tires. When you are stuck in the snow, sprinkle kitty litter on tires to get better traction and get on your way.

Have a winter survival kit in your car supplied with a blanket, windshield scraper, jumper cables, shovel, tire chains, water and snacks, a flashlight, tire sealant, sand or kitty litter, first aid kit and your mobile phone.

Taking preventive action is your best driving defense against having to deal with extreme cold and weather conditions. Preparing your car in advance can reduce the risk of weather related safety problems.