Avoiding a Financial Holiday Headache

It is easy to hand the store clerk your credit card when doing your holiday shopping, because it is probably done in the spirit of being generous. However, when the holiday bills start rolling in, it is not the sweet spirit of generosity that hits you, but rather the bitterness of buyer’s remorse that can overwhelm you.
Make a List
Decide before you head for the mall exactly who you plan on buying a gift for and set a budget for each person on your list.
Check It Twice
Total the amount you will spend on all holiday gifts. While $20 here or $50 there may not seem like too much to spend, when you look at the total amount spent for the twenty people on your list ($20 x 20 people = $400 / $50 x 20 people = $1,000) you get a better picture of how this affects your total budget. Perhaps there are ways to reduce your list or cut back on expenses. Maybe Grandpa doesn’t really need that holiday coffee mug after all!
Understand the Cost of Debt
For example, if you plan on charging $1,500 this holiday season and your credit card carries a 14% interest rate and requires that 3% of the balance be repaid monthly, you will find that it takes you three year(s) and seven months to pay off this credit card—and you will wind up paying $410 in interest!
Smart Shopping
In addition to a list and a budget, you can also choose to shop with cash or debit cards, which will eliminate the credit card bills later. Because the pleasure of the spending transaction and the pain of the payment transaction are one in the same (unlike a credit card), the reality of money spent will be immediate. Studies show that folks spend less when using cash versus credit.

Avoiding a financial holiday headache starts with awareness. Knowing exactly who you need to buy for and how much you have to spend will help guide you during the holidays. The joy of the season does not need to lead to a fiscal nightmare in the New Year.

Posted in Uncategorized | Comments Off

Why I Love Financial Literacy Month at KCFCU!

April is Financial Literacy Month at KCFCU! It was created in 2004 to help educate people of all ages about how to handle money wisely. Financial literacy includes evaluating what we do with our money and learning ways to reach our financial goals. KCFCU offers a variety of fun, FREE and informative events during Financial Literacy Month that you’ll want to check out.

KCFCU Supports Financial Literacy with FREE Seminars and More
At KCFCU, we support financial literacy throughout the year in a variety of ways including classroom presentations, info and tips for our youth, FREE credit reviews and more. This month we are also hosting a FREE seminar to help clear up the mystery behind credit scores—The Importance of Building a Strong Credit History. I really hope you’ll join us for this info-packed seminar on Wednesday, April 24th from 6-7:30 p.m. at our Kukui Grove West office. Bring your friends and family and learn about:

  • Why your credit score is SO important to your financial health
  • How a higher credit score could save you thousands of dollars
  • Tips on how to better your score

Call Taylor Shigemoto at 246-1262 or send him an email to reserve your seat. Do it soon, since space is limited!

For Those 24 and Younger…April Is Also Youth Month at KCFCU!
April is also the time when KCFCU (and credit unions worldwide) place a special emphasis on youth and focus on the benefits of saving with fun incentives, prizes and activities. This month, when a member 24 or younger makes a deposit of $20 or more, he or she will be entered in our weekly $100 CASH drawing, get a cool mood cup and straw, plus more!

It’s a fact…if you get into good financial habits while you’re young, you will carry those habits into your adulthood. But whether you’re young, old or somewhere in between, it’s always a good time to learn how to better manage your money. I’m proud to be a part of an organization that helps its members do exactly that!Your password will expire in less than one day. Please change it.

Posted in Uncategorized | Comments Off

IT’S THE LAW: Switch to Electronic Federal Benefit Payments Today!!!

Source: U.S. Department of the Treasury, Financial Management Service

Do you still receive a paper check for your Social Security or other federal benefit payments?  If so, you are required by law to switch to an electronic payment option by March 01, 2013. That’s coming up quickly!

Make the Switch Before Time Runs Out!
It’s fast, free and easy to sign up for direct deposit or the Direct Express Debit Mastercard by calling the U.S. Treasury Electronic Payment Solution Center at (800) 333-1795, Monday-Friday from 8am to 8pm EST. Or, call your local KCFCU Representative at (808) 245-6791, Monday-Friday from 9am-5pm , and we’ll be happy to assist you.  Wait times are usually minimal. Call now to avoid delays near the deadline.

Benefits of Electronic Payments
Advantages of electronic payments over paper checks include:

  • Taxpayer Savings If everyone switches from checks to electronic payments, taxpayers will save more than $1 billion dollars over 10 years.
  • Crime Protection More than 440,000 Social Security and Supplemental Security Income checks were reported lost or stolen in 2011. Electronic payments can help protect against check theft and other financial crimes.
  • Disaster Readiness Electronic payments help protect money from delivery disruptions caused by severe weather and other unforeseen events.

Choose Your Payment Option
Before making the switch, decide which payment option you would like. If you are unsure, you can call the U.S. Treasury Electronic Payment Solution Center at (800) 333-1795 and an agent will discuss options and help you choose the right one for you.

The U.S. Department of the Treasury recommends two electronic payment options:

  • Direct Deposit If you have a KCFCU checking or savings account, sign up to receive your money by direct deposit. Your federal benefit payment will go straight into your KCFCU account on payment day each month…on time, every time.
  • Direct Express Card If you don’t have a bank account or prefer a prepaid debit card, switch to the Direct Express Card.  Your money will be posted to the card account on payment day each month.  There’s no need to wait for the mail or to make a special trip to cash your check.  You can make purchases and get cash back at no charge anywhere Debit MasterCard is accepted.  There are no sign-up fees, overdraft fees or monthly fees.  Some fees for optional services may apply.  For information on card fees and features, visit www.GoDirect.org.
  • If you do not choose an electronic payment option by March 01, 2013, you may be issued a Direct Express Card.

Be Prepared
Have the following information on hand when you make the switch:

  • 12-digit federal benefit check number
  • Amount of most recent federal benefit check
  • Financial institution’s routing transit number* (for direct deposit only)
    • KCFCU’s routing and transit # is:  321379902
  • Account number* and type – Checking or savings (for direct deposit only)

*This information is often on personal checks.

Keep Your Money Safe
Electronic payments are safer than paper checks.  In fact, you are 125 times more likely to have a problem with a paper check than with an electronic payment.  Even though electronic payments are safer, it’s important that you take steps to keep your money safe.  The Treasury Department urges you to follow these three tips:

  • Be careful of anyone who calls, texts or emails you asking for personal information.
  • Do not give out your Social Security number or account information to anyone unless you are the one who has contacted them.
  • Watch your bank or credit union account or Direct Express card account often to make sure that all account activity is yours.

Remember, you are required by law to switch to an electronic payment option by March 01, 2013. Time is running ou—make the switch today.  More information, including instructional videos on how direct deposit works and how to use the Direct Express card, is available at www.GoDirect.org.   Or call your KCFCU Representative at (808) 245-6791 for assistance with your direct deposit.

Posted in Uncategorized | 1 Comment

Here’s Why It’s a Great Time to Be a Credit Union Member!

Even though credit unions have been around for 150 years, now more than ever consumers are discovering that credit unions are simply a better value and they care more about people than profits. I don’t just work for a credit union; you could say I come from a credit union family. My parents were members of a credit union and I was a member long before I ever worked for KCFCU. I don’t just talk the talk…I walk the walk. Here are three reasons why I believe it’s a great time to be credit union member (especially a member of KCFCU)!

1. More People Are Making the Move to Credit Unions…1.3 Million in 2011!
It was awesome to see credit unions hit a record number of members last year as consumers became increasingly fed up with fees at big banks and moved their money elsewhere. In fact, credit unions added 1.3 million new members in 2011, according to the National Credit Union Administration. Much of this growth was due to Bank Transfer Day (November 5, 2011), a day when people left big banks for consumer-centered alternatives.

2. Credit Unions Are Not-for-Profit and Focused on YOU
Instead of making profits for stockholders as banks do, credit unions (such as KCFCU) pass their profits on to their members. That means we offer you higher savings rates, lower loan rates, and lower and fewer fees. Credit unions are also known for providing better financial guidance and education than banks. That’s because we’re less focused on turning a profit and more focused on providing you with a high level of service and financial well-being.

3. Credit Union Members Save an Average of $996 a Year!*
By keeping your accounts and loans at KCFCU versus a bank, you could save nearly $1,000 a year! What would you do with an extra grand? I can think of many things I’d rather do than pay higher rates and fees—can’t you?

It’s a Great Time to Celebrate International Credit Union Day on October 18th
The theme for this year’s International Credit Union Day is Members Matter Most. As we celebrate this day with more than 196 million people worldwide, we want to thank YOU, our valued members, for your continued support. Know that you matter most to us 7 days a week, 365 days a year!

Stop by any KCFCU office on October 18th from 9 am to noon to learn more about our products and services and enjoy refreshments prepared by our staff as we celebrate the importance and benefits of being a member of KCFCU!

*2010 CUNA Membership Benefits Report. The average of $996 in direct financial benefits is based on high-use households.

Posted in Uncategorized | Comments Off

Buying and Banking Locally Boosts Kauai’s Economy and Benefits Everyone

When You Buy and Borrow Locally, Everyone Benefits!
Buying locally not only makes you feel good when you support the local economy, research shows there is a profound economic impact in keeping money on the island. 

Many markets have been established to provide customers with fresher produce at lower prices than you’ll find at supermarkets.

The New Economics Foundation (an independent economic think tank) discovered that when people bought produce at local farmer’s markets, twice that money stayed in the community! That means those purchases are twice as efficient in keeping the local economy going.

The Fruits of Our Local Labor
It’s easy to find beautiful, fresh produce at our bountiful farmer’s markets on Kauai. I, for one, enjoy spending an afternoon at a local farmer’s market watching farmers and shoppers interact and share information on produce and prices. And, these local farmers put money right back into Kauai’s economy—by using local businesses to market their products, buying farming supplies from local distributors, and paying local taxes—all while using less transportation and packaging requirements, which reduces their costs and helps the environment. Purchasing local helps grow other businesses and jobs, as well.

Saving and Borrowing Locally Has a Big Impact, Too!
When you deposit your savings with your credit union, you’re ensuring those funds will be loaned back to one of your fellow credit union members. Plus, when you apply for a loan, you’re working with a local financial institution that’s making the loan decision, instead of a corporate loan center, which may be out of state. And let’s not forget, big banks are earning profits for stockholders, whereas your credit union’s only priority is you. Any profits made at your credit union (after expenses) are returned to you and your fellow members in the form of low cost loans and great financial services at a nominal cost or none at all.

When you buy and borrow locally, everyone benefits! It’s local commerce at its best!

Got a great tip on buying locally here on Kauai?  Share it with us!

Posted in Uncategorized | Comments Off

Valuable Money Advice That’s Worth Passing onto Your Kids

Your kids may have inherited your brown eyes, your gift for talking story or your quirky laugh. Will they also inherit your money management skills? Better yet, do you want them to inherit your money management skills?

In my experience, having children has made me a better person. When I know my kids are watching, I want to set a better example—whether that’s being more polite to others, being a good sport or handling money responsibly.

Here’s some valuable money advice I’ve learned that I think was worth passing on to my kids (in actions and words):

  1. Learn as much as you can about money and start early. Good grades in school will never make up for failing grades in personal finance.
  2. Time + money + compounding = wealth. Saving a few dollars a day at a young age can add up to millions in 65 years. You’ve got time on your side.
  3. A strong worth ethic is the new master’s degree: Few people have it. If you have this trait, you will make more money.
  4. Spending is easy, but saving money takes a plan. Make a plan for your money. Set goals, take action and work for results.
  5. Practice the 10/10/80 concept. Don’t spend all you have or else you are living from paycheck to paycheck. Give 10% to charity, save 10% for emergencies and financial security, and live on 80% spending it wisely.
  6. Money doesn’t grow on trees. Sounds cliché but many kids don’t realize this until they are out on their own. Money has to be earned through hard work, ideas and innovation.
  7. Don’t compare yourself to others. There will always be people who have either more than you or less than you. Handle your money wisely and don’t let others determine your happiness.
  8. Money is not the end, but a means to an end. It’s not how much you have, but what you do with it that counts!

Well, there you have it…that’s my two cents worth! Do you have some financial wisdom you would like to share with us? We’d love to hear it!

KCFCU is a great resource when it comes to teaching kids about money. Check out our new youth sites! We’ll even come to your child’s school to teach classes on financial literacy!

Posted in Uncategorized | Comments Off

The Housing Market May Be on the Upswing…Are You Ready?

Housing Market Predictions
The year is still young, but the latest real estate news indicates the housing market is starting to improve on a national level. I’m keeping my fingers crossed that the improvement will make its way to Kauai. Home sales are expected to rise nationally between two and five percent year-over-year, according to Freddie Mac’s U.S. Economic and Housing Market Outlook survey. One thing that can help Kauai’s housing market:  Jobs!  Unemployment is expected to continue to improve into 2012, as it did at the end of 2011, as well as vacationers’ spending.

On Kauai, residential sales for 2011 were steady when compared with 2010. There were 360 residential sales in 2011 compared with 362 in 2010; however, sales volume was up compared with 2010. Sales were approximately $284 million in 2011, compared with approximately $244 million in 2010; an increase of over 16%. The median sales price decreased to $455,000, compared with $500,000 in 2010. And, home prices on Kauai are expected to drop by 7.6% in 2012 (which is good news for those homebuyers waiting for prices to bottom out).

One bright spot…Kauai is expected to experience increased prices for condos because of buyer demand. And it’s no surprise that nearly 80 percent of American households believe now is a great time to buy with low rates and prices, and improved employment numbers. Many are predicting that confidence could translate into even higher home sales. We can only hope.

While buyers are feeling good—sellers, on the other hand, not so much. No big surprise here considering how many of those sellers are trying to sell homes that are now worth less than what they paid for. But there is a bit of a bright side for sellers…I’ll get to that in a minute.

So, in light of this news…what’s a buyer or seller to do?

Homebuyers Prepare to Make the Leap
Here’s a heads up: These incredibly low rates and prices won’t last forever…really! Now that we’ve determined now is a good time to buy, here’s what you need to do to prepare to buy your new home:

  • Good credit is the key to snagging a mortgage, so get copies of your credit scores and credit history from the three main credit reporting bureaus to see how your credit looks. Or better yet, make an appointment for a FREE credit review at KCFCU.
  • Know how much you can afford based on your budget and expenses, not just what you can get approved for.
  • And here’s my insider tip: After the lender pulls your credit and says you’ve been approved, don’t assume you’re home free. Most lenders will pull your credit again before your loan closes—so keep your credit spotless during the process.
  • To learn everything there is to know about buying a home, attend one of KCFCU’s FREE Home Buying Seminars on February 9 or February 25

Existing Homeowners: Consider Home Improvements or Refinancing Your Loan
Like they say, when life gives you lemons, make lemonade. So, if your kitchen or other area of your home is a lemon…now is the time to make some improvements with affordable loan rates readily available. That way you’ll be ready to sell, if and when you want to, or you’ll just be happier in your home.

It’s also a great time for homeowners to refinance and lock down some of the lowest fixed rates in history—giving you low monthly payments that aren’t going to skyrocket down the road. You may also want to consider refinancing to a shorter term—say 15 to 20 years, because with rates so low you may not see much of an increase in your payments.

Needless to say, KCFCU is here for all of your mortgage loan needs and we can help you determine what option is best for you!

Posted in Uncategorized | Comments Off

Is It a Good Time To Buy a Home or Should I Keep Renting?

While 30-year fixed mortgage rates are at an all time 60-year-low and continuing to drop, the question frequently asked by credit union members is, “Is it a good time to buy a home or should I keep renting?”

If you’ve been contemplating whether to take the next step into home ownership but face uncertainty and anxiety in moving forward, now may be the time to consider your options.  With today’s extremely low rates and low home prices, there’s a saturated inventory of homes in the real estate market from which to choose. Professionals in the real estate and mortgage lending industries refer to the current trend as a “Buyer’s Market”.  Currently, advantage and leverage favors the buyer because of factors such as the huge supply of homes for sale, the low value of homes (sellers are unable to sell homes for huge profits as they did 7-10 years ago because of conservative appraisals), and the overall sluggish economy.

The “Rent Ratio” is an easy way to calculate whether buying in your area is a good idea.  Take the purchase price of a home divided by the annual cost of renting a similar home.  Some experts recommend using the number 20 as your measuring point.  If the ratio is above 20, you should consider renting instead of buying.  If the ratio is below 20, buying may be an option you should look into, especially if you plan to stay in the home for more than five years.

Here’s an example:  The asking price of the home you’re looking to purchase is $385,000.  You research comparable rental units and find the average rent to be $1,900 per month, or $22,800 per year.  The ratio for this scenario would be $385,000/$22,800=16.89.  This ratio is below 20, so buying a home may be a good option.

Let Us Help
If you’re ready to take the plunge and get a mortgage, contact Kauai Community Federal Credit Union at (808) 245-6791 or visit www.kcfcu.org for more information.  We’ll answer any questions you have and help you decide if your time to buy is now.

Posted in Uncategorized | Comments Off

Feel More Festive and Less Financially Frazzled for the Holidays

According to a recent article in Family Circle magazine, the top cause of stress during the holidays is spending too much money. Over the holidays, I personally find myself short on time and long on things to do. We tend to spend more and save less. After all—tis’ the season to overspend—but I’ve got some helpful tips to help you save a few bucks and your sanity, too.

Stick to a budget. I know it sounds simple…but are you really doing it? Heading to the mall before you make a list and checking it twice is just asking for trouble. Before you go shopping, decide how much money you can afford to spend (don’t forget stocking stuffers and shipping). Better yet, knock down your shopping list a peg or two by giving homemade gifts, limiting gifts to children only or drawing names.

Can you get the gift for less, someplace else? These days, there is really no excuse not to compare prices. Check out sites like www.shoplocal.comwww.krillion.comwww.thefind.com to see how much items are selling for in your area. Or use one of the ten best shopping apps for your smart phone to compare prices as you’re shopping. I’ve tried it…it really works!

Don’t procrastinate. Shop during off-peak times and leave the kids at home. It’s a fact (I know from personal experience) that panicked, last minute shoppers spend twice as much. And if you want to take pity on your frazzled nerves, shop on Monday, Tuesday and Wednesday, when foot traffic is just 12% of weekly traffic. One more trick to avoid overspending—shop alone. A cranky kid (or spouse) may encourage you to grab the nearest overpriced gift so you can get home sooner.

Don’t be afraid to say “no.” I know it’s hard, but be realistic about how much you can afford to spend—in terms of time AND money. Give from the heart in a way that makes sense for you—and if that means some people just get cards or a box of chocolates, that’s OK!

Don’t use store credit cards with high rates that would make even the Grinch cringe. Store credit cards charge 18 to 23 percent, which is way too much! If you have to charge something, use a credit card with a much lower rate, such as the KCFCU’s Platinum Visa with Rewards.

Learn from your mistakes. Hey, nobody’s perfect. Even with the best planning, you might spend a little more than you’d like. But use lessons learned from this year to do a little bit better in 2012. One thing you can do is start saving now for next year with a KCFCU Christmas Club Account. Socking away a little every month is much easier than coming up with it all in December!

And one last thing…I have to share this really practical Website I just discovered: www.organizedchristmas.com. It’s devoted totally to decreasing your stress and enjoying the holidays more.  I hope you’ll join me in my quest to feel more festive than frazzled this holiday season. Good luck and Happy Holidays from all of us at KCFCU!

Posted in Uncategorized | Comments Off

Good News for Car Buyers…

So you need new wheels…do you spring for a new ride with that new-car smell or go the practical route and buy used? For me, there’s nothing sweeter than that new car smell. I know I’m not alone, because they’ve literally bottled it into a car air fresher scent.

These Days…Some New Cars Cost Less Than Used Ones
Common sense says buying a used car is more economical…but, I was surprised when I heard the current deals on some new cars are so incredible they actually make a new car less expensive than a one or two-year-old used version of the same model. Crazy, huh? However, this doesn’t apply to all new cars. You will have to research the make and model you are interested in and compare it to a used version to see if it really is cheaper to buy new.

According to Edmunds.com, there are two reasons for this topsy-turvey car-buying situation. The main reason is the recent high demand for used cars (thanks to our struggling economy), which has raised prices for used cars to record levels. According to Kelley Blue Book , the average price for one to three-year-old used cars has risen by 16% a year since 2008. The other reason buying used may cost you more is because used cars in general are financed at a higher rate than new cars.

You Still Can’t Go Wrong with a Quality Used Car
When you buy a used car, you bypass the instant depreciation (loss in value) that hits you as soon as you drive your new car off the lot. As a quick rule of thumb, a car will lose between 15% and 20% of its value each year. Some other advantages of buying a used car include:

  • You’ll save money on insurance
  • Used cars are more reliable today than ever before
  • Some used cars are still under the factory warranty
  • Most new carmakers sell certified used cars, which include warranties

I could go for the bottled version of that new-car smell if I’m saving a few grand in the process by buying used…couldn’t you?

Know How Much You Can Really Afford
Before you narrow down your search for the perfect ride, make sure you know how much car you can afford. A rule of thumb is your total monthly car payments shouldn’t exceed 20 percent of your monthly take-home pay. Use this auto loan calculator to help you estimate what your monthly payment would be for your dream machine.

Research Is the Key to Finding a Ride That’s Made for You
Next research all of your options using KCFCU’s AutoSMART buying guide. You can do a lot on the AutoSMART site, including comparing prices, reading recent car reviews, getting pre-approved in minutes…heck, they can even help you sell your current vehicle. You can also do all of this from your iPhone with the AutoSMART app. (There’s an app for everything these days!)

Put This in Your Back Pocket…
If and when you decide to shop the dealerships, bring along this auto-buying pocket guide. It will keep you focused on the important tasks at hand, when that new car smell has got you feeling a little dizzy with excitement.

Posted in Uncategorized | Comments Off