Checking Account Basics

What you should know about using checking accounts

Nowadays, it seems like nearly everyone has a checking account. It would seem, therefore, that most people are experts when it comes to checking accounts. That isn’t true; however, most people know how much money is in their checking account and not much else. The following information can help you learn about the different types of checking accounts and what options you have for opening checking accounts.

They offer more flexibility than a savings account
“A checking account differs from other bank accounts in that it often allows for numerous withdrawals and unlimited deposits, whereas savings accounts sometimes limit both,” according to Investopedia.

This flexibility is the tradeoff for having lower interest rates than savings accounts. Your checking account is the one that you will draw from when you need immediate money to pay for things like bills, groceries or online purchases.

Money can be deposited automatically, such as from your paycheck, or it can be deposited at an ATM or through a teller. Many financial institutions also offer mobile deposits, which only require taking a photograph of a check on your smartphone.

There are many options for withdrawing also, such as using a debit card or a check at a store or by using an ATM card to withdraw cash. You may also be able to pay bills online, directly from your financial institution’s website.

There are multiple types of checking accounts
Many people don’t realize that there’s more than one type of checking account, and that mistake can be costly.

“Checking accounts can include business accounts, student accounts and joint accounts along with many other types of accounts which offer similar features,” states Investopedia.

Making sure to open the correct type of account means that the account will best suit your needs. Student accounts are beneficial to people who may not meet deposit or balance minimums, while business accounts maximize the benefits that entrepreneurs need most and help business owners keep their personal and business finances separate.

Each person can have more than one
In addition to the fact that there are multiple types of checking accounts, many people don’t realize that they can have multiple of the same type of checking accounts at anytime. Having multiple checking accounts is even encouraged by some financial experts, as an easy way to budget and prevent overspending on certain expenses.

For example, many couples prefer to maintain separate accounts for each partner while also sharing a joint account for bills and other family-related expenses.

“This allows couples the flexibility to make independent financial decisions, since not every financial decision is going to involve both parties,” says certified financial planner Kristen Euretig for Fox News Business.

Other families may wish to split accounts even more, such as having one for account for rent and utilities, another for food and so forth. This makes it easy to see if there is enough room in the budget to head to a restaurant or if cooking at home is a better idea.

You can mix online and brick and mortar accounts
You may also wish to add an online checking account to your portfolio in order to earn money with a higher interest rate. This can be a profitable choice for people who find the restrictions of savings accounts difficult to adhere to, but who still want to find a great interest rate online. Using an online checking account, while maintaining your accounts at your local bank, gives you flexibility because your money is always nearby if you need to make a withdrawal or if you have questions to ask someone in person.

“It absolutely makes sense to open a second account with an online [institution] for a higher yield,” states Euretig. “In addition to higher rates, online accounts often have useful savings features that make it easy to set up automatic savings plans that draw from a traditional brick-and-mortar bank account.”

Many financial institutions offer online banking options
If you don’t wish to open an online only account because you like the option to make easier deposits and withdrawals, you may still be able to take advantage of the ease of online checking if your financial institution offers online tools. Many small community-based institutions now offer mobile tools and online banking options that rival or even exceed those offered by the national chains, so be sure to ask your bank about the options available to you.


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Drive Green with Eco-Driving Tips

Decrease your fuel usage to save your budget and environmental impact

The costs and environmentalldfinance_e_a002960156 impact of gasoline have risen greatly over the last few years. Long gone are the days when you could fill up your car for $1.39 a gallon. With fuel costs rising more each year (sometimes tipping over the $4 per gallon mark), fuel conservation has become a necessity for many families. Not only is gasoline expensive, but the exhaust emitted from thousands of vehicles has created a negative environmental impact on metropolitan areas. You can save on fuel costs and your overall environmental footprint, with just a few small changes in your driving habits.

Drive the speed limit
It makes sense that the faster you drive, the more fuel you use. Starting and stopping quickly and often also increases fuel usage. Maintain your speed by using your cruise control and stay within the speed limits. According to http://www.fueleconomy.gov, you can save up to 14 percent of your fuel usage, or as much as $.52 per gallon of gas just by driving slower speeds.

Carpool with others
Save fuel usage by carpooling with others. Going to a wedding reception? Ride along with family or friends. Heading to work? Carpool with coworkers. Dropping the children off at school? Volunteer to take turns taking all of the neighborhood children together. Carpooling saves on gasoline usage, and it also has the added benefit of being an environmentally friendly choice. Fewer vehicles on the road will lead to lower carbon emissions in the air.

Combine errands in one trip
Most families have a number of weekly errands. It seems there’s always dry-cleaning to pick up, items to take to the post office or business to conduct at the bank. Try to combine all your errands in one trip each week, preventing the need to run out for each individual task.

Ditch the car top carrier
Using a car top carrier can greatly decrease your fuel efficiency. By sitting atop your car, the carrier pushes against the wind as the car moves, which creates resistance. That resistance results in more gas usage. Use a top carrier only when necessary and remove it when it’s not needed.

Keep it light
Vehicles that weigh less require less fuel to operate. Remove any unnecessary items from your trunk to keep your vehicle at its most fuel-efficient. Take the kids’ old sports gear out of the trunk and remove other heavy items stored in your vehicle. The savings may be small, but they add up over time.

Consider other transportation
One of the best ways to save on fuel usage is to leave the car parked in the garage and walk or bike to places nearby. Not only will you save on fuel costs, you’ll receive the added benefit of exercise.

A few small changes in your driving habits can result in larger, more effective changes over time. Consider driving the speed limit, carpooling or walking to save on your monthly fuel budget, all while helping the surrounding environment.


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Investing for Students

Students can invest to grow their funds while still in school

Finances can bebankingon_e_a002960754 frustrating for college and graduate students in many ways. It can be discouraging for students to watch their debt increase each semester while feeling like they can’t earn money when in school full time. Fortunately, even though full-time students can’t typically work enough hours to earn meaningful money, investing is another way that they can help their bank account balances move in the right direction.

Finding the best loans is only one part of the financial equations for proactive students who wish to put themselves in the best financial situation as soon as possible. Although your schedule may not leave you enough hours to hold down a steady job, the random hours you have speckled between classes is perfect for managing a beginner investment portfolio.

“The biggest resource and advantage college students have is time,” states investment executive Paul Feldman for USA Today College. “It’s important to take the maximum advantage of how much time you have — that’s one of the main things that’s going to drive success.” Feldman recommends that students start investing right away by making contributions to a Roth IRA.

An IRA, Roth IRA or 401(k) are great options for students who have a little extra cash that they would like to invest. They are perfect for young investors because compounding returns make it drastically easier to save for retirement if you start early.

“The compounding of the investment returns is huge when you’re looking at decades rather than months or years,” states Eric Tyson, author of Investing for Dummies. “Young people [might] only need to save six to eight percent of their annual income each year [as opposed to 10-12 percent] to be able to accomplish a given retirement goal. I wouldn’t go overboard with it, but it certainly is a reasonable thing to begin to think about.”

Before throwing all your spending money into the stock market, it’s important to learn how the market works and begin the process slowly. According to USA Today Collegiate Correspondent Jennifer Kline, students looking to learn how to invest should make sure to spend time brushing up on the current events in the finance world each day. Creating or joining an investment group at school is another way that students just dipping their toes into the stock market can find support and advice.

Kline also notes that taking a business class can go a long way toward preparing students for financial success. “Understanding the fundamentals of running a business is invaluable when you’re navigating and analyzing the stock market,” states Kline. “After all, the purpose is to invest in strong companies, and finance classes can help you determine a winner from a dud.”

So, once you’ve taken a few business classes and gotten into a habit of reading the finance news each day, you can begin tightening your budget so that you can put aside money to invest. Be sure that you’re not investing money that you need readily available, however.

“Before jumping into an investment, the experts agree that young adults should have adequate savings to cover an emergency or unexpected expense,” cautions Fox News Business.

One benefit of being a young investor is that you have more time to allow market processes to work in your favor. Even investments that have a strong upward trend will experience dips and increases, sometimes dramatically. Fortunately, students, compared to people on the verge of retirement, have the time needed to weather any temporary dips in order to cash in on the long-term upward trend.


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The Best Values in Public College

Experts highlight the public colleges that offer the best value

With the cost of secondary education at an all-time high and students becoming increasingly aware of the hardships that come with amassing large debts, finding a great value in a college is more important than ever. The organizations that put together college rankings are aware of this fact and are providing important information that parents and students searching for the perfect school should carefully review. With these rankings, it is possible to match your interests and needs with a school that offers a great value.

Even though a degree comes with a hefty price tag, forgoing college altogether is actually not the best way to save in the long run. When potential earnings are considered, it is clear that getting a diploma is still a valuable pursuit.

“In 2010, the median of earnings for young adults with a bachelor’s degree was 114% higher than someone who ends his or her education after high school,” said William McGuinness, a writer for the Huffington Post, citing a study by the National Center for Education Statistics. “That doesn’t mean all colleges and degrees are created equal, though.”

Attending a public college is generally a less expensive option than attending a private institution. Even among public institutions, however, there are definite standouts. Finding the best values are easy, thanks to the Princeton Review’s yearly list of best college values. The 2014 winners for Best Value College can be found at the website http://www.princetonreview.com/best-value-press-release.aspx

The Princeton Review uses more than 30 data points based on information collected over the previous two years when making its choices. Because value depends on both cost and worth, these data points include financial issues, such as attendance costs and financial aid, as well as the merit of each school’s academics.

The top 10 winners for 2013 (in-state schools) are:

1) University of Virginia
2) University of North Carolina (UNC)–Chapel Hill
3) New College of Florida
4) College of William and Mary
5) University of California, Los Angeles
6) North Carolina State University
7) University of Wisconsin–Madison
8) State University of New York at Binghamton
9) University of Michigan–Ann Arbor
10) University of Georgia

Kiplinger’s also searches the country to find the best values in public education. There are several differences on Kiplinger’s list, which highlights the importance of using multiple resources to gain the clearest picture. Kiplinger’s Susannah Snider said that it decides which schools are the best values by looking at both affordability and academic quality, which it assesses by examining factors such as four-year graduation rates and test scores.

Kiplinger’s top 10 for 2013 are:

1) UNC–Chapel Hill
2) University of Virginia
3) University of Florida
4) College of William and Mary
5) University of Maryland, College Park
6) University of California, Los Angeles
7) New College of Florida
8) University of California–Berkeley
9) SUNY Geneseo
10) University of California, San Diego

Snider highlighted the merit of the number one choice, UNC at Chapel Hill, which always makes the list. According to Snider, it is clear why the university scores so high.

“Credit its stellar academics, reasonable sticker price and generous financial aid,” said Snider. “At 77%, Carolina’s four-year graduation rate is about 45 percentage points higher than the average rate for four-year public schools.”

This amazing value is no secret. The school receives many applicants and can afford to be very selective.

“Its 31% admission rate (the percentage of applicants who are accepted out of those who apply) makes it among the most competitive schools on our list,” Snider said.

Putting in the effort to submit a strong application isn’t just important for those wishing to take advantage of the great deal offered by UNC Chapel Hill; it is necessary for scoring a good merit scholarship or financial aid from any school.

“What most people don’t realize is most students aren’t paying the full sticker price. Two-thirds of students are getting financial aid. At nearly 100 of the 150 ‘Best Value Colleges’ we’ve identified, the average freshman grant this year was $10,000 or more,” said Rob Franek, author of The Best Value Colleges and Princeton Review’s vice president of publishing, in an email to the Huffington Post. “When it comes to picking a college, people need to be savvy shoppers and savvy applicants.”

If you use these lists as a jumping-off point to complete research tailored to your own needs for your education, you will be able to find the best college for you at the best price.

If you have any questions about funding your college education, ways to save money or any other financial issues, please give us a call.


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Eco-Friendly Lighting

Save energy and lower utility bills by changing the lighting in your home

A few changes in yourEcoFriendlyLighting2 home lighting can greatly reduce your energy usage, resulting in a cleaner environment and lower utility bills. Whether it’s installing dimmer switches or changing the type of light bulbs you use, even a small adjustment can yield big results.

Dimmer switches
In just a few minutes, you can change regular flip light switches to dimmer switches. Dimmer switches allow you to control the amount of light (or energy) you want to use in a room. By dimming lights in certain rooms or areas when you don’t need full lighting, you can quickly recoup your cost for dimmer switches and see significant energy savings.

Different light bulbs
If you’re using older incandescent light bulbs, you’ll notice energy savings right away if you switch to more energy-efficient bulbs. If you do not want to waste your old incandescent bulbs, continue to use them until they burn out, and gradually replace them with CFL, halogen or LED light bulbs. While these bulbs cost more upfront, they last longer and consume as much as 98 percent less energy than their older counterparts. Energy-efficient bulbs offer a range of hues depending on the type used (e.g., LED bulbs burn with a bright white light), so experiment with several types before deciding on which mood you want to create in your home.

Paint color
Painting your ceilings white or light colors can help overhead lighting disperse light more evenly. Dark colors absorb light, so painting a ceiling or room a very dark color will require a significant amount of energy to illuminate properly. White reflects light.

When an overhead lighting fixture is turned on in a room with a white ceiling, the light is reflected from the ceiling to the entire room. When deciding what colors to paint the main rooms of your home, using white and lighter colors on the ceiling will help you save on energy costs.

Solar power
Focusing on renewable sources of energy, such as solar panels, is the best option for reducing energy usage. During daylight hours, solar panels can provide all the energy needed to light a home. While other sources of energy may be required at night, solar power can greatly reduce the amount of energy your home uses overall. The cost of installing solar panels varies widely, so be sure to shop around and check local, state and federal incentive programs to learn whether this is a viable option for you.

Skylights
While the installation of skylights may not be practical for many, if you are in the process of remodeling your home, skylights are an option to consider. Installing skylights in the main rooms of your home can provide natural light during the day, so you do not need to turn on lighting in some rooms.

Changes in lighting within your home do not need to take place all at once. Begin with one step (such as turning off lights when leaving a room) and then gradually change other habits. Small changes over time can yield big results in energy savings and your utility bills.


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Where to Begin With College Savings Plans

A 529 plan is an affordable, convenient option to help families save for college

College and university costs are increasing nationwide, and many families are considering numerous solutions to prepare for these expenses.

A 529 plan is ideal for those who want to save money quickly, and you can enjoy the following benefits from this option:

• Tax-free funds. All money in 529 plans increases federal and state income tax-free. In addition, all withdrawals used for qualified education expenses are exempt from federal income tax, and many states exempt state income tax for specific college and university costs.
• Low contribution limits. Regardless of a family’s income level, many 529 plans feature low contribution limits that make them worthwhile. In some states, minimum limits are as low as $15.
• Money can be used at many schools. A wide variety of accredited colleges and universities around the country will accept 529 plan funds. The money can be used to cover many student essentials, including book, housing and tuition fees.
• Enhanced protection. Many 529 plans are protected against bankruptcy. In fact, some of these plans enable participants to contribute $300,000 or more.
• Easy setup process. Within a short period of time, families can establish 529 plans that will deliver benefits for years.

How to establish a 529 plan
Professional financial advisors help families develop investment strategies to meet students’ needs. These experts will provide details about two types of 529 plans:

Prepaid plans.
With prepaid plans, participants pay for a year (or a portion of a year) of tuition in advance, which locks in the price. These plans are becoming increasingly valuable because many schools raise their costs annually, and those who can lock in tuition expenses can effectively manage their budgets, no matter how much tuition expenses increase by the time a student enrolls.

Investment plans.
By using these plans, participants can decide how to invest their funds. Meanwhile, investment plans also enable people to determine how to use that money (and the earnings it generated) for numerous educational costs at a variety of higher education institutions.

Enrollees in 529 plans can make a lump-sum contribution of up to $65,000 per beneficiary or $130,000 if married filing jointly and avoid incurring a gift tax on this amount by electing to use five years of the annual gift tax exclusion all in one year. If they take advantage of this provision, the annual exclusion cannot be used again for the same beneficiary until the five-year period has passed.

Learning about the benefits of 529 plans is the first step to help families save money. Qualified financial professionals offer guidance to ensure that participants get the support they need so these enrollees can attend their dream college or university.


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