- Review your budget. A lot can change in a year. If you’ve been promoted, had a child, or become a new homeowner or renter, be sure to update your budget. Determine what expenses demand the most money and identify areas where you can realistically cut back. Develop a strategy for spending and saving – and stick to it.
- Evaluate and pay down debt. Take a look at how much you owe and what you are paying in interest. Begin paying off existing debt, whether that’s by chipping away at loans with the highest interest rates or eliminating smaller debt first.
- Set up automatic bill pay. By paying recurring bills automatically on the same day each month, you’ll never have to worry about a missed payment impacting your credit score. Plan out your automatic payments to ensure your checking account has an adequate amount of funds when the payments are scheduled to be withdrawn.
- Save for emergencies. About 40 percent of Americans are positioned to cover a $400 emergency expense. You can prepare by opening or adding to a savings account that serves as an “emergency fund.” Ideally, it should hold about three to six months of living expenses in case of sudden financial hardships like losing your job or having to replace your car.
- Go digital. Converting to paperless billing will help keep your house—physical and financial—more clean and organized, and will help protect you from fraud. Utilize your bank's mobile app to check your balance, pay your bills, transfer funds, deposit a check and send money to friends from wherever you are.
- Check your credit report. Every year, you are guaranteed one free credit report from each of the three credit bureaus. Take advantage of these free reports and check them for any possible errors. Mistakes can drag down your score and prevent you from getting a loan, or cause you to pay a higher than necessary interest rate.
Teach Children To Save Month
Spring Cleaning for your Finances
Prevent Tax ID Fraud
Get Financially Fit
April marks annual Teach Children to Save Month
Midstates Bank is partnering with the following local schools to celebrate Teach Children To Save Month:
- AHSTW (Avoca, Hancock, Shelby, Tennant, Walnut) – Elementary, Middle & High School
- Tri-Center Community Schools – Elementary
- Saint Albert Catholic Schools – Middle & High School
- West Harrison Community School District – Middle School
More than 100 local students will explore safe and unsafe places to keep money, spending choices and impact on the environment, banking careers and concepts of visible cash/coin and invisible funds via direct deposits and checks.
Established by the American Bankers Association Foundation in 1997, Teach Children to Save and the Foundation’s other financial education initiatives have helped reached 10.5 million young people through the commitment of more than 260,000 banker volunteers.
“Familiarizing students with financial education fundamentals at an early age puts them on a path to becoming smart money-managing adults,” said Mike Kenealy. “Teach Children to Save is a great opportunity for us to share our passion for financial education and improve our local community.”
Midstates Bank’s Financial Literacy program includes year-round programming for students K-12. The curriculum is designed to meet educational standards in personal finance while reinforcing math concepts, language arts, money management and other academic disciplines.
Midstates Bank offers the following tips for money-savvy parents raising money-smart kids:
- Set the example of a responsible money manager by paying bills on time, being a conscientious spender and an active saver. Children tend to emulate their parents' personal finance habits. Share this Roadmap to Financial Responsibility with your kids.
- Talk openly about money with your kids. Communicate your values and experiences with money. Encourage them to ask you questions, and be prepared to answer them – even the tough ones. See this list of eight ways to talk openly with your kids about saving money.
- Explain the difference between needs and wants, the value of saving and budgeting and the consequences of not doing so.
- Open a savings account for your children and take them with you to make deposits so they can learn how to be hands-on in their money management.
- Let friends and family know about your child’s savings goal. They will be more likely to give cash for special occasions, which means more trips to the bank.
- Put the literacy in financial literacy. Encourage your children to read books that cover various money concepts. Not only will they become strong readers, but they will be smart money managers, too. Click here for a list of titles for all ages.
- Engage your community. Many schools, banks and community organizations share your commitment to creating a money-savvy generation. Engage a coalition of support to provide youth with the education they need to succeed.
As tax season gets underway, Midstates Bank is urging all customers to take extra precaution when filing their return to prevent their exposure to tax fraud.
“Fraudsters are using very clever tactics to get a hold of your personal information and submit false tax claims,” said COO Dee Dee Schmidt. “Consumers must be suspicious of any communication from the IRS ¾ through email, text or social media ¾ that requests personal information, and should keep a watchful eye out for missing W-2s and mail containing sensitive financial information.”
Tax identity fraud takes place when a criminal files a false tax return using a stolen Social Security number in order to fraudulently claim the refund. Identity thieves generally file false claims early in the year and victims are unaware until they file a return and learn one has already been filed in their name.
To help consumers prevent tax ID fraud, Midstates Bank is offering the following tips:
- File early. File your tax return as soon as you’re able giving criminals less time to use your information to file a false return.
- File on a protected Wi-Fi network. If you’re using an online service to file your return, be sure you’re connected to a password-protected personal network. Avoid using public networks like a Wi-Fi hotspot at a coffee shop.
- Use a secure mailbox. If you’re filing by mail, drop your tax return at the post office or an official postal box instead of your mailbox at home. Some criminals look for completed tax return forms in home mailboxes during tax season.
- Find a tax preparer you trust. If you’re planning to hire someone to do your taxes, get recommendations and research a tax preparer thoroughly before handing over all of your financial information.
- Shred what you don’t need. Once you’ve completed your tax return, shred the sensitive documents that you no longer need and safely file away the ones you do.
- Beware of phishing scams by email, text or phone. Scammers may try to solicit sensitive information by impersonating the IRS. Know that the IRS will not contact you by email, text or social media. If the IRS needs information, they will contact you by mail first.
- Keep an eye out for missing mail. Fraudsters look for W-2s, tax refunds or other mail containing your financial information. If you don’t receive your W-2s, and your employer indicates they’ve been mailed, or it looks like it has been previously opened upon delivery, contact the IRS immediately.
If you believe you’re a victim of tax identity theft or if the IRS denies your tax return because one has previously been filed under your name, alert the IRS Identity Protection Specialized Unit at 1-800-908-4490. In addition, you should:
- Respond immediately to any IRS notice and complete IRS Form 14039, Identity Theft Affidavit.
- Contact your bank immediately, and close any accounts opened without your permission or tampered with.
- Contact the three major credit bureaus to place a fraud alert on your credit records:
- Equifax, www.Equifax.com, 1-800-525-6285
- Experian, www.Experian.com, 1-888-397-3742
- TransUnion, www.TransUnion.com, 1-800-680-7289
- Continue to pay your taxes and file your tax return, even if you must do so by paper.
The new year is an ideal time to set new goals, as many vow to become more physically fit or get organized. The new year is also a great time to assess your finances, gain control and stick to a new budget or saving plan. Taking control of your personal finances will allow you to save and prepare for unexpected expenses.
Get financially fit this January. Midstates Bank, in partnership with the American Bankers Association, recommends following the tips below to get started.
- Get Organized. Consider treating yourself to a post-holiday gift of a financial organization system. Alphabetized file folders, or filing systems specifically for financial organization are available in January as people begin to prepare for tax season. Take advantage and start the new year with an organizational system. While you're getting organized, consider buying a shredder to keep your personal information safe from identity theft.
- Create a Budget. Track your income and expenses to see how much money you have coming in and how much you spend. If you have debt, establishing a budget will help you to pay down your debt while saving. Use computer software programs or basic budgeting worksheets to help create your budget. Include as much information as you can and review your budget regularly. Print several copies of this budgeting worksheet to help you get started.
- Identify how you spend your money.
- Set realistic goals, especially if you plan to cut some of your expenses.
- Track your spending and review your budget often.
- Lower Your Debt. Debt from student loans, mortgages and credit cards is nearly unavoidable. Most families carry about $10,000 in credit card debt. Spending more money than you bring in can lead to financial stress. Establish a budget to pay down debts while you save. Points to consider when cutting debt:
- Pay more than the minimum due and pay on time.
- Pay off debt with higher interest rates first.
- Transfer high rate debt to credit cards with a lower interest rate.
- Use credit cards and loans for purchases that will appreciate in value like a home.
- Save for the Unexpected and Beyond
Pay yourself first. Saving is important; it ensures a comfortable future that can endure financial surprises. No matter how old you are, it's never too late to begin saving.
- Save at least 10 percent of your income for retirement. Enroll in a retirement plan or consider optimizing an established retirement plan. Contribute at least the maximum amount that your employer will match. Contributions made to these types of plans are tax deductible. If your employer does not offer a retirement savings plan, many banks offer Individual Retirement Accounts. IRAs offer tax-deferred growth, meaning you pay taxes on your investment gains when you make withdrawals.
- Financial advisors often recommend keeping about three months salary in a savings account in case of financial emergencies like hospital bills or loss of job.
- Increase your contribution as your income increases.
- If you receive direct deposit at work, ask your employer to send a specific amount to your savings account. Because the money is put into an account before you have a chance to spend it, automatic savings plans are an easy and convenient way to save. If your employer doesn't offer direct deposit, many banks allow for automatic transfers from checking to savings accounts.