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Money-saving tips from Select Federal Credit Union in San Antonio, Texas.


save for vacation at a San Antonio credit unionThe kids are out of school and if you’re parents of a typical family, you start thinking of the annual summer family get away. In an ideal world, we all would have fully funded vacation accounts by now but the reality is that most us have not set aside funds for that summer vacation for one reason or the other. If you’re in that boat, here are some tips to help you pay for a summer trip in a few months.  

1. Begin with an expense plan.

Make a decision how much you’ll spend on your vacation. Try to be as specific as you can. Things to consider: plane tickets, or if you’re driving, gas expenses, lodging costs, meals, souvenirs and park or museums fees. Add them up. If the total sends you into panic mode, then adjust your budget until you reach a level of spending that you feel comfortable with. If your funds are tight, then consider taking one or two long weekend trips instead of that big vacation you were dreaming about. 

2. Put off an expense now for fun later.

Look for expenses that you can eliminate now. For example, you could cancel a health club membership or subscription service you are not using or do without cable or satellite TV. If you still have a home phone land line, you could cancel that. By dropping these seldom used services, you can save money now to apply for a family vacation later.

3. Cut eating out and save big.

According to the National Restaurant Association, the typical family with kids will spend an average of $239 each month on eating out. That’s money that can easily be saved for your big trip.

If you don’t want to go totally cold turkey on eliminating eating out, then check local eateries for coupons or “kids eat free” dinners that are often offered on Monday or Tuesday nights. Watch newspaper coupon inserts for buy-one-entree, get-one-free dining deals.

If cooking at home is not possible, frozen dinners or ready-made items at the grocery store can sometimes be less expensive than a restaurant. 

When it comes time for your vacation, consider packing a cooler or picnic basket for your travels stops. While this involves a little work on the trip, it allows you to get away with a much smaller budget. 

4. Have a garage sale or sell things online.

Selling things you don’t need or use can be a great way to raise funds for a vacation very quickly. In today’s day and age, you have the choice of either having a garage sale or selling things on websites like Ebay or Craig’s List. 

To promote your garage sale, run an ad in your local newspaper and post easy-to-read signs around your neighborhood. Always check your local regulations about where you can legally post notices. Keep in mind that kids’ clothes tend to sell better than adult clothes.

For online shopping, be sure to meet people in public places to show them items for sale for safety purposes. 

5. Use your tax refund.

If you receive a tax refund from the IRS, then sock it away in a dedicated savings account that offers a higher interest rate for reduced withdrawal privileges. Select FCU has a special savings account that is designed for these types of occasions. 

6. Use credit cards that pay you back.

In the months leading up to your vacation, try using a credit card that accumulates “rewards” (points or cash rebates) for everything you can: gas, groceries, etc.  

Allow rewards to accumulate, then use them to purchase a plane ticket, hotel room, rental car or gift card for chain restaurants that you’ll visit on your trip. You can locate and compare rewards cards at Bankrate.com. The key is to pay off your balance in full every month. Having vacation debt is not the kind of souvenir or memory you want to collect. 

If you need additional tips, please feel free to reach out to us at Select FCU. We can be reached at (210) 223-6561.

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How to build you credit score in San AntonioWhether you’re struggling with poor or bad credit and can’t a get a loan or just want to get a better interest rate, taking the time to understand the credit scoring system and clean up your credit can really pay off.  

Cleaning up bad credit or building your credit may seem like daunting task but it can be done. A good starting point is to find out what your credit report looks like now. If you haven’t done so, start by getting a free credit report from Annual Credit Report.com.

All consumers are entitled to one credit report annually from each major credit bureau: Equifax, TransUnion and Experian. By staggering your orders so that you get a free report every few months from one reporting agency, you’ll be able to review how your reports change over time.

You also need to understand how your credit score is affected. In general, your credit score is determined by:

·         Whether or not you pay all of your bills on time.

·         How often you pay your bills on time as opposed to how often you pay them late.

·         How long you have had a credit history.

·         How much your credit card limits are.

·         How long it has been since you last applied for credit.

·         What types of credit you have, such as credit cards or mortgages.


Once you know your credit score, then follow the strategies below to get on the path of cleaning up your bad credit or improving your credit score.

1. Remove Errors on Your Credit Report

Once you have your reports, review them to verify that all of your personal information is accurate, such as your address and employer information. Also, review the reports regularly to make sure that your payments have been correctly reported. Be sure to compare the three reports, because a creditor might report to one bureau and skip the other two.

In the event that you discover any errors or find traces of identity fraud, you should contact the credit reporting company to take appropriate steps to correct any errors. This can help clean up your credit.


2. Obtain a Secured Credit Card

One way to rebuild a good track record with credit is to sign up for a credit card that is secured by your own cash deposit. For example, if you make a deposit of $700 with the bank who issues the credit card, then they would give you a card with a limit of $700. By using the card and making payments on it, you can show a steady payment history. To obtain a secured credit card, you will need to work with your bank or credit union. These cards can also be obtained directly from a credit card provider.


3. Take on a Reasonable Amount of Debt

Another way to build good credit is to assume a small amount of debt. For example, you may be able to sign up for a department store card or some type of installment loan. In addition to helping you establish good credit, this strategy can also help you develop your credit history.


4. Build Up Your Savings

Consider opening an emergency savings account at a bank or credit union. Having an emergency fund in a savings account can help with problems that lead to too much credit use. For instance, $1,000 in savings could pay off a medical bill and wouldn’t cost the additional15 percent interest the way a credit card would.


5. Repay Your Creditors

The most important strategy for cleaning up bad credit is simply to repay your creditors. If you get behind on payments, it is helpful to call your creditors and ask for help. They may be able to set up a payment schedule that fits your current budget. It’s critically important that you make your payments on time. Banks and credit unions pay particular attention to your “on-time” payment history. By paying on time, you are establishing that you’re responsible enough to take care of your debts.  If you can, try to pay more than the minimum. The less you pay, the longer you stay in debt.


6. Seek Credit Counseling

Establishing a budget can help you manage and repay your debts, but if you can’t stick to your budget, then you may want to consider credit counseling. Consider using the National Foundation for Credit Counseling: https://www.nfcc.org

Another option is to contact Select Federal Credit Union for guidance. 


7. Beware of Credit Repair Scams

While credit counseling can be useful, always be wary of credit repair scams. Never pay large fees upfront to a credit repair agency. Take the time to learn about your rights, what to look for when obtaining a consolidation loan in general and the specific terms of repair programs. Also, be sure to research and get references for those who offer to help.


While there are many strategies and programs to help you repair and build your credit, ultimately, you are the only one who can take charge and make it happen. If you take the steps we have listed above and diligently follow the recommended practices, you’ll make steady progress and clean up your credit over time.


To obtain a trustworthy consolidation loan or secured credit card in the San Antonio area, contact Select Federal Credit Union at (210) 223-6561. To obtain free financial counseling, contact the Financial Empowerment Center at (210) 431-4425.

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Financial tips from Select FCU, San Antonio area credit union

mom daughter debit credit card w cprt  comodigit smallerAmong the many challenges that parents face is how can a parent raise financially savvy children in the digital world we live in now. Today’s kids have access to an enormous amount of marketing information through social media and the internet that can make an impact on their financial choices. Below are several strategies that concerned parents can follow to pass on smart financial practices to your children as they grow up.


Be a Role Model

When it comes to teaching smart financial practices to your children, the best way is to practice smart finances yourself. Teach your kids the importance of spending less than you earn and working towards debt elimination. Be an example to your kids by setting financial goals and then working towards meeting them. The reality is that you can’t expect to pass on smart financial lessons if you’re not practicing sound financial behavior yourself. Walk the walk before you talk the talk.


Have a Consistent Allowance Practice

There are varying arguments that can be made in regards to giving your children an allowance or not. Some would argue that an allowance teaches your children some basic ideas of managing money. Others argue that it comes down to paying kids for household chores they would do anyway. Regardless where you stand on the notion of allowances, the key here is to be consistent in your approach. If you do decide to give your children an allowance then use the allowance as an opportunity to teach your children basic smart money management.

Teach the Importance of Saving

Whether your children receive an allowance or work to earn their money, it’s critical to teach the importance of saving some money for future use. As mentioned before, this requires that you model this behavior if you expect your child to truly learn the lessons of saving money. Putting money aside is a great opportunity to learn lessons around setting financial goals such as saving for college or perhaps saving for an expensive item such as a computer.


Look for Entrepreneurial Opportunities

Encourage your children to develop an entrepreneurial mindset. One approach is to encourage your kids to launch a micro-business such as a lemonade stand or lawn mowing business. The basic lesson here is that in order to earn money you have to invest money first. Another idea to consider is to create a “job board” that is different from the typical household chores. Children can take on jobs as they choose and earn extra money when the job is completed.

Lessons for Teenagers

As your children grow into teenagers, it’s a good idea to introduce them to the realities of adult finances one piece at a time. The main lesson here is to teach your teenager how adult finances actually work. One approach is to initially introduce them to bills that are associated with themselves such as the internet bill or the cell phone bill. Sit down with your teenager and explain to them what amount needs to be paid each month in order to have that service. Another approach is to share the monthly budget with your older teenager. This gives them a visual of how the household finances are being managed and the importance of living within the household income. This approach works to emphasize that you have to spend less than you earn in order to build a solid financial future.

Communication is Key

If you’re not talking and actively engaging with your children about financial ideas, then none of the strategies listed above will matter. The simple practice of talking with your children about money goes a long way in ensuring that your children understand the value of sound financial practices. Explain to them why you are saving money, why having a budget and sticking to it is important, and why it’s important to live within your means. Children will listen and pay attention to you if speak with them and not to them.

Passing on financial lessons to your children is one the most important responsibilities that parents need to be mindful about and consistently practice. The road to financial success for your children starts with you as responsible parents. 

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San Antonio area credit union cosigning article photo

Tips from Select FCU in San Antonio, TX

Have you ever been asked to be a cosigner on a loan or considered offering it as an option to a friend or family member? Being a cosigner on a loan has value especially when cosigning helps people obtain a first-time loan. However, there are risks to being a cosigner.


Cosigning on a Loan: Reasons Why it’s Useful

While many experts will tell you to never cosign a loan, it isn’t always a bad idea. Here are a couple of sound reasons when cosigning makes sense:

1. It Aids in Obtaining Financing.

Often times applicants for a loan are rejected for a loan because of poor credit history.

But sometimes, creditors and lenders will take a second look at an application if there’s a cosigner. By taking a chance and cosigning, it can give someone the opportunity to obtain reliable transportation, attend school or buy a large ticket item.

2. It Helps Build Credit.

The reality is that credit is needed to build credit. Unfortunately, it can be a challenge for people without a credit history to qualify for a loan. As a cosigner on a loan, you can help another person establish or build a better credit score and credit history.

When Not to Cosign a Loan.

Before agreeing to cosign a loan, you need to be aware of and understand the risks involved. While it makes sense in some situations, many times the risks greatly outweigh the benefits. Before agreeing to cosign, understand the possible risks:

1. It Increases Your Debt-to-Income Ratio.

Your debt-to-income ratio is the percentage of your debt payments in relation to your income. Calculating your debt-to-income ratio (DTI) is relatively simple. Divide your monthly debt payments by your monthly income. For example, someone who earns $6,000 a month and has debt payments of $4,500 has a debt-to-income ratio of 75 percent.

Often times people fail to realize how cosigning impacts their own debt-to-income ratio. As a cosigner, you are legally tied to the loan. You’re required to attend the loan closing and sign the loan documents. A loan that you cosign appears on your credit report, and the monthly loan payment factors into your debt-to-income ratio – even if the primary applicant makes the payment each month. You are liable for this balance in the event of default by the primary applicant. Being a cosigner can also decrease your ability to get new credit.

There are consequences of having a higher debt-to-income ratio. Cosigning a loan can lower your credit score because the amounts you owe makes up 30 percent of your FICO score. The more debt you have, the lower your credit score. Realistically, your debt-to-income ratio should be no higher than 36 percent. Your credit score will drop as your debt approaches or exceeds this percentage. As you can see, being a cosigner is a serious commitment.

2. You Can’t Remove Yourself as a Cosigner.

Once you accept the responsibility as a cosigner and sign the loan documents, you are tied to the debt until it is paid off. You cannot negotiate with the lender to take your name off the loan. In some instances, the lender may include a cosigner release clause in the loan agreement, which removes you as cosigner once the primary applicant demonstrates a history of timeliness. These clauses are common with student loans.

Otherwise, the only way to remove your name as cosigner is for the primary applicant to refinance the loan and re-qualify on his or her own.

3. You Could Ruin Your Credit.

Often times deciding to cosign on a loan is driven by a willingness to help a loved one or a friend but emotions shouldn’t guide your decision. There is a reason why this person can’t qualify for a loan on their own. If the primary applicant doesn’t have a prior credit history, then that is understandable. However, if the person requesting a cosigner has a history of defaulting on loans or paying bills late, then you need to be very cautious. If the primary applicant defaults on the loan, then your credit score will take a hit.

Keep in mind that this loan appears on your credit report. Therefore, any lateness or skipped payment will be noted on your credit report. So, while being a cosigner on a loan has some benefits you need to seriously evaluate whether cosigning is worth the financial and credit risk.

4. Your Relationships Could Become Strained.

In the beginning, most people co-sign a loan because they have a good relationship with the person they are cosigning with whether it’s a family member or good friend. However, if the person you cosign with should default on the loan and you become liable to make the payments, bad feelings can quickly follow and lead to a damaged relationship. So, be sure to prepared emotionally that you will accept this risk and happily make the payments if the other person is unable to - without holding a grudge.

When does cosigning make sense?

While there is really no valid financial reason to cosign a loan, cosigning is ultimately a personal decision. In some situations, your personal reasons for cosigning may outweigh the financial risks. For example, you might consider cosigning on a credit card application or an apartment lease for your child to help them become financially independent quicker. The bottom line: always proceed with a great deal of caution when considering cosigning on a loan.

For further information about cosigning or obtaining a loan, please feel free to contact Select FCU at (210) 223-6561.


Source: Money Crashers

 

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tax refund w cprt rutchapongTax season has arrived and many us will receive a refund from the IRS. When this occurs, you might be tempted to go on a vacation, buy new clothes, etc. While sometimes these things are much needed, there are several other things you can do with the money that can make you even more money over the long run.

To help guide your decision on how to use the refund, here are four ideas:

1.      Start or build an emergency fund. According to a recent Bankrate survey, nearly 3 out of 10 Americans have no emergency savings. Financial advisors recommend that you have at least 6 months' worth of expenses saved in a savings account. Having an emergency fund can provide a strong financial cushion should an unexpected expense come up, such as an expensive car repair or an emergency room visit. If you have the funds available, you will avoid having to get an emergency loan with higher interest rates.

2.      Apply the refund to clear credit card debt. This is particularly helpful if you are paying high interest rates. Eliminating this type of debt can save you countless dollars in interest and give you room in your budget to begin working on paying off other lower interest debt.

3.      Save for retirement. It’s common knowledge that many of us aren't saving enough for retirement. Using your tax refund towards funding your retirement will allow you to earn interest and create more money for your future. If you don't have a workplace retirement plan, you can open a traditional or Roth IRA. A financial planner can help you determine the best route to take to maximize your money’s growth.

4.      Open a 529 college savings plan for your children. The contributions aren't deducted from income for tax purposes, but when the money is withdrawn to pay for college costs, the distribution is tax free, as long as it is used for educational purposes.

If you have received a tax refund and are looking for a place to start an emergency fund, Select FCU has several options including savings accounts and share certificates(CD) that earn a higher interest rate. To learn more, just give us a call at (210) 223-6561.

 

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Select FCU Credit Union in San Antonio Financial Resolutions for 2017 The beginning of a new year is traditionally a good time to set goals or resolutions to improve our health by starting on a healthy diet and getting in shape physically. As we start a new year, we should also be setting resolutions to improve our financial health. Whether you are a member of Select Federal Credit Union in San Antonio or banking in another locating around the world, setting financial resolutions is an excellent strategy that can lead to increasing your wealth and giving you peace of mind. Below are 10 resolutions that you can make for the coming year.


1.   Educate Yourself About Personal Finance

Studies indicate that less than 60 percent of adults in countries with major economies like the United States are financially literate. Resolve to take that step to learn as much as you can about improving your financial wellness. You can start by searching the Internet. In this era where digital information is easily accessible, you can find an enormous amount of expert financial advice online regarding budgeting, saving, investments and retirement planning. If you like to learn in person, there are also classes available through churches and community organizations.

2.   Create and Stick to a Realistic Budget

A budget is simply a spending plan. Lay out your spending priorities for the week, month and year focusing on necessary expenses as well as savings for retirement and emergencies like car repairs. Setting up a budget is the easy part. Sticking to a budget is the real challenge. The key is to make sure your budget is realistic and then resolve to stick to it. It can also be helpful to make a plan to reward yourself for sticking to your budget.

3.     Spend Your Money Wisely

According to numerous studies, one of the top financial resolutions in this country is to spend less. The reason this is a top resolution is because it is relatively easy to spend money recklessly. The best way to cut spending and spend wisely is to track the flow of where your dollars are going to each month. This should help you visualize how much you are spending on unnecessary things. Avoid the temptation to keep up with the Joneses. If you are truly serious about cutting back on your spending, then try to connect with individuals who are trying to do the same.

4. Increase Your Income

Realistically, you can only curb your spending so much. If you’ve reached a point where you have cut back on unnecessary expenses as much as possible, then think about finding ways to boost your income.  Be realistic about finding additional flows of income. It may require you to work extra hours or invest time to educate yourself for a higher paid position. Another recommendation would be to build a side business around something that you love doing.

5. Start an Emergency Fund

It’s a well-known fact that Americans in general are not good savers.  A large percentage of Americans has less than $1,000 in their savings accounts. This indicates that the majority of people most likely do not have enough dollars saved for unexpected expenses.  If you fall under this group of people then you need to resolve to build your emergency fund. Financial advisors recommend setting aside enough money for six months of expenses. This money should be kept in an interest-bearing account such as a Money Market. To begin building your emergency fund, look for areas in your budget where money is “leaking” out (such as eating out) that can easily be controlled or eliminated.  Resolve to stick with this strategy. Unexpected expenses can spell trouble if you’re not prepared. 

 6. Boost Your Retirement Savings

Financial experts recommend setting aside 15 percent of your income in order to have a comfortable retirement. You can start by contributing enough in your 401k plan to get the matching contribution from your employer. You should also resolve to increase your contributions to your 401k plan every year. A one percent increase every year will get you to the ideal contribution of 15 percent. If you receive a raise in 2017, put that extra amount in your retirement fund. 

7. Pay Off Debt

Paying off credit cards should be one of your top resolutions for 2017. Begin by focusing on paying down high interest credit card debt. This debt is typically more expensive than your mortgage or student loans. If you start by paying off debt accounts with the lowest balance, you will see results faster and it will motivate you to keep at it as you tackle debt with higher balances.

8. Plan on Tackling Other Debt

If your credit card is relative small or non-existent, then resolve to tackle other debt that may be creating pressure on your finances. Other debt may include your mortgage, student loans or a car loan. For example, you can work towards paying down your mortgage by paying a little more towards the principle of the loan each month or year. You may have to cut spending in other areas of your budget or perhaps find ways to earn more money. In the end, you will be rewarded by reducing your debt significantly.

9. Consider Starting a College Fund

If you have kids that may be heading to college at some point, then you should start a college savings fund. You can start a savings account through your credit union or bank. One good option for college savings is a 529 plan. These state operated plans allow you to with draw money tax free as long as the money is used to pay for qualified educational costs. A great source of information on 529 plans is SavingforCollege.com where you can research the various plans available as well as having tools you can use to help guide you to the best options available.

10. Resolve to Develop Common Goals with Your Significant Other

If not managed well, household finances can be the source of conflict between couples. If you are married or in a long-term relationship, then you need to work on creating a financial plan and goals together as a couple. Sadly, when couples try to manage their finances separately, it usually doesn’t work. To resolve this, you can start by combining finances under a joint bank account. Next, it’s helpful to work together to create a monthly spending plan or budget based on your shared values and goals. If this ends up being a real struggle for you, there are classes available at local churches that can help you learn to work together on finances.

As always, Select FCU is a great source of information to help you reach your financial goals in 2017. Please feel free to get in touch if you need have any questions or are looking for solutions to challenges. Just give us a call at (210) 223-6561.

 

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1914 N Interstate 35
San Antonio, TX 78208

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