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By Scott Birrenkott

The Wisconsin Bankers Association has provided a resource to assist homeowners with questions regarding options as forbearance periods end and the pandemic still lingers. Generally, there are a few ways borrowers can make up their missed payments. However, the method of repayment can vary depending on the loan. Not all borrowers will be eligible for all options. Borrowers are encouraged to ask their servicer about available options.

Download: Assistance for Homeowners in Forbearance

 

7 Tips To Build Good Financial Habits

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities.

The American Rescue Plan of 2021 was signed into law on March 11, 2021. Consumers will begin receiving Economic Impact Payments (EIPs) — also referred to as stimulus payments — on Wednesday, March 17. Here are the basic details on what the plan entails:

Will I receive a payment?
In general, you are eligible for a payment if you are a U.S. citizen or U.S. resident alien, you were not claimed as a dependent of another taxpayer, and you have a Social Security number valid for employment.

How much will the payment be?
The payments are up to $1,400 for individuals, $2,800 for couples, and an additional $1,400 for each dependent regardless of age. The Internal Revenue Service (IRS) will, in general, use your 2020 tax return if you have already filed or your 2019 tax return if you have not yet filed for 2020. If your adjusted gross income is $75,000 or less ($112,500 for individuals filing as head of household or $150,000 for couples filing jointly), you will receive the full payment amount. The payments will be lower for those with higher incomes, and taxpayers will NOT receive a third-round EIP if their adjusted gross income is more than $80,000 for an individual ($120,0000 if filing as head of household or $160,000 for couples filing jointly).

How will I receive the payment?
Many consumers will receive their payments via direct deposit, however some will receive a paper check or prepaid debit card in the mail. To avoid fees on a prepaid debit card, transfer the balance to your bank account via eipcard.com or use an in-network ATM.

When will I receive the payment?
You can check the status of your payment at www.irs.gov/coronavirus/get-my-payment. The IRS sent an initial wave of EIPs, which is scheduled to be made available in consumers’ bank accounts on March 17.

What happens if my account balance is negative?
Banks have varying policies on how payments will be handled on accounts with negative balances. If you have a negative balance on the bank account the IRS has on file for your tax returns, please refer to your bank for their specific policy.

What do I do if I do not receive my full payment?
If you didn’t receive the full amount you were entitled to (due to the birth of a child in 2020, for example), you can claim it when you file your 2021 taxes.

For more information, please visit www.irs.gov/coronavirus/economic-impact-payments.

By, Cassie Krause

 The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities. An archive of Consumer Columns is available, as well. 

So, you heard you’re getting a $1,200 check from the government. Hurray! … Wait? How is this going to work, exactly?

1: How to get your economic impact payment.
Now that the CARES Act is law, information—and misinformation—is flying around about when, how, and who will receive economic impact payments from the IRS and Treasury Department. Here’s a rundown of the essentials, straight from the source:

  • When: Payments will be distributed automatically beginning in April 2020.
  • Who: Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment of $1,200 for individuals or $2,400 for married couples, with an additional $500 per child. If you filed with more income than that, the payment phases out by $5 for each $100 above the cap, up to $99,000 for individuals and $198,000 for joint filers.
  • How: If you’ve filed a tax return in the past two years (2018 or 2019), you don’t need to do anything. The IRS will direct deposit your payment if you received a refund via direct deposit. If not, the IRS will mail you a check. Need the cash sooner? The Treasury is developing a web portal to allow secure payment via direct deposit. Stay tuned.

If you haven’t filed a tax return, you’ll need to file a simple 2019 return in order to receive your funds.

2: The scammers are at it again.
Bad actors are always out there to take advantage of a crisis. Use the following tips to help protect yourself and your loved ones from becoming a victim:

  • What do the IRS, your bank, and the U.S. Treasury all have in common? None of them will call or email you to get your bank account information in order to mail you a check or direct deposit your funds.
  • If you do get a call or email, hang up and/or delete it. If you think it might be legitimate, end the conversation and contact your bank (or the IRS/Treasury/whoever is claiming to contact you) using the contact information you already have on hand (from bank statements, bills, etc.).
  • Never give out any personal information unless you initiated the conversation.

If you have any questions, contact your bank directly using the phone number you have on file for them, not a number given to you by a potential scammer.

3: Your money is safe in the bank.
If you have scared friends and/or relatives, remind them that the safest place for their cash is in an insured bank or credit union, not under the mattress. Even during “Safer At Home” restrictions, your money will always be available to you. Wisconsin’s banks pay for deposit insurance to keep your cash safe. Many institutions also have robust online and/or mobile systems that allow you to access your funds remotely, and many branches remain open for drive-through service. View a map of the Wisconsin banks with open lobbies or drive-through locations and other helpful resources at www.wisbank.com/COVID-19.

The biggest takeaway for consumers during this challenging time: whether you are a small business owner, furloughed worker, or worried parent trying to homeschool and pay a mortgage at the same time, your bank is ready to step up and help. Reach out and let your banker know what you need.

An archive of Consumer Columns is available here on WBA's website.

By, Amber Seitz

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities. An archive of Consumer Columns is available, as well.

This biggest misconception about saving money is that many people think it's something you do at the end of the month with what you have left over after all of your expenses. The truth is, nobody ever has leftover money. There's always something to spend it on. The better way to think about saving is as something you do first, before you spend anything. This is often called the "pay yourself first" method. Here are a couple of strategies for paying yourself first to build up your savings. 

Create a budget. Perhaps the most important "save first" technique is to figure out how much you can afford to put away each month. Add up all of your essential expenses for the month (bills, loan payments, etc.) and then subtract that amount from your total income. The bottom number tells you how much money you don't need to spend each month. Use that number to decide on the amount you want to "pay yourself" at the beginning of each month. Remember: Don't try to save every penny available. Leave yourself some wiggle room by only committing to saving half or a third of that bottom number. 

Make it automatic. Many Americans with a savings account also have a checking account, and vice versa. Link your accounts together and set up an automatic transfer from checking to savings on the day of or the day after your payday. That way, the money you want to save will never appear in your checking account, making it easier to avoid the temptation to spend. Start small, with amounts in the $25 – $50 range, then gradually build it to $100 – $150 as you find ways to cut your spending each month.

Use direct deposit. If you're not already taking advantage of paycheck deductions through your employer, start as soon as possible. Many employers offer direct deposit to their employees, and one option is to earmark a portion of each paycheck for a savings account, CD, or IRA. Even if you only save $25 each paycheck this way, that money will go directly into your savings fund. 

Consider a CD. No, not the thing "old people" used to play music on back in the days before iPods and smartphones… Certificate of Deposit accounts are federally insured (so you cannot lose the money, even if the financial institution is sold or fails) and mature after a specific period of time (usually one month to five years). Not only is it more difficult to withdraw funds from these accounts, most CDs earn much higher interest rates than savings accounts. They can be a great tool if you find yourself dipping into your savings account on a regular basis for unnecessary expenses.

To find the best way for you to save, talk to your local banker. They'll be able to set you up with the right combination of financial products to help you reach your savings goal, whether it's early retirement or next year's vacation.

An archive of Consumer Columns is available here on WBA's website.

Visit MyMazuma for the latest financial education resources for consumers, including budgeting tools and advice for paying down debt.

 

By, Amber Seitz

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities.

Wisconsin taxpayers may be getting an unexpected windfall thanks to proposed new tax changes. Just like with any windfall, there are wise and unwise ways to spend it. 

Remember that small steps can yield big results over time. Even if you only put $20 each month toward one of these goals, that’s $240 in a single year!

Here are some smart spending choices to help you get the most bang for your extra bucks this year:

Create or Grow Your Emergency Fund
According to a recent consumer survey, 34 percent of Americans do not have an emergency fund. As a result, they have no way to pay for unexpected expenses. An adequate emergency fund should consist of at least three months' worth of all fixed expenses, like mortgage/rent, utilities, food, etc. Whether it's unexpected car repairs, home maintenance, or a medical emergency, you're more likely than not to run into an unplanned expense in the future. Use your windfall to bolster an existing emergency fund or open an interest-bearing savings account to jump-start a new one. 

Pay Off Debt
Windfalls are a good opportunity to make a significant dent in your debt. You can choose between two popular strategies: tackle the highest interest rate first or prioritize by the size of the principle (the non-interest portion of the debt), either paying off the largest or the smallest principle first. Each of these strategies has pros and cons, so be sure to consult an expert before deciding which one is best for you. 

Check Something Off Your "Someday" List
Everyone has a "someday" list. You know: "someday I'll start a college fund for my children," "someday I'll hire a lawyer to write my will," "someday I'll buy a safe for my home," etc. An unexpected financial windfall is the perfect opportunity to check one or more of those items off your list without impacting your usual cash flow.

Look for Long-Term Value
Whatever investment you choose to make with your windfall, be sure that it will provide you long-lasting value. While it's tempting to use that extra cash to purchase a new TV or go on vacation, a more patient approach will give you more satisfaction in the long-run. 

If you have specific questions about how to best use your windfall, ask your local banker.

An archive of Consumer Columns is available here on WBA's website.

Visit MyMazuma for the latest financial education resources for consumers.

By, Amber Seitz

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities.

Elder abuse is a growing issue across Wisconsin and the entire nation. Over the next two decades, Wisconsin's 65 and older population will increase by 72 percent. In 2017, one in nine seniors reported being abused, neglected, or exploited. Law enforcement, advocacy groups, and Wisconsin's bankers are working together to prevent financial exploitation of our state's seniors, and you can help, too! Here's how:

First, understand what financial exploitation is. The U.S. Centers for Disease Control (CDC) defines elder financial abuse as "the illegal, unauthorized, or improper use of an older individual's resources by a caregiver or other person in a trusting relationship, for the benefit of someone other than the older individual." Common examples include forgery, misuse or theft of money or possessions, and use of coercion or deception to surrender finances or property. 

Second, learn to recognize the red flags of financial abuse. Keep a close watch on your elderly family members and friends and look for signs such as unusual spending or withdrawal patterns, frequent purchases of unusual or out-of-character items, unpaid bills and/or utilities being turned off, or the presence of a new "best friend" who is accepting generous "gifts" from the older adult.

Finally, know who the typical perpetrators are. Unfortunately, in most cases the abuser is someone the elderly person knows and trusts. Many times the perpetrator is a family member. They may express feeling that the elderly person's belongings are rightfully theirs. The abuser may have financial difficulties such as a tendency to gamble. They may also express fears that the victim will "use up" all of their savings and deprive the perpetrator of an inheritance. Non-relatives may move from community to community in order to avoid detection. They may also try to gain access to elderly persons by masquerading as a counselor or by finding a job as a caretaker. 

Elderly persons who are most at risk are lonely, isolated, unfamiliar with financial matters, and may have lost someone recently or have mental or physical disabilities. 

By using the information above to identify possible elder financial and reporting it to the authorities, you can help stop or prevent this injustice. 

The Wisconsin Bankers Association and its members have worked closely over the past few months with Wisconsin Attorney General Brad Schimel and his Elder Abuse Task Force in creating an awareness video addressing the issue of elder financial abuse for frontline bank staff. Even though the video is designed to educate bank staff, family and friends of Wisconsin's elders will also find it full of useful information. You can watch the video on YouTube here. 

An archive of Consumer Columns is available online at www.wisbank.com/ConsumerColumns

Visit MyMazuma for the latest financial education resources for consumers.

By, Amber Seitz

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin's communities.

 

Tax season is here, which means you might be deciding between filing yourself or seeking out a professional. However, taxes aren't the only reason to seek out financial advice. An overwhelming majority of U.S. adults do not seek out professional financial advice, while you might not need professional help to create a family budget, expert advice can make the road to retirement, investing, or saving for college much smoother. Check out these common reasons people avoid getting professional financial advice and how to overcome them. 

I'm not rich, so I don't need a professional. 
Achieving financial security requires serious planning, professional help, and strong discipline over a long period of time, no matter what your net worth is. An expert financial planner can help you assess your current situation and help you determine how to reach your goals by building a realistic, comprehensive plan. They can also provide an objective perspective to stressful, emotional decisions, such as what to do with an inheritance. Most importantly, a professional financial advisor will work for you and with you to help you follow your plan by tracking your progress and adjusting your plan if necessary. 

I don't know what questions to ask.
That doesn't matter because you'll start by answering questions, not asking them. A good financial planner will start the relationship by getting to know you and your goals, so they'll be the ones asking questions during your first meeting or two. After that, they will use that profile to guide you in the right direction. The one question you should ask before hiring a financial planner is: How are you paid and what are your fees? Make sure you understand exactly how much you'll be charged for their advice before deciding if that planner is right for you. 

I can't tell if I'm getting good advice. 
It's good to approach financial advice with a healthy level of skepticism, but there are some assurances you can look for to help you verify that your advisor really is working in your best interests. First, check that they are licensed by the State, U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), or the Certified Financial Planner Board of Standards, Inc. (CFP Board). You should also verify that your financial planner is acting in an official fiduciary capacity, meaning they are legally obligated to act in your best interests. The U.S. Department of Labor has a list of questions to ask available on their website.

If you have questions about how to find a financial advisor, talk to your local banker about their financial planning and wealth management services.

An archive of Consumer Columns is available online at www.wisbank.com/ConsumerColumns.

Visit MyMazuma for the latest financial education resources for consumers.

By, Amber Seitz

The Wisconsin Bankers Association offers for your use the following consumer education column. Your bank is free to use this as a community column in your local newspaper, a letter to the editor, a press release or in any other way you see fit. The purpose is to give our members an easy-to-use tool for promoting the banking industry to Wisconsin’s communities.

New Year, New Me, right? We’re a few weeks into the new year and you may have dropped your New Year’s Resolution to become financially fit. Don’t despair. It’s still early in the new year and a great time to clean up your financials, adopt better spending habits, and start saving more. Here are a few tips to keep in mind:

Make a budget and stick with it
This almost cliché financial advice is repeated so often for one important reason: it works. Start by tracking your spending, once you’ve tracked how much money you spend over the course of a few weeks, you can look for trends in what you’re spending. These trends help you start planning on how much income goes towards necessities (like rent/mortgage, utilities, groceries), and see areas where you can cut back (rarely-used subscription services, eating out less) and start putting away a portion of your income towards a savings goal. The most important part of a budget is sticking with it, once you start tracking your spending you should make sure to take time every day or every few days to log your spending and compare that to your planned spending.

Deal with any debt
Debt is an extremely stressful thing to deal with but the new year is a time to get a handle on any debt that may have piled up around the holidays. Debt should be something factored into your budget like your electric bill and tracked. Although it may be daunting, contact your creditors to discuss your situation, they may be willing to work with you to put together a repayment plan. If you're carrying debt on multiple credit cards, talk to your local bank about the possibility of consolidating that debt into a single payment so you can close the extra card accounts. No matter what you do, addressing debt instead of ignoring it will help you get a handle on it and make positive progress.

Shop around
Many times people will stick with whatever they find first, be it their internet provider, car insurance, or brand of soup, but that may not be the best deal, especially a few years down the line. There’s nothing wrong with being loyal to a company but just because they’ve been your cable provider for a few years isn’t necessarily a good reason to stay with them and doesn’t ensure that you are getting the best value for what you are paying. Look around to see what other companies are charging for similar services, you may find that your current company is priced competitively or you may find that you can get a better deal elsewhere. One thing to beware of is a cheaper product or service that is cheaper for a reason, make sure you are still getting a similar quality or ask yourself if you are ok with a downgrade.
Making a commitment to financial health and wellness can be a great way to start the New Year on good footing that can last throughout the year and your life.   

An archive of Consumer Columns is available online at www.wisbank.com/ConsumerColumns

By, Eric Skrum