Wednesday, January 18, 2017

5 Scholarship Myths to Avoid and How CFCU Can Help

Scholarships can be one of the most underutilized sources of financial aid for college. With the cost of college tuition and room and board increasing, never underestimate the value in applying for scholarships.

According to, here are a few of the most common myths students believe when applying for scholarships:
  1. High school students should begin looking for scholarship during their senior year. It is not advisable to wait until your senior year to start looking for scholarships as many deadlines are in January. The sooner you begin the process the better. For students to have a good chance at winning the award, they should start searching by the middle of their junior year. 
  2. Most scholarship amounts are small and not worth the effort of applying. Every little bit counts. You might think that a $1,000 scholarship isn’t much in comparison to the rising cost of tuition and fees, but it definitely helps. The key is in trying to receive more than one source or scholarships. The more money you receive the less debt you will have when you graduate. 
  3. Scholarships are only for students with top honors and GPAs. There are many scholarships out there that are not based on academics. Often, you need a minimum of a 2.5 GPA to apply but that’s not always the case. There are plenty of scholarships that are based off your hobbies, the major you are pursuing, or your community service work. 
  4.  You have to be a high school student to win a scholarship. Scholarships are not just for current high school students. In fact, there are numerous undergraduate and graduate scholarships available. Current college students should visit their financial aid office or speak to their advisor on department-related awards. 
  5.  The application process is a one-time thing. Many scholarships granted through schools require you to reapply each year. You will also want to look for new scholarships and those you may have missed the previous year. 
The key to overcoming these myths and getting scholarships for college is to apply, and apply often! Prospective college students should also ask different local organizations if they grant college scholarships. Don’t overlook the ones offered in your hometown. Odds are you will have a better chance of securing the scholarship if it’s a local organization.

A great example of this is the Community Financial Scholarship Program! We give away thousands of dollars in college scholarship money each year to our student members.

This year we will award 21 students with $1,000 scholarships in honor of Ron Carlson and in memory of Margaret Dunning and George Lawton, all of whom epitomize the credit union's "People Helping People" philosophy. If you are a current student member or know someone who is be sure to check out our complete guidelines and application criteria at

Taking the time to do your research on available scholarships could reduce the total amount needed through student loans. Just remember that every amount helps when you are paying for your education!

Tuesday, January 10, 2017

Financial Freedom: What It Takes To Free Yourself from Work

Everyone dreams of achieving wealth. Maybe you want to travel the world, quit a difficult job or to sleep in on weekdays. These ideas all center on different forms of freedom. Specifically, personal financial freedom: having enough money that you don’t need to work to cover your basic necessities.

Realistically, how much money would it take for you to be that free? It might seem impossible but it’s not. If it’s a goal, or if you’re just curious, consider the following.

1.) What’s your number? 
Traditional retirement planning assumes you withdraw money from an account for all of your expenses, so you expect to spend a certain amount each year. Multiply that number by the number of years you expect to live after retirement, factor in inflation and a modest rate of return, and that’s it. For financial freedom, though, the number is different.

Financial freedom before retirement, or interest-only retirement, means your capital is generating a stable rate of return, which is your only source of income. This is preferable, because you don’t know how long you’ll live.

The math is simple. Multiply your desired yearly income by 66.6 (a 4% annual rate of return, less a 3% rate of interest), and that’s what you’d need. For example, a $50,000 yearly income would require about $3.3 million. That’s a lot, but it’s attainable.

This is especially true if you’re willing to live on less. If you live simply in an area with a low cost of living, you can survive on $30,000. To get there, you’d need just under $2 million. It’s a big number, but it’s reasonable for a person to save in their lifetime.

2.) How can you get there? 
Two habits kill the move toward financial freedom: consumer debt and lifestyle inflation.

Consumer debt includes credit cards, auto loans and other big-ticket purchases. Anything that you’re borrowing money to get that won’t increase in value falls into this category.

Lifestyle inflation is purchasing goods based on the mistaken belief that you need them. Lowering your lifestyle expenses helps you reach financial freedom by lowering your savings target and leaving you with more money to save.

Financial freedom means living below your means for the rest of your life, saving at least half of every paycheck until you have enough to retire on the interest.

3.) Take a shortcut 
Financial freedom doesn’t have to be complete, or forever. Having enough money to last a year of unemployment, or to quit your day job and live off your investments and passion projects can also be a freeing feeling. Reducing your time-frame and increasing your freedom income cuts downs the amount you need to save.

You may not reach your full financial freedom number but don’t give up! You can still get a taste of the intoxicating freedom.

Your Turn: What would you do if you didn’t have to work? Write a book? Spend time with family? Sleep till noon? Let us know in the comments!

Tuesday, January 3, 2017

7 New Year’s Resolutions for a Richer 2017

The New Year is a great time of renewal. That makes it a good time to make bold, decisive changes in your life. Leave behind the baggage that was 2016 and start fresh with a blank slate in 2017. If you’re looking for some resolutions to improve your personal finances, we’re pleased to offer seven ways to make 2017 the year of the dollar!

1.) Track your spending 
Determine where your money goes. Carefully record every dollar you spend for a month; apps like Mint can make this process automatic. Keeping track of where your money ends up may ultimately encourage you to spend more judiciously.

2.) Make a budget 
70% of Americans live financially spontaneous lives, without planned spending. This is a circular problem: If your budget doesn’t include setting aside money for long-term expenses and savings, you’ll end up spending everything on unplanned things and events. Stop the cycle by creating a budget that modifies your spending to be more in line with your priorities.

3.) Get out of debt 
The biggest stumbling block to financial security and saving towards long-term goals is debt. Make the move towards debt reduction this year by adding an extra $50 or $100 to your credit card payments. Alternatively, focus all your payment resources on the highest-interest debt until it’s paid off, then move on to the next highest.

4.) Start an emergency fund 
The best way to avoid going into debt is to have some money available to handle the occasional, yet inevitable, emergency. Set a specific goal, like adding $10 per month to a savings account. At the end of the year, you’ll have more than $100 available in case something goes wrong.

5.) Start a retirement account 
When you have a retirement account, your monthly statements serve as reminders to think about and plan for your retirement. The challenge, though, is taking that first step. Don’t get hung-up on perfection; any kind of retirement account is better than none. If your job offers a 401(k) matching program, sign up to get at least the full matching funds amount – it’s free money. Do a bit of research, then open the account that seems like the best idea.

6.) Automate your savings 
Fighting that impulse to spend what you’ve earmarked for savings is a constant struggle; it’s easiest to take the decision out of your hands. Change your direct deposit to put some of your paycheck directly into a savings account, where you won’t even think about spend it impulsively.

7.) Get educated 
Knowledge is power, and that’s especially true in the world of personal finance. There’s loads of financial information online; resolve to read one personal-finance article a week. This will give you great ideas for improving your financial situation. Happy New Year from all of us at Community Financial Credit Union. We hope you have a safe, happy, and prosperous 2017!

*Community Financial does not endorse the information, content, presentation or accuracy, nor make any warranty, expressed or implied, regarding the websites and/or apps mentioned above.

Tuesday, December 27, 2016

Get These Things Out Of Your Purse Or Wallet Now!

Your wallet can easily become cluttered with loyalty cards, coupons, cash, checks, store credit cards, and a host of identification cards. Not only is an over-stuffed wallet a hassle to carry, it may make identity theft easier.

Give your purse or wallet a good once over. Look for things you don’t regularly need, and take them out! Some things should never be in your purse or wallet. If you see these items as you’re trimming down your daily carry, take them out immediately.

1.) Your Social Security card 
It’s easy enough to stuff the card into your wallet when you need it for identification and then forget about it.

That could be a big mistake. Thieves can use your original Social Security card to apply for all kinds of unsecured debt in your name. Canceling your Social Security number and getting a new one is a complicated, time-consuming process, and you may be liable for fraud as you do so.

Keep yourself safe, and get the card out of your wallet! Put it in a secure location in your home, like a safety lock box.

2.) Receipts 
This is by far the easiest way to accumulate paper in your wallet. You never know which might be needed later and you stick them all into your wallet. Before you know it, you’ve got a novel-sized stack of transactions.

This could be serious trouble if your purse or wallet is ever stolen or lost. Thieves can use the last four digits of your credit card number on a receipt to build a profile of your purchases, and can fish for more information with a merchant who has the card on file, like a cable company or an online retailer.

Think about going paperless. Turn your phone into a digital file box. Information can be encrypted to keep it out of the hands of malicious people, but still accessible to you if you need to check a purchase.

3.) Tons of credit cards 
Every store offers its own card and incentives. Those cards can really add up. Tack on an extra couple of cards for gas purchases, everyday expenses, and work-related stuff and you could easily end up with a wallet or purse full of plastic.

If your wallet or purse is stolen, each one of those cards has to be canceled individually. Forgetting even one can cost hundreds or thousands of dollars. Thin your collection down to the one or two you use regularly. Look for those that can be widely used, provide the lowest fees and best acceptance rates. Put the rest of them into a safe place at home, using them only when you need them.

Once you’re down to your top cards, make a list of their numbers and the steps you’d need to take to cancel them if necessary.

The Digital Age has made having all but the most necessary of physical items completely obsolete, and has also made it easier than ever to keep your world clean, neat, and organized. Make it a priority to clean out your purse or wallet to keep your personal information secure.

Tuesday, December 20, 2016

Charging Ahead: Five Ways to Build Credit

You've got to give yourself some credit. Literally. Fewer than half of Americans use a credit card, and having a financial clean slate could mess things up when they want to get a house or a loan. Build your credit with the following tips:

1. Check your credit score(s). 
Get a free report at and check for correct addresses and bank accounts.

U.S. law entitles you to a free report every year, but because creditors report to three bureaus, credit counselors recommend you pull a copy from each bureau every four months.

2. Monitor your plastic. 
If you're in college and living off ramen noodles, you might not need a credit card yet. These cards are not for supplementing income. You want to build credit so you can buy a house or buy a car later on. If you sign up for a credit card, put something small on it each month like gas for your car, and get into the habit of paying it off right away.

If you already have a credit card and want another, be discerning. You don’t want to open up more lines of credit than you can handle. 

3. Pay on time. 
Start healthy repayment habits now to entice future lenders. Paying for rent, your cell and utilities won't build credit, but not paying on time can ruin it. Good habits will get you what you want later in life.

Budgeting can also help. Aim to spend no more than 29 percent of your income on housing and 35 to 38 percent on your whole household budget, which includes food, car insurance and health care.

4. Care for the credit you have. 
Most states let you do a security freeze on your credit to prevent identity theft, which prevents people from opening new accounts without your knowledge. Do this. Such freezes typically cost $10 or less for all three agencies that track your credit, so skip the expensive companies.

5. Watch your credit limits. 
You don't want to use more than 30 to 50 percent of your available credit. This means if you have a credit card with a $1,000 limit, you shouldn't use your card for more than $500 each month. If you go over, creditors see you as mismanaging your credit because you over-obligate yourself. That shiny new smart phone will have to wait until next month.

In short, as long as you pay off your credit cards on time and in full you're on the right track -- and your scores will reflect that behavior in a positive way. Need help understanding your credit report? Community Financial is here to help and will provide a free credit review. Simply visit a branch near you or call (877) 937-2328.

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