Monthly Archives: August 2021

car

6 Ways to Prepare for Big Purchases

Whether you’re planning your dream vacation or buying a new car, a big purchase needs a big budget, and you need to make sure you’re prepared for it! To help you achieve your goals, we’ve compiled a list of 6 ways to prepare for big purchases. Good luck!

1. Research Your Options

Research affordable options for the big purchase you have in mind. You can do this by keeping an eye out for discounts, holiday sales, comparing prices between retailors and considering buying used instead of new (used car, later model of computer, etc.).

2. Calculate Your Cost

This part is simple, add up how much this item or event will cost you and divide it by the number of months before you’ll need the money. That’s how you’ll know how much to save each month. Be sure to account for taxes and additional fees that might go along with it. For example, if you’re buying a car, you need to add up the price of the vehicle, license, registration and taxes as well.

3. Determine a Timeline

Once you’ve set your goal, you need to determine when you need to accomplish it by. Setting a specific date or time will motivate you to continue savings and provide you with a sense of urgency. Aim for a realistic timeline and remember to always save a little more than what you’re expecting this purchase to cost, in order to account for unexpected fees or changes.

4. Create a Separate Savings Account

Out of sight, out of mind. It’s so tempting to dip into untouched funds in your savings account when you need to buy something or want to treat yourself but keeping this separate from your regular checking and savings will help you resist the temptation.

Open a high-yield savings account with a bank such as ourselves and label the account with the name of your goal – for example, “Dream Vacation.” This will remind you why you’re saving the money and keep you from spending it on clothes or dinners. You can also set up automatic transfers from your checking into your savings account to make sure you stay on track.

5. Contribute Unexpected Funds

Whenever you collect money that you weren’t expecting, transfer it into your savings account. This could mean bonuses, overtime money, garage sale earnings, raises, monetary gifts, a tax refund or something else. Rather than spending it on a new gadget or dinner, put it into your savings and you’ll be thanking yourself later when you make your big purchase sooner than you expected.

6. Apply for a Loan

If you’re looking to purchase a home or a car, you may want to consider getting pre-approved for a loan so while you’re searching for the home or car of your dreams, you have an idea of what you can afford. To apply for a loan, work with a mortgage lender that can help you select the best home loan with an interest rate and other terms suited to your needs.

Whether you need to open a savings account for your big purchase or would like to get pre-approved for a home or auto loan, our team is here to help! Apply for a loan online or set up an appointment to discuss your options with us. We can help you get one step closer to achieving your big purchase!

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

NMLS# 407724

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How to Pay Off Debt Faster

Debt can seem intimidating at first, especially when you’re looking at all the different balances across various accounts and credit cards. Paying off your debt will allow you to increase your income and have a little extra room in your budget for other things. By following a few simple strategies, you can pay off your debt faster than you think.

Follow the tips we’ve provide below to pay off your debt faster.

  1. Review the Amount of Debt You Owe – Find out exactly how much debt you owe. Being able to visualize the total amount of debt will help you create a realistic repayment plan.
  2. Create a Repayment Plan – Track the total amount of debt you owe with an Excel spreadsheet or free smartphone app. Make sure to include the minimum payment amount, interest rate and how much you owe total. List everything from credit cards and personal loans to student loans and your mortgage. Now, determine how much the monthly payment would be.
  3. Pay the Most Expensive Debt Off First – Sort your debt by highest to lowest interest rate and tackle the credit card or loan with the highest rate first. By paying it off first, you’re reducing the overall amount of interest you pay and decreasing your overall debt. Continue paying down debts with the next highest interest rates to save on overall cost.
  4. Pay More Than the Minimum Balance – When you have extra room in your budget, pay more than the minimum balance so you can pay the debt off faster.
  5. Stay On Top of Bill Payments – Use bill reminders and online bill pay to pay your payments on time – this helps you avoid late fees.
  6. Reduce Your Spending – Review your current spending and consider areas where you can reduce it. For example, skipping your daily latte or canceling your subscription to yet another streaming service.
  7. Change Your Habits – Consider your daily habits and routines and if there are adjustments you can make to save money without sacrificing your lifestyle too much. For example, bringing your lunch to work instead of buying it several times per week.
  8. Sell Unwanted Gifts or Household Items – If you have any unused items laying around, such as electronics, books, appliances, clothes, etc., consider selling them off or hosting a garage sale to earn some extra cash.
  9. Consider Debt Consolidation – This option allows borrowers to repay their debt by combining several high-interest rate loans or credit card balances into one new loan with a lower interest rate.
  10. Celebrate – Reward yourself once you reach your goals to maintain your newfound mindset. It can be easy to shift back to old habits, so it’s important to treat yourself occasionally to keep the momentum going.

Interested in debt consolidation or using online bill pay to simplify your payments? We can help! Visit our website to learn more about those options or contact a financial professional for assistance. We’re here to help you create a more financially stable future.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

home

How to Increase Your Home’s Value

Buying a home is a major achievement—and investment! Mortgage payments help build up equity in your home over time, but there are changes and upgrades you can make to your home in order to increase its value, resulting in a bigger return on your investment.

Homeowners should look for simple, cost-effective ways to increase their home’s value, especially if they plan to sell in the future. Take a look at these 5 ways to increase your home’s value and get a stronger return on your investment.

1. Spice Up the Landscaping

Whether you heard it from a real estate agent or on HGTV, curb appeal matters! You want your home’s landscaping to leave a good first impression—on future homebuyers and neighbors alike. Ways to improve your home’s landscaping include:

  • A well-maintained lawn – this is one of the first things people see and is a well-rewarded investment.
  • Neat and tidy garden – keeping your garden tidy leaves buyers thinking it’s easy to maintain, which is always a plus.
  • Clean and lighted pathway – having a clean pathway that’s lined with pretty plants or LED lights leaves a great impression. Repair cracks and pressure wash it to remove built up dirt or grime.

2. Paint, paint, paint!

One of the most cost-effective and easiest upgrades to do to your home is to simply paint it! Adding a fresh coat of paint to each room of your house gives it a newer, refreshed look and ensures that there is no discoloration behind long-standing furniture or stains left by tiny hands. Peeling or outdated paint can be a turn-off and repainting saves the prospective buyer from having to do it themselves. Focus on painting areas like the bathroom and kitchen as those tend to have more wear. Painting the interior can result in a 107% return on investment (ROI).

3. Upgrade Your Bathroom

When searching for a home, buyers consider bathrooms as some of the most important rooms in the house. Bathroom upgrades are some of the most cost effective to upgrade and ensure you get a return on your investment. Some ways you can upgrade your bathroom include:

  • Repainting walls in a neutral, modern coat of paint or removing old wallpaper
  • Painting or refinishing cabinets (or replacing them if you have more room in your budget)
  • Installing matching modern hardware on drawers, cabinets and closets
  • Upgrading lighting, faucets, showerheads, or installing a new toilet
  • Cleaning everything – rid the bathroom of rust stains, scrub all the surfaces and re-caulk areas around the shower, bathtub and tile

Keep the design neutral and light so you can appeal to as many buyers as possible, colors like light blue or gray work well. If you’re looking to save money by doing the bathroom upgrades yourself, plan for a few days of work. For every $1 spent on bathroom renovations, you can make back $1.71 in home value.

4. Upgrade Your Kitchen

Many consider the kitchen to be the heart of the home. Upgrading a kitchen can make a big difference for some buyers. Depending on your budget, you will have to choose between minor or major kitchen upgrades. Below, we’ve listed some ways you can do both:

Minor Kitchen Upgrades

  • Replacing cabinet doors and hardware (but leaving the box of the cabinet)
  • Upgrading to quartz or granite countertops
  • Installing a set of new matching appliances
  • Repainting and adding backsplash throughout
  • Putting in new flooring if existing is outdated, damaged or worn

Major Kitchen Upgrades

  • Adding an island to the kitchen
  • Installing fully new or custom cabinetry throughout
  • Upgrading to more high-end, energy-efficient appliances
  • Replacing flooring with higher quality options and adding or upgrading trim
  • Adding undercabinet LED lighting

If you’re leaning toward making major improvements to your kitchen, we can help! Give us a call or contact us via our website to discuss your financing options for upgrading your home.

5. Make Your Home More Energy Efficient

Upgrading your home’s efficiency can be more affordable than you think. Some of the most popular environmentally friendly ways to increase your home’s value include improving heating and cooling costs, adding energy-efficient lighting and appliances, upgrading windows, doors and siding. Even adding a smart thermostat makes it easier for a homeowner to control the home’s climate from anywhere and allow them to manage their energy costs more easily. Home tech investments can provide a strong selling point for your home and increase its overall comfort, convenience and functionality.

Some upgrades, such as installing solar panels, are more of an investment and you may need to consider financing options to make this upgrade happen.

How Do I Pay for Improvements?

There are several routes you can take when upgrading your home. For upgrades that need to be done professionally, or those you cannot pay for in cash, there are several financing options available.

  • Credit Card – This option may work for you if you are able to pay off the home improvements in a short amount of time.
  • Personal Loan – A personal loan is a great option if you don’t have enough equity built up for a home equity loan or HELOC. These loans don’t require you to put your home or other property up as collateral to get approved. The interest rate for a personal loan will be higher than a home equity loan, but lower than a credit card in many cases.
  • Home Equity Loan or HELOC – A home equity loan is similar to a personal loan in that you receive a lump sum of cash with a fixed interest rate and monthly payment. A home equity line of credit (HELOC) works like a credit card and comes with variable rates and a line of credit that you can borrow against.

If you’re ready to spruce up your home and increase its value, give us a call, apply for a loan or credit card on our website or schedule an appointment with our team to further discuss your options.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

NMLS# 407724

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Looking Ahead: Retirement Savings

Even though it may seem far off into the future, it is never too early to start saving for retirement. If you have an idea of what you want your retirement to look like, it makes it much easier to plan for it and set goals in order to reach that vision. Here are some tips on how you can look ahead toward retirement savings.

Set Your Goals

After all your years of hard work, you’re looking forward to some rest and relaxation—but how will you finance it after you retire? Are you looking forward to traveling the world or just don’t want to worry about finances while you’re hitting the links? Envisioning what you want your lifestyle to look like and when you want to retire will help you determine how much you should put away for retirement.

Find Out How Much Money You Need

Use a retirement planner tool to determine how much income you may need in retirement. You’ll need to enter in your current annual income, how often you’re paid, pre-tax contribution to your retirement account, current retirement savings, estimated Social Security benefit, current age and desired retirement age. You can also adjust your contribution to see how the numbers change.

Save and Invest

Most experts say 10-15% of your income should go toward retirement. If you aren’t comfortable doing that right now, save what you can and increase it 1% every year until you can reach that goal. There are a variety of retirement plans you can enroll in; we’ve listed some of the most common options below.

  • Company sponsored plans such as 401(k), 403(b)
  • Individual Retirement Accounts (IRAs)
  • Roth IRA
  • Various investments such as mutual funds, stocks, bonds

Make Up the Difference

If there is a difference in what you’re saving now and what you may need for the future, there are many options for you to make up the difference.

  • Increase your deferral into your 401(k) retirement plan. Figure out how much it costs per week to increase the deferral by 1%. Then, continue to bump that number up as needed. A great time to do this is when you get a promotion or raise.
  • Make annual contributions to an IRA. This is similar to a 401(k) as it allows you to invest for the long-term and pay taxes on earnings later.
  • Contribute to your 401(k) to catch up to where you need to be.
  • Manage your debt now so you can have more money later, as long-term savings are crucial for your retirement!
  • Boost your savings by delaying retirement. By waiting just an extra year or two, you could help increase your savings and increase your overall retirement budget.
  • Work for a significant promotion or raise and save some of the additional earnings.

Review Your 401(k) or Roth IRA Yearly

Once or twice a year, set aside time to review your 401(k) or Roth IRA. Firstly, review your asset allocation—your retirement accounts should match your goals. Check your progress to see if you’re saving more than anticipated or if you’re not quite there yet and need to make some changes. If you’re not saving as much as you wanted, consider increasing your deferral, adding more money to your IRA or making an extra contribution to catch up to where you want to be. Also, update the beneficiaries on your accounts and make sure your contact information is current.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender