Category: Save Money

5 Strategies to Shrink Debt

Minimizing your debt can always seem like a mountain of to-do lists. With various recurring payments, differing interest rates, and due dates that never seem to end, it’s easy to feel overwhelmed, and you’re not alone.

While having acredit card, or other outstanding debt, isn’t a situation anyone wants to find themselves in, a surprising 38.1% of American households carry credit card debt.  Couple that with a total household debt average of $134,643.00 and the idea of debt starts to seem more common than you’d think!

While we know that having debt isn’t always the best solution, Peoples Bank & Trust is here to help you conquer it. We’ve found five proven ways to reduce your debt, and stop your spending habits from adding more! Take a look at the five tools below, and see if they help you become debt free!

  • Find New Ways to Save: Whether it’s reducing your grocery bill, finding more affordable clothing options, or simply turning to the cash-only budget. There are numerous ways you can save. In fact, we recommend blogs such as The Simple Dollar, Making Sense of Cents, and Penny Hoarder to continue bolstering your savings knowledge.
  • The Snowball Method: This is by far our favorite way to reduce your overall debts. While you may need to start with finding some new ways to save, once you can allocate some extra dollars, you can put this effective method in action, eliminating your debts. Simply pay the minimum amounts on all outstanding balances, and then using the surplus funds, add to your smallest payment to help pay it off sooner. Once your smallest debt is completely paid, you can rollover the funds being used for that into your next largest debt and so on. Repeat this process until all the debts have been paid off.
  • Refinance Your Current Loans: The snowball method will help you erase debts one by one, however, using this strategy will consolidate those payments in one quick action. Speak with one of our dedicated lenders to see if your home mortgage or personal loan can be refinanced at a lower rate to save on monthly payments. This may make a small dent, but every little bit counts!
  • Freeze the Credit Cards: In order to proactively prevent yourself from overspending, freeze all credit cards you currently have in your possession. This step helps you to force yourself to spend only what you have. If you decide to use cash only, the envelope system may help you save even further!
  • Set Up Automatic Transfers: This one simple trick can save you hundreds each and every year! By using your online banking as a resource, you can use automation to ensure you are never tempted to spend those extra dollars. Instead of waiting for them to be spent, allocate them in your savings plan, and tuck them away for paying down debt or build your emergency fund to eliminate emergency debts.

However you and your family decide to decrease your household’s debt, Peoples Bank & Trust Co. is behind you! We’d love to talk about your family’s financial goals and help you identify the best tools to help you get there. Give us a call, or stop by your nearest branch to get started today.

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

Money Magic Tricks

Money Management

Magic is one type of entertainment that will never go out of style. Whether it’s David Blaine and his shocking stunts, or newly famous films such as Now You See Me, this classic art has proved to truly stand the test of time. While Peoples Bank & Trust may not be the best at sleight of hand, we do have a few savings tricks up our sleeves! See if you can understand the steps to these financial stunts and make your fiscal success appear out of thin air.

Make your money disappear (into your savings!)

Before you’re tempted to spend those hard earned dollars, we’ll show you how to make them vanish, and then reappear! By logging into your online banking, you can set-up recurring monthly transfers for a set amount from your checking to your savings. This way, your funds will get tucked away before you even knew they were there! The extra money saved can contribute to your retirement, education, or even an exciting getaway.

Cut your debt in two.

Tired of paying pesky credit card debt, a mortgage, or student loans? This helpful hack can show you how to saw that number in half, and potentially make it disappear. Financial talk show host Dave Ramsey has a proven method called Snowballing Your Debt. By continuing your monthly minimum payments, and using extra funds to “attack” one debt at a time, you can then rollover extra money from the fully paid loans into paying off the next biggest debt and then the next. Before you know it you’ll be debt free, and looking for another financial trick to master!

See double dollars on your retirement plan.

If you’re like most Americans and need to play a little catch-up on your personal retirement savings, this trick is sure to impress! To really maximize your saved dollars, we recommend diversifying your retirement accounts, by allowing one to be maintained by your employer (401k) and creating a separate account for you to contribute to on your own (IRA.) By automatically withdrawing money from your paycheck through your 401k, you can potentially invest MORE while having it managed through your employer. In addition to this, creating a dedicated IRA to store personal savings dollars in allows you to explicitly manage the growth of your continued contributions. Know what’s better than one retirement savings account? Two!

Pull extra money out of a hat.

Just like magicians, a good budget can help you find things you never knew were there – like money! Whether you’re using traditional methods like the envelope system, or more digital options like the YNAB, the end goal is still the same. To help you save even faster, you can couple your budget with additional savings tips and tricks on common recurring expenditures such as groceries, and you’ll see the savings in no time!

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

10 Ways to Shop Local

Community

Supporting our community is one of the most impactful ways we can help it grow. By shopping with local vendors and utilizing area service providers you and your family can help ensure that our community prospers and grows each year. If you want to shop local, but don’t know where to start, our team at Peoples Bank & Trust has come up with some creative ideas you may not have considered yet.

 

  1. Get produce at your local farmers market.
  2. Purchase floral arrangements from your neighborhood florist instead of online vendors.
  3. Work with local providers for your insurance and wealth management.
  4. Venture out for the night and tour area dining and entertainment establishments.
  5. Bank with a community bank.
  6. Buy groceries from a regional company compared to the large national chains.
  7. Like your favorite area businesses on Facebook and other social media.
  8. Shop for birthdays and holidays at your community’s downtown storefront.
  9. If you have received great service or products from a local business, recommend them to a friend or relative.
  10. Stay local when planning weddings or other milestone events and avoid online alternatives.

 

Owning and managing a small business may be more difficult than you think. We believe that opportunity is everywhere. Whether you’d like to open a business of your own, or simply want to support the ones you enjoy, it’s great to learn what small businesses are all about. That’s why People’s Bank & Trust is excited to share some compelling and surprising facts surrounding the small businesses in our neck of the woods.

 

  • A company is considered a small business if they have less than 500 employees according to the Small Business Administration.
  • 7 percent of all active companies in the United States are classified as small businesses.
  • If your favorite retailer has been in business over ten years, they have officially beat the odds. According to the Bureau of Labor, two out of three small businesses are still operating after two years in business, and only half of small businesses have survived after being open for five years.  Approximately one-third of small businesses last ten years or longer.
  • Cash flow is cited as the more common issue regarding a business’s failure. Associated tasks such as invoicing, timed billing, and record keeping are often the most commonly linked culprits.

 

If your business needs to gain capital for an expansion or start-up, Peoples Bank & Trust is here to help. Our experienced commercial lenders can help you determine your ideal capital amount while also setting up valuable cash flow services Send us your information or stop in today to learn more about this convenient and affordable service.

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

Who Says You Can’t Make a Snowball in the Spring

Debt Elimination

While the weather can be as predictable as the Powerball, one thing that you can always count on through the seasons is your ability to snowball anytime you want. However, before you start creating snowmen out of ice shavings, let’s first cover what a snowball is. Typically in financial terms, snowballing is an action in which you structure your debt payment to decrease the overall time and cost associated with any accounts payable you have.

Here’s how it works: To begin a snowball, you first need to know what debt(s) you have on the table. By creating a list of your known debts, and also checking your credit report for any unknown ones as well, you can ensure you have all your bases covered. Then, using that information, prioritize your debts by amount from smallest to largest. Once you have them organized you can begin to set-up or continue minimum payments across all installments.

For the next step, you’ll want to look through your current spending and earning to see if there are ways you can allocate additional funds each month to pay off your debt. Whether it’s an extra $50 or an extra $500, every penny matters!

These additional funds can then be assigned to the debt you indicated at the lowest amount. Each month you’ll have a little extra money to help pay off that expense even sooner. Once the balance reaches zero, the snowball officially begins! Now that you have eliminated one payment, you can utilize all the funds that were going towards that expenditure and push them towards the debt with the next lowest amount.

Continue to do this process until each unwanted debt is paid off. Debts such as your mortgage are a great thing to pay off early, but may not be necessary to include in your debt snowball. Our helpful mortgage lenders can always assist in restructuring your payments if you are truly passionate about eliminating all debt.

If you’re ready to get started, we have some great money savings tips to help you find those extra dollars!

  • Switch to a Discount Grocer: You could reduce your monthly grocery bill by up to half when you shop at a bulk or discount grocer instead of a brand-oriented chain.
  • Bring Your Coffee and Lunch: Both of these items could be costing you more than you think! The typical American lunch runs approximately $12.00 and an average latte could cost you $3.50 a day. By bringing both food and beverages from home you can drastically decrease your monthly expenditure for dining.
  • Take Advantage of Apps: New technology based tools like Mint, Honey, and RetailMeNot, offer continuous and unique ways to save and manage your personal finances. By taking advantage you can not only save on unexpected items but better visualize your budget through tracked spending categories.

At Peoples Bank & Trust we are excited to help you succeed on your journey toward financial success. If you’d like to set-up automatic payments, or monthly transfers, our Online Banking can help! Visit our website to get started today.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

The Latte Factor 101

Money Management

Making your way through the drive thru every morning before 7:30 may give you a refreshing start to your day, but at what cost? The ideology that coffee shops and other retailers capitalize on is the notion that these small expenditures add a little excitement to your day without a hefty bill. However, when you enjoy perks like these on a daily basis, they add up, and quick!

Financial author, David Bach, is the mastermind behind the Latte Factor. This helpful calculator enables shoppers to see not only the cost of an individual purchase but the lost value it could cause for further investment as well.

For example:

If you purchase a $4.45 grande latte from Starbucks every weekday for the next thirty years, the total cost of your daily coffee is $34,786.29. However, if you had put that weekly $22.25 expenditure into an investment with an average earnings rate of eight percent or more, you could have made $109,225.02 in earned interest during that time. This showcases the true cost of a daily latte as the overall product expense ($34,786.29) + the lost interest ($109,225.02) = ($144,011.30)

While less than $5.00 a day may seem like chump change, compounding these expenses on a long-term level can showcase helpful savings opportunities to maximize your retirement savings efforts and limit unnecessary spending.

This equation doesn’t work just for coffee either! If you find yourself splurging for a fast-food lunch break, buying extra sodas at work, or even paying for a magazine you hardly read, you’ll soon find that all of those little expenses can make a big impact.

To help break some common splurging habits Peoples Bank & Trust recommends the following:

  • Before making a purchase, ask yourself, “Should I spend these funds or should I invest them?”
  • Use free services like our Online Banking to visualize your spending and see areas where you can cut excess.
  • Remember the rule of 7. On average, invested funds will double every seven years, without any added contributions.
  • Utilize accounts like IRA, HSA, and 401(k) to maximize the dollars you invest and save.

If you have any questions on how to get started, or want to learn more about how to make your money work for you, we’re are here to help. Just stop by or drop us a line.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

Why Checking Your Credit Score Matters

Personal Finance

Across television ads, online banners, and even chit-chat among relatives, the phrase, “Check your credit score,” seems to be popping up everywhere. If something so important needs constant reminders, why does it have such a key importance in your personal finances? Well, the truth is that it doesn’t, your financial actions do.

A credit score is comprised of five different components which indicate how you as an individual are perceived in terms of repayment and risk. Individuals who pay their bills on time, have been responsibly utilizing loans and credit cards, and who don’t maintain too much debt typically have a higher score. While the score itself is seen by potential lenders as a positive or a negative, the true meaning it portrays is to showcase whether you as an individual are a promising person to repay any funds you are lent. This score can be changed for the better or the worse depending on the actions you take.

This is why checking the report itself can be beneficial for your personal financial reputation. By reviewing your history on a recurring basis you can quickly identify any mistakes or missed payments that need correcting and do so in a timely manner.

For those who do not check their score scenarios like the following could occur:

Say you accept a job in another town, and after moving, you realize you still need to forward your mail. After a week or two in the new place, you go online and make the switch. However, unbeknownst to you, there was one last utility bill that was mailed to your prior address after you moved away. Weeks go by, even months, only now you’re connected with a new utility company, and you have new bills to pay. Behind the scenes, however, your credit score could be declining, because that one last bill has now been reported to collections. Your credit history will now note that a payment has been missed, and the longer it is missed the more it could damage your credit score.

Situations like this happen to many Americans, and while sometimes they can’t be prevented, the damage they cause can be minimized by checking your credit score on a monthly basis. Instead of allowing a payment like this to retain a balance for over 120 days, you can catch it under 90 and minimize any potential negative effect on your score.

This is just one example in how checking your credit score can impact your financial health for the better. Other benefits include fraud prevention, better financial negotiation, and more accurate personal financial records.

Our team at Peoples Bank & Trust would be happy to walk you through the information from this service and is always available to answer any questions you may have.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

How to Tuck Your Coins Away by St. Paddy’s Day

Savings

St. Patrick’s Day is always reminiscent of older times, filled with meaningful songs and dances, delightfully filling food, and timeless jokes or antics. Each year we celebrate the livelihood of the Emerald Isle, and the heritage of the Irish culture, through a wide variety of events and gatherings. To help your bank account prepare for the festivities, Peoples Bank & Trust offers these tips and tricks to help you save without missing out on the fun!

 

  • Avoid Dining Out ($150/month): The key aspect to achieving this savings is patience! If you can take the time to plan meals ahead of time, and shop only for what you need to make them, you can not only reduce your restaurant spending but your grocery spending as well!
  • Cut Cable ($75/month): With technology like smart TV’s, Fire Sticks, Apple TV, Sling and more, there are now endless options to view and stream your favorite shows without the high cost of cable. By bundling some of these internet based services you can reduce your expenses without limiting your entertainment options.
  • Pack Your Lunch ($100/month): Instead of eating out for ten meals throughout the month, designate two days you’ll bring your lunch from home and save the extra $10 day. You can increase your savings even more by utilizing leftovers from your home-cooked dinner the night before.
  • Carpool ($50/month): While commuting to work may allow you to live in a certain area, it does come at a cost. See if you can reduce that amount by finding fellow co-workers to share the ride in with. While $50 may seem small for a month, over the course of the year that easily becomes $600 or more that you can put toward other saving ventures.
  • Automate Your Savings ($100/month): The phrase, “Pay yourself first,” comes to mind every time we share this tip. Did you know that you can invest in your personal development by contributing your savings goals? Once all the immediate bills such as housing and utilities are paid, we recommend contributing to your savings before budgeting how much to spend in other areas for the month. This way you can make your ongoing financial wellness a priority before deciding on spending habits for the month-to-month purchases.

 

Before the festivities begin, Peoples Bank & Trust challenges you to put these strategic saving tactics into place. If you’re curious how to get started, or want to set up a designated savings account for your extra earnings, our dedicated team is here to help!

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

5 Financially Savvy Ways to Use Your Tax Refund

Personal Finances

Getting your taxes done early not only takes one more thing off your to-do list but further allows you to start planning for the future. Working with your tax professional, determine how much your family may receive this year from a tax refund. No matter the amount, we recommend putting it towards your financial goals for the year. Here are some great strategies we’ve tried to get the best bang for our buck:

  1. Max out your 401(k) or Traditional IRA contributions. If you aren’t taking advantage of one of these two accounts, we highly suggest opening one soon! These tax-beneficial accounts help holders accumulate and grow their funds without the burden of tax at the time of deposit. Each account, however, is limited by how much you can contribute. By allocating funds into these account types it may not only help you save for retirement but also allow your money mature throughout the years, with no additional effort.
  2. Make an extra payment on your mortgage or student loan. Paying down your loan is always a great option when selecting financial goals. In the case of a mortgage, you earn more equity as you pay, while with student loans, you gain more momentum towards financial freedom. Instead of adding money to each monthly installment, we recommend creating one lump payment. By doing this you can you create a single but large decrease in your principal amount owed, drastically reducing your associated interest as well.
  3. Save for the 2017 holiday season. While holiday events, family gatherings, and memories are held dear, the burden of the season can pose potential problems for your personal finances. If you struggled saving last year, now is the perfect time to set aside funds for the holidays. Determine how much you need to pay for each aspect of your seasonal activities, and save as much as possible in a separate account from your tax refund. If additional funds are needed, automate your savings to transfer a specific dollar amount to this account each month.
  4. Pay off outstanding credit card debt. With one of the highest interest rates, credit cards are notorious for taking years to pay off. If you want to make a dent in your debt, we recommend tackling one card at a time.  Using your tax refund, see if you can eliminate smaller debts first. Then with the remaining funds, begin paying down each additional credit card. By paying off the card with the least amount of debt first, you can begin to snowball your way to financial freedom!
  5. Start saving for a vacation. Whether it’s a spring break, a summer adventure, or a fall festival, it’s never too early to start saving. Once you have determined a destination, then create a rough budget of the expected expense. Depending on your refund you may be able to pay for the whole trip outright, or you may need to couple the funds with some additional monthly savings. No matter how you choose to save, we recommend keeping your vacation funds in a separate deposit account so you’re not tempted to use them throughout the year.

If you still have questions on how to best use your tax refund, our personal bankers would love to help. At Peoples Bank & Trust, we can assist you in using all your savings options to help make the most of your money. Stop in and see us today!

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

6 Steps to Scoring Your Savings Goal

Savings Tips

Do your savings goals make you feel frozen? Get back on the ice this season, and let Peoples Bank & Trust help you win your personal financial game. We’ll show you how to keep pushing forward with these strategic hockey tactics:

Find the 5-hole.

One of the first and most important ways to save is to keep your eyes open! Whether it’s taking advantage of grocery store specials, buying household items in bulk, or cutting spending from your monthly budget, the biggest opportunity you have while saving money is continually searching for new ways to save.

Complete the hat-trick.

Before you start saving for the short-term items, be sure you have the long-term set in place. Just as in hockey, there are three things you need to make the best play of the game. Start by setting up an emergency savings account to help guard your savings. Follow up by opening a personal retirement account such as IRA to continually grow your savings. For the last trick of the play, we suggest creating a 529 or Coverdell account to help save for your child’s future education. These three accounts will help not only you score your savings goals but will assist you in winning your entire financial game as well.

Put your debt against the boards.

Show your debt whose boss, and push them against the glass. By aggressively paying off your outstanding debt, you make additional funds available to further your monthly savings. We recommend paying the minimum payment on each debt, and then using any surplus funds to add extra payments to help pay it off sooner. Once you have paid off a debt, use the funds from that allocation to help erase the next obstacle, one payment at a time.

Place your spending in the penalty box.

While working on your savings goals, look into your monthly spending to see where you can cut costs. Consider reducing your funds for eating out and entertainment. The extra money can go towards your debt, or once paid off, can help you achieve your savings goal sooner!

To help, there are some innovative apps available that can you visualize your various expenses.

Beat the buzzer.

Saving for retirement is a marathon, not a sprint. Like hockey, if you don’t play until the end, you may lose the game in the last five minutes. To help prevent this, we recommend working with a personal financial advisor, ensuring your funds are in the right place at the right time. If you make a pass and transfer them to stocks too late, you could lose money and valuable time. We suggest creating a strategic and well-coordinated retirement plan to make certain all your savings get time on the ice, and your key players continue to stay in the game.

Drop your gloves for additional fees.

Whether it’s big banks searching for unnecessary add-ons, or potential financial advisers looking for a percentage of earnings, don’t be afraid to negotiate fees you deem excessive. The business is certain to have referees to let you know if you’re asking too much. However, it never hurts to ask!

With our affordable deposit accounts and expert financial coaching, we look forward to helping you sink your upcoming goal in the back of the net! Stop by and meet our dedicated team today!

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

10 Financial Resolutions for 2017

Money Management

A new year brings exciting opportunities along with the promise of a fresh slate. Start 2017 off on the right foot with these 10 tips from Peoples Bank & Trust Co.:

  1. $1,000 Emergency Fund. Did you know most Americans do not have the savings needed to cover unexpected expenses or bills? By accumulating a decent emergency fund you have the potential to continue saving instead of withdrawing money from your monthly budget for each unplanned expense. Experts say to start with $1,000 and slowly work your way up to a three to six months’ salary of savings.
  2. Maximize Your 401(k). Employers who offer a 401(k) benefit often supplement it by matching a percentage of contributions. To take advantage of their FREE matching, start by contributing at least three percent of your income. Over time, increase it to the maximum amount. These funds will continue to grow over the coming decades and help you to build a well-rounded retirement plan.
  3. Start Saving in an IRA. Similar to the 401(k), an IRA is a great way to help you save money for your retirement. These accounts are not typically provided by your employer, but can be started through a bank or financial adviser. There are two options to choose from: A Traditional IRA  or a Roth IRA. A Traditional IRA will allow you to contribute pre-tax dollars and pay taxes upon receiving distributions at age 60. A Roth IRA will let you contribute post-tax dollars, but you don’t have to pay taxes when you receive distributions after age 60. Both options have a limit to how much you can contribute each year, so start with an affordable amount, and slowly work your way up to the maximum.
  4. File Your Taxes Early. Before the end of the year, every employee should receive their tax forms from their employers. With this information in hand, you can make an appointment with your local tax professional to determine your maximum refund. These funds can then be allocated towards paying down debt, contributing to your IRA, or deposited in your growing savings account.
  5. Save for Your Child’s Education. Children learn a great deal from their parents. Show them how to save, and get them involved with saving for their own education. By making automated transfers each month, you can ensure that you will have a designated amount to invest in their future. By incorporating this into an account like a Coverdell or 529 Plan, you can help these funds grow tax free. They can then be used for educational expenses like tuition, books, or computer equipment.
  6. Pay Off Your Credit Cards. Credit cards are notorious for having sky high interest rates. By paying off your debt quickly, you can save money. To help, our convenient calculator can determine how much you need to allocate each month for a debt-free 2017.
  7. Switch to a Community Bank. Community banks like Peoples Bank & Trust offer impeccable service without the hassle of unwanted fees. Staffed with experienced financial professionals, we have the tools to help you achieve your next financial goal.
  8. Save 10 Percent. Between your retirement, your child’s education, and your emergency fund, you should be covered for most of life’s unexpected expenses. While it’s great to save for the unexpected, having a fun goal to aim for makes the process more exciting by giving you a tangible experience to look forward to.
  9. Monitor Your Credit Score. One of the easiest ways to let your credit score dip is to forget about it! Comprised of payment history, number of accounts, and several other factors, one loose bill has the potential to compromise your entire score. The one federally authorized FREE credit reporting site, annualcreditreport.com, allows every American to have one copy of their credit report from all three reporting bureaus. This is a great tool to use annually; however, each month it is a good idea to check and see if there have been any changes. Many credit cards are now offering a service for this to help their consumers keep on top of their score.
  10. Create a Monthly Budget. Hands down the one change you can make with the biggest impact on your personal finances is to create a monthly budget. By allocating every dollar you earn to a role each month, you can ensure no money is wasted. This will also help you gain better insight into where you’re spending your funds giving you additional opportunities to find savings.

By accomplishing each of these goals in the New Year, you will complete the basic steps to attaining better personal finances. With the help of our dedicated team, you can begin today. Stop by one of our locations and see what your first step could be!

 

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender