Tag: financial education

A hand drops a coin into a piggy bank, illustrating how the habit of saving can help you master your money.

Nine Ways to Master Your Money

posted on

July 15, 2025

1. Set S.M.A.R.T. goals

Saving tends to be easier when you have a certain purpose in mind: Saving for your first house, your retirement at a certain age, a child’s college education, or even a trip around the world. The important thing is for your goals to be specific, measurable, actionable, realistic and time-bound, or SMART. 

 

To develop a sound plan, these goals must have both a time frame and a dollar amount that is MEASURABLE. Once you have listed and quantified your goals, you need to prioritize them. You may find, for example, that saving for a new home is more important than buying a new car. 

 

Whatever your objective, be SPECIFIC. Figure out how many weeks or months there are between now and when you want to reach your target. Divide the estimated cost by the number of weeks or months to make it ACTIONABLE. That’s how much you’ll need to save each week or month to have enough money set aside. Ask yourself, is this REALISTIC? Remember, a goal is a dream with a deadline.

2. Pay yourself first

Save and invest 5-10% of your gross annual income. Of course, this can be much harder than it sounds. If you’re currently living from paycheck to paycheck without any real opportunity to get ahead, begin by creating a solid spending plan after tracking all monthly expenses. 

Once you figure out how you can control your discretionary spending, you can then redirect the money into a savings account. For many people, a good way to start saving regularly is to have a small amount transferred automatically from their paycheck to a savings account or mutual fund. The idea: If you don’t see it, you don’t miss it. 

3. Maintain an emergency fund

Before you commit your newfound savings to volatile and hard-to-reach investments, make sure you have at least three to six months’ worth of expenses saved in an emergency fund to see yourself through difficult times. Keeping it liquid will ensure that you don’t have to sell investments when their prices are down, and guarantee that you can always get to your money quickly. 

 

If you have trouble deciding how much you need to keep on hand, begin by considering the standard expenses you have in a month, and then estimate all the expenses you might have in the future (possible insurance deductibles and other emergencies). Generally, if you spend a larger portion of your income on discretionary expenses that you could cut easily in a financial crisis, the less money you need to keep on hand in your emergency account. If you have dependents, you’d want to keep more money in your emergency fund to offset the greater risk. 

4. Pay off your credit card debt

If you’re trying to save while carrying a large credit card balance at, say, 19.8%, realize that paying off the debt is a guaranteed return of nearly 20% per year. Once you pay off your credit cards, use them only for convenience, and pay off the balance each month. If you tend to run up credit card charges, get rid of the credit card and go back to using cash, checks and a debit card. 

5. Insure your family adequately

A major lawsuit, unexpected illness, or accident can be financially devastating if you lack proper insurance. The key to insurance is to cover only financial losses so large that you could not cope with them and remain financially fit (known as the law of large numbers). If someone is dependent on your income, you need adequate life insurance. Long-term disability coverage is important as long as you need employment income. Also, be sure to carry adequate liability coverage on your home and auto policies. 

 

To save on annual premiums, it might be feasible for you to raise your insurance deductible, or eliminate dual coverage. And whenever purchasing insurance – life, home, disability, or auto – be sure to shop around, and buy only from a reputable firm. 

6. Buy a home

According to the US census, since 1968, the median price of new single-family homes has gone up almost tenfold; many houses still appreciate at a rate of 6% to 8% annually. Further, home ownership entitles you to major tax breaks. Interest on first and second home mortgages is fully deductible, meaning Uncle Sam helps subsidize your property investment. Additionally, the equity in your home can be a great source of retirement income. 

 

Through a reverse mortgage, homeowners can access the equity in their home without having to sell, and have the option of receiving monthly income for life (or chosen term) or opening up a credit line against the home’s value.

7. Take advantage of tax-deferred investments

If your employer has a tax-deferred investment plan like a 401(k) or 403(b), use it. Often, employers will match your investment. Even if they don’t, no taxes are due on your contributions or earnings until you retire and begin withdrawing the funds. Tax-deferred savings means that your investments can grow much faster than they would otherwise. The same is true of IRAs, although the maximum amount you can invest annually in an IRA is substantially less than what you can put in a 401(k) or 403(b). 

8. Diversify your investments

When it comes to managing risk to maximize your return, it pays to diversify. First you need to diversify among the three major asset classes: cash, stocks and bonds. Once you have decided on an allocation strategy among these three investment classes, it is important to diversify within each asset. This means buying multiple stocks within a variety of industries and holding bonds of varying maturities. Simply put, don’t put all your eggs in one basket. Also, don’t make the mistake of putting most or all of your money in “safe” investments like savings accounts, CDs and money market funds. Over the long haul, inflation and taxes will devour the purchasing power of your money in these “safe havens."

 

All investments involve some trade-off between risk and return. Diversification reduces unnecessary risk by spreading your money among a variety of investments. Aside from diversification, the single most effective strategy is to invest continuously over time, with a long-term perspective. 

9. Write a will

The simplest way to ensure that your funds, property and personal effects will be distributed according to your wishes is to prepare a will. A will is a legal document that ensures that your assets will be given to family members or other beneficiaries you designate. Having a will is especially important if you have young children because it gives you the opportunity to designate a guardian for them in the event of your death. Although wills are simple to create, about half of all Americans die intestate, or without a will. With no will to indicate your wishes, the court steps in and distributes your property according to the laws of your state. If you have no apparent heirs and die without a will, it’s even possible that the state may claim your estate. 

 

To begin, take an inventory of your assets, outline your objectives and determine to which friends and family you wish to pass your belongings to. Then, when drafting a will, be sure to include the following: name a guardian for your children, name an executor, specify an alternate beneficiary and use a residuary clause which typically reads “I give the remainder of my estate to …” Once your will is drafted, you won’t have to think about it again unless your wishes or your financial situation changes substantially. 

 

This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA. 

Article Credit: BALANCE 

A couple discusses a written will, illustrating an introduction to the basics of wills and living trusts.

Wills and Living Trusts: The Basics

posted on

July 1, 2025

Preparing for the distribution of your estate (assets you own at the time of your death) can be a very stressful experience. After all, with so many important decisions to make, no one wants to make the wrong one. One of the most common dilemmas is whether to have a will or a living trust – or both. Knowing the fundamentals of each will help you make the right decision. 

 

Begin with understanding probate, as it plays a significant role in estate planning. Probate is the administrative and court process that takes place after you die. It includes proving the validity of a will (if there is one), identifying, inventorying, and appraising property, paying debts and taxes, and (finally), distributing whatever assets remain. 

 

Because probate can drag on for months or even years, much of the wealth you’ve accumulated over your lifetime can be eroded. Wills and trusts have the power to reduce probate dramatically, so that your heirs can efficiently inherit what you want them to receive. 

Wills 

A will is nothing more than a set of instructions that specifies who gets what of your assets. If you have property and loved ones, having a will is vital. If you die without one, state law takes over and makes distribution decisions on your behalf. In most cases everything goes to your spouse and/or children. If you have neither, your closest relatives will be the recipients, and if you have no relatives, your entire estate will be absorbed by the state. While the court may make the same decisions you would have, in many cases it does not. 

 

One of the most compelling reasons to draw up a will is if you have children who depend on you for care. A will allows you to stipulate guardianship. Without one, the court will make this very personal choice for you. 

 

If your estate is relatively simple, you may choose to create your own will with the help of a quality software program or guidebook. For more complex situations – or if you don’t feel comfortable writing your own will – hire an attorney or legal service to do it for you. Because this is such an essential document, you’ll want to be sure it’s done right. Consider investing in a lawyer to at least look over your finished product. 

Living trusts 

A living trust is a bit more complicated in concept than a will, but in essence it’s a separate legal entity that holds title or ownership to your property and assets. While you’re alive, and acting as the trustee, you hold full control over all the property held in the trust. 

 

The primary reason to create a living trust is to avoid probate. Property held in a trust won’t have to go through probate before your loved ones receive their inheritance. Where wills are public, trusts are private, and usually harder to contest. 

 

As with a will, you can create your own living trust by using software and guidebooks developed for “do-it-yourselfers.” However, living trusts by nature are often more involved than wills, so having a lawyer draw it up for you in the first place may be the better way to go. 

 

Not everyone needs a living trust though. Before spending the money to create one, be aware that they can be costly to arrange, are time-consuming to put together, and require considerable ongoing maintenance (adding to the cost). Changes to a trust can take a long time, and moving certain assets such as real estate, savings, and brokerage accounts into the trust requires re-titling, which can be cumbersome. 

A will plus a trust 

Wills and living trusts are not mutually exclusive estate planning devices. In fact, if you have a trust, you should probably have a will to make sure all your assets will be distributed according to your wishes. Most trusts do not provide instructions for everything in your estate. A will acts as a backup for what’s not included in the trust, as it would have a clause naming a person you want to receive all leftover property. Without a will, anything you didn’t transfer into the trust will go through that long and expensive probate process. Once again, those assets will be distributed according to state law – and most likely not the way you would choose to have your property dispersed. 

 

While estate planning certainly can be an anxiety-provoking process, knowing the fundamentals of wills and living trusts should ease some discomfort. 

 

This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA. 

Article Credit: BALANCE

 

Three stacks of coins of increasing height, topped with a bit of soil and small plant sprouts growing from them, to represent building wealth.

Daily Habits That Make Building Wealth Easier

posted on

June 16, 2025

It is easy to think of wealth as something that happens overnight. The media often emphasizes rags to riches stories, forgetting how rare those scenarios are. News sites share stories of happy lottery winners, reports that overlook the enormous odds ticket buyers face.

 

Given these misperceptions, it is easy to see why so many people haven’t taken the steps that could help them achieve their financial goals. Goals that may seem unattainable. With discipline and hard work, building wealth is possible. Here are a few strategies and everyday habits that can make wealth building easier.

Pay yourself first

Pay yourself first, or “PYF,” is perhaps the most effective wealth-building habit and one of the easiest to implement. With this simple strategy, you direct part of every paycheck to a savings account, mutual fund, or other investment vehicle, forcing yourself to live on less than you make.

Know how much is in your accounts

There is a reason why financial institutions make so much money on overdraft fees. A shocking number of account holders have no idea how much money is in their account. As a result, they are blindsided when writing a check or withdrawing cash from an ATM sends their balances negative. Knowing how much is in the account is an essential first step toward controlling unexpected costs and taking control of your finances.

Prioritize fee reduction and demand real value for your money

Those who manage to build wealth know that prioritizing fee reduction is a vital first step and that every dollar not spent on management costs is one more dollar that can be invested. The wealthy, and those on their way, always demand value for the money they spend on their investments.

Deposit (or invest) raises, bonuses, and other found money

If you want to build wealth, start by putting bonuses and other found money in a savings account or investing the cash in a mutual fund or other low-cost investment. When wealth builders get extra money, they avoid lifestyle inflation, opting instead to beef up their savings and investment accounts.

Take advantage of tax savings

From 401(k) contributions to IRA accounts to health savings accounts, some types of investments have a double and even triple advantage. One of the most effective ways to build wealth is to prioritize investments that offer tax savings and the promise of tax-free withdrawals. Consult a tax advisor to determine the best strategies for your situation.

Develop multiple streams of income

One of the fastest ways to build wealth is to bring in extra money, which starts with developing multiple income streams. That could be a side hustle, a home-based business, or even rental real estate. The idea is to generate extra cash, money that can be saved and invested.

Save on everyday purchases

People who are successful at building wealth look for ways to save money on everyday purchases. These people choose generic and store-brand products when they go grocery shopping. You might even see them scanning the racks of the local thrift store for gently worn designer duds and used but still pristine furniture and home décor.

Take the long view

Building wealth will be a slow and steady process unless you are the one in several million who buys that winning lottery ticket. If you want to succeed, it pays to adopt the long view, saving consistently, taking calculated risks, and tracking your progress over time.

Conduct an annual financial review

Successful wealth builders know where they stand and where they are going. So they conduct annual reviews of their finances, including emergency savings, investments, insurance, and all other expenses.

 

Building wealth is not an easy process; in many cases, it is not fast either. If you want to build wealth for the long term, start today, and adopt these smart habits that can help you succeed. The strategies listed above can help you get started, one dollar, and one day, at a time.

 

This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA.

Article Credit: BALANCE

A lemonade stand is pictured to represent seasonal income.

Making the Money Work When Your Income is Seasonal

posted on

June 1, 2025

Flexibility, built-in vacation time, freedom—seasonal work has many natural benefits. But it also comes with its own challenges, especially in making its financial side work for you. Most of the available financial advice assumes a steady income stream each month. But that doesn’t help much if you have to plan for extended periods without a lot of cash rolling in.

 

Use these pointers to make sure your money situation is what you need it to be, no matter the season.

Take advantage of all incentives

With labor shortages common in the US, many employers offer several incentives – from retention bonuses to transportation reimbursement and beyond – so weigh your options and go with the employer offering you the best total package. Keep track of all offers mentioned to make you get everything coming to you.

Know your monthly expenses

This can’t be overstated: the biggest key to successful money management with seasonal work is understanding your baseline monthly expenses. Knowing what you need to survive and have a decent quality of life throughout the year ensures you don’t encounter too many anxious moments when money is tight. Once you know your basic monthly expenses, you can start calculating how much you’ll need each month during your off time.

Do the calculations

Multiply your monthly baseline expenses by the number of months you don’t plan on having income (or much income) over the coming year. Once you have that number, divide it by the number of months you will be working. Now, you know how much you need to save as a bare minimum total during your work stretch.

Utilize multiple savings accounts

In addition to being a time of earning, your heavy work months should also be a time of saving aggressively. To keep all your savings goals straight, set up accounts to stash money for your upcoming monthly expenses and anything else approaching the horizon. That could include vacations, tax obligations, home repairs, or other outlays of cash.

Do a new budget with each transition

On top of diminished income, your life during the times when work isn’t plentiful may have other differences when it comes to expenses. Taking the time to do a new budget each time you transition into and out of your busy work times will help you keep your spending in a place that keeps you safe and secure.

Prioritize emergency savings

With variable income, you’re even more susceptible to the negative effects of a sudden, unexpected expense. Even if you’ve covered all your core expenses, you’re not assured of a smooth transition time until your next larger gig. Without a steady income stream, a big surprise can lead to a big crisis. You may not be able to save enough to cover every emergency right away. Still, putting money away is a good idea to ensure less turbulence when that inevitable curveball comes.

Stay wary of credit card usage

If unforeseen events arise and you find yourself looking to a credit card to cover your necessities, understand that this should be a wakeup call that your finances are in a precarious position. Mounting credit card debt, especially for someone with inconsistent income levels, is not sustainable and should be treated as a sign that significant changes need to be made to your overall financial plan.

Be conscious of stress-related expenses

When you’re in the thick of a busy work season, you’re probably looking to work as many hours as possible. When you have a little time off during this hectic stretch, you might be looking to make the most of your leisure time to blow off some steam. Whether it’s lavish food and drink, a retail therapy session, or another type of splurge, these big spender moments might feel good at the time, but they can be costly to your overall financial wellness in the months ahead. Try to plan some low-cost activities ahead of time for your relaxing hours, so you’re not as tempted to go hog wild.

Time your more considerable expenses carefully

If you’re like many seasonal workers, you may keep yourself motivated during the tougher moments by thoughts of treating yourself once working days are put on hold for a while. It could be a nice trip somewhere or a lovely little gift to yourself. It’s wise, though, to hold off on treat until you’ve done a full assessment of where your money’s at before making a big purchase. You don’t want to start your leisure time by creating a more tenuous financial situation for the months ahead.

Avoid check-cashing businesses

If you get paid with a check for your seasonal work and rely on a check-cashing business to get at your hard-earned money, please reconsider your options. Having a checking and savings account with a local credit union, or bank will help you keep more of that money you put so much effort into earning.

Take advantage of available assistance

Contact your state’s unemployment office to determine if you might be eligible for unemployment benefits during the period in which you’re not employed. Additionally, you may also qualify for help through the Temporary Assistance for Needy Families (TANF) program. For other programs that might be available in your area, dial 211.

Don’t neglect your retirement

Many employers make retirement savings easy with a set-it-and-forget-it plan like a 401(k). Saving for your golden years may be a bit more complicated if you plan on continuing with seasonal work. However, remember that an Individual Retirement Account (IRA) and other options are available. Take advantage of the opportunity to put the power of time to work for you.

 

This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA.

Article Credit: BALANCE

An image illustrating preparing and planning financially for college - a stack of coins supports a graduation cap in front of books and eyeglasses.

College Planning 101: 5 Tips from BALANCE

posted on

May 15, 2025

College Planning 101 

Most parents have already heard the bad news: a college education has never been more expensive. Many, in fact, are still paying off their own student debt and would like their children to avoid that burden. The good news is that there’s a lot parents can do to help their children and make the costs of college more manageable.

Invest in a Tax-Advantaged 529 Account

The 529 account is an education savings account and it’s a fantastic deal to save for education expenses for a child, grandchild, or even yourself. Though contributions to 529s are not tax deductible, the account’s earnings are not taxed when you use the money for qualified education expenses – things like tuition, books and even room and board. Start automatic deposits from your paycheck when your child is young and you could have a substantial nest egg when she’s ready for college.

Apply for Financial Aid

You have to be poor to receive financial aid for college, right? Wrong! While many scholarships and grants are needs-based, many other financial aid opportunities are merit-based. So, if your child does well academically, or meets other specialized criteria, she may qualify for assistance even if you are affluent. For example, many colleges and universities have endowments and use this “institutional aid” to attract promising students – and not just athletes – to their programs. 

 

When exploring your options, keep an eye out for scammers. While there are reputable college financial planners, no legitimate scholarship program will require students to pay to apply for aid. And, of course, be wary of any college funding strategy or investment that sounds good to be true!

Explore Local Community Colleges

Academically-speaking, community colleges offer a phenomenal value for meeting almost any degree program’s general education requirements. Plus, students at community colleges often benefit from close teacher-to-student ratios, while many university and four-year college GE classes aren’t even taught by full-time faculty. There are also huge savings on room and board when a child attends a local institution and can continue living with mom and dad. Just remember to investigate requirements for transfer students to ensure that preparatory coursework will be accepted by the student’s chosen degree program.

Borrow Sensibly

Even with financial aid and parental support, many students will still need to take out loans to pay for college. The key is to limit borrowing to an amount the student can reasonably be expected to pay back in ten years or less. The lower the loan amount, the better, but a good rule of thumb is to borrow no more than the expected first year’s salary.

Let Your Child Have Skin in the Game

If the money’s there to pay all of your child’s college expenses, it’s all good. However, parents who skimp on critical goals — like saving for their own retirement – to pay for a child’s education, may never recover from the financial hit. Remember, your child can pay for college with a combination of student loans and work earnings, but you can’t get a “retirement” loan to pay expenses when you’re no longer working! 

 


This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA.

Article Credit: BALANCE 

An image illustrating building financial security for retirement - two wooden figurines representing an older couple stand next to a piggy bank.

10 Tips for Financial Security After You Retire

posted on

May 1, 2025

Not that long ago, people looked forward to retirement as a time of relaxation and leisure when one might travel the world or take up a new hobby. Increasingly, however, people preparing to retire are doing the math and realizing that the future doesn’t look so bright financially.

 

The following 10 guidelines will help you enjoy a more comfortable retirement even in an uncertain economy.

1. Have a Plan But Stay Flexible

Retiring successfully takes planning. Take an honest inventory of your assets, savings, investments, and set some goals for your retirement. Consider what you’d like to be doing, where you’d like to live, who you want to be near, and what kind of lifestyle you prefer.

 

While you need a plan you also need to be flexible and open to unexpected changes. Keep yourself informed about the latest developments in areas such as the cost of living, tax laws, investments, real estate trends, and other areas that are likely to have an impact on your life.

2. Watch Your Spending

Overspending is a common mistake for many retirees. The paradox about not working is that you have less money coming in but more time to spend your money. It’s natural to want to fill up all your free time with eating out, shopping, traveling, and other leisurely pursuits. It’s important to set a budget and stick to it. You don’t have to cut out all entertainment and treats. However, make sure you don’t spend beyond your means.

3. Find New Sources of Income

It’s an unfortunate fact that people in the United States and many other countries are postponing retirement because they can’t afford to stop working. Some employees, meanwhile, are forced into retirement. There are, however, alternatives besides working full-time and complete retirement. Here are a few possibilities.

 

Get a part-time job. This can actually be good to keep you active as well earning money.

 

Start a business. There are many businesses you can start from home, from selling items on Amazon or eBay to providing freelance services.

 

Make money from your property. If you have extra space, you might rent out a room or set up an Airbnb.

4. Get Out of Debt

Reducing or eliminating debt is one of the best ways to improve your financial situation. Debts are especially draining after you retire. Do whatever you can to cut down on what you owe, especially high-interest debts such as credit cards.

 

Paying off debt provides two main benefits. On the one hand, it reduces the burden of making high payments when your income may be decreasing. Additionally, you have a chance to improve your credit score which is useful if you want to apply for a mortgage, business loan, or another type of loan in the future.

5. Don’t Touch Your Retirement Account Early

Withdrawing money from your retirement account early may be tempting but it’s seldom a financially wise decision. You also incur tax penalties if you take money out of an IRA or 401K before retirement age (currently 59.5). If you’re thinking about raiding your retirement account, make this an absolute last resort. You’ll be glad you held out a few years from now.

6. Downsize Your Lifestyle

For most people, mortgage, rent, utilities, and other home-related costs are their costliest expenses. Consider how much space you need and whether it might be practical to downsize. If you have your own home, you could sell it and buy a smaller one or relocate to an area with a lower cost of living. Renting or moving to a condo helps you cut down on home maintenance costs. An extreme way to reduce your cost of living is to retire to a country with very cheap living expenses such as Ecuador or Panama.

 

There are other ways to downsize and simplify your lifestyle aside from housing. Consider moving to a location where you don’t need a car. With ride-sharing services and short-term rental options, more people are finding that owning a vehicle is an unnecessary expense.

7. Take Care of Your Health

Medical expenses are one of the biggest reasons people fall into financial difficulties later in life. Aside from getting regular checkups, pay attention to your habits and lifestyle. If you smoke, drink heavily, use drugs, or don’t exercise, consider transforming your lifestyle.

 

Bad habits tend to catch up with you when you can least afford it. Eating a healthier diet, exercising regularly, and avoiding harmful substances will cause you to feel better while also saving you money on health care costs. You can also manage health expenses by researching the most advantageous health insurance options.

8. Invest Wisely

It’s never too late to start investing or to improve your investing strategy. As a general rule, you should invest more conservatively as you approach retirement.

 

Diversifying your holdings is the best strategy. Spreading investments between small and large-cap stocks, bonds, mutual funds, and real estate trusts increases your chances of reaping steady returns. An annuity can provide you with predictable payouts after you retire. If you need help, consult with a CPA or investment counselor.

 

The other side of the coin is to be wary of dubious investments. Older people are often targeted by scam artists selling fraudulent “investments.” Even legitimate investments that are highly speculative such as futures, Forex, cryptocurrency, and others carry significant risks. Make sure the bulk of your holdings are in more stable assets before you start speculating.

9. Don’t Be Overly Generous

Many older adults are victims of their own generosity. As younger people face rising housing and education costs, they sometimes turn to their parents and grandparents for help. While it’s great to help your kids buy a home or pay for your grandchildren’s college tuition, make sure you don’t overextend yourself. Before you give away large sums, look into the future and ask yourself how this will impact you 5 or 10 years from now. Sometimes you just have to say “no” even if it’s painful.

10. Take Advantage of Senior Discounts

There are many financial advantages to being a senior (though the exact definition differs depending on the situation; it may be 55, 60, 62, or 65). If you’re not a member of AARP, join now and learn about more benefits. Your local public library is also another good place to learn about programs. Before spending money on anything, from healthcare to travel to transportation, find out if you can get a discount based on your age.

 

These are some ways to help you manage your finances when you retire and even before. It’s important to look at your situation and devise a workable strategy. People get into trouble when they live day-to-day and ignore impending problems.

 


This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. Membership required. SRP is federally insured by NCUA.

Article credit: BALANCE

A collage graphic showing the following: Top left: SRP Federal Credit Union Community Development team members Michael Clennett, Charmaine Finch, and Grace Helms stand behind a table featuring SRP folders, pens, and other items. Right: Community Development team member Yvonne Meeks leads a game of financial jeopardy at USC Aiken. Bottom left: A view of the game board for Financial Jeopardy by SRP Federal Credit Union.

SRP Federal Credit Union Hosts Financial Education Event at USC Aiken

posted on

April 22, 2025

Aiken, SC – On April 2, SRP Federal Credit Union hosted Pace Your Finances, a financial education event for college students at the University of South Carolina Aiken.

 

Led by SRP’s Community Development Department, the event featured a Jeopardy!-style trivia game focused on credit. Students competed for prizes while learning about essential financial topics such as credit scores, loans, and more.

 

The event reflects SRP’s continued commitment to promoting financial literacy at the university level. In 2024, SRP and the USC Aiken School of Business Administration launched Pacer $mart, a financial education initiative designed to serve both college and high school students.

 

Developed to equip students with the tools they need for long-term financial success, the Pacer $mart program offers a comprehensive personal finance curriculum that encourages informed decision-making. In March, representatives from SRP and USC Aiken unveiled a co-branded classroom and hallway dedicated to the program.

 

Rooted in the credit union philosophy of “People Helping People,” SRP Federal Credit Union continues to invest in financial education across the communities it serves. In addition to Pacer $mart, SRP offers a variety of educational resources, including seminars, counseling, school visits, and more.

 

About SRP

SRP Federal Credit Union, headquartered in North Augusta, SC, provides financial services to over 196,000 members. Recognized for excellence in business and community impact, SRP was recently named the 2024 Large Business of the Year by the Columbia County Chamber of Commerce and the North Augusta Chamber of Commerce. For more information, visit www.srpfcu.org.

"Three Reasons You Should Always Pay More Than The Minimum" next to a hand using a mock credit card on a card reader.

Three Reasons Why You Should Always Pay More Than the Minimum

posted on

April 15, 2025

Credit cards are a valuable financial tool for both individuals and businesses–but they come at a price. 

 

You get purchasing power on the spot, and the creditor only requires you to pay off a small amount of the total every month, i.e., the minimum amount due. However, it’s important to remember that the minimum is calculated in the best interest of the creditor, which puts you at a disadvantage. 

 

Here are some important reasons why you should always pay more than the minimum due on your credit card. 

 

1) Save money 

When you only cover the minimum every month, you end up paying more in interest. The minimum payment exists to ensure that interest fees are covered, with only a small amount going toward the actual balance. 

 

For example, suppose you have a $3,000 balance with a 14 percent APR (Annual Percentage Rate). Your minimum payment would be around $65. By the time you pay it off, you will have paid an additional $1,332 in interest. 

On the other hand, if you were to pay $100 every month instead of $65, you would only pay $713 in interest. 

 

2) Get to debt-free faster 

The more you pay, the quicker you’ll be debt-free. Using the same example, it would take 67 months to pay off the original $3,000 balance, along with all that extra interest. That’s 5.5 years! 

 

Paying $100 per month instead would clear the debt out in approximately 38 months, which is just over three years. Of course, this is provided you’re not adding additional charges to the card and that your APR remains at 14 percent. 

 

3) Raise your credit score

The ratio of your balances to your credit limits is called “credit utilization.” This ratio actually accounts for 30 percent of your entire credit score. 

 

For example, a credit limit of $2,000 with a balance of $500 would mean that you have a credit utilization of 25 percent. A lower ratio is better because it shows that you’re using only a small amount of the total credit that has been extended to you. 

 

If you’re only paying the minimum, your balance remains high relative to your total credit limit. This will cost you some points on your score. Naturally, this also means that when you begin making higher payments that quickly bring down your balance, you’ll likely see an increase in your credit score to reflect this change. 

 

So what’s the solution to avoiding the minimum payment trap? Whenever possible, pay off your balances in full every month. 

 

APR = Annual Percentage Rate. This article is for informational purposes only and is not intended to provide tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for advice. All loans subject to approval and rate may vary depending on individual's credit history and other factors. All Credit Union loan programs, rates, terms and conditions are subject to change at any time without notice. Membership required. SRP is federally insured by NCUA. 

Article Credit: BALANCE

"Three Mortgages Every Home Buyer Should Know" above the SRP logo and next to a key with a house-shaped keychain inside the door lock. Image for an article describing the different types of mortgages available.

Three Mortgages Every Home Buyer Should Know

posted on

April 1, 2025

Because of the high cost of most real estate, very few people can purchase a home with savings alone.

 

Therefore, if you are like the vast majority of people, you will be borrowing money from a financial institution to purchase the property you want. Called mortgages, these loan products can be quite complicated. Knowing the basics of how mortgages work can help guide you to the loan that is most appropriate for you. 

 

Mortgage Terms 

How long is it going to take you to repay the loan? That depends on the term of your mortgage. A term is the number of years that you agree to pay back the amount you borrow. 

 

The term also affects the cost of your mortgage payments. Shorter repayment periods mean higher monthly payments but less interest you pay over the life of the loan, while longer terms will give you lower payments but will cost more over the long run. The traditional mortgage term is 30 years, but they have ranged from ten to 40 years. 

 

Types of Mortgages 

There are several types of mortgages available, with the most common being fixed-rate, adjustable, and interest-only. 

 

Fixed-rate mortgages come with an interest rate that remains constant over the life of the loan. 30-year mortgages are the most common, but you may also choose a 20-year, 15-year, and even 10-year fixed-rate mortgage. In certain high-cost areas some mortgage lenders were even offering 40 year-loans. Though the mortgage interest rates tend to be higher than for other loan types, the rate is fixed and your payment won’t change. This stability makes them the most secure type of mortgage for buyers. 

 

Adjustable-rate mortgages (ARMs) have a period of fixed interest, but after that the payment changes with whatever index the loan is based on. The period of fixed interest may be three, five, or seven years. With a 5/1 (the first number stands for the number of years in the initial fixed period, while the second indicates how often the new rate will adjust) ARM, for example, the initial interest rate remains fixed for the first five years, and then adjusts annually for the remaining term. 

 

There are several types of caps that may apply to an ARM: an overall cap limits how much the interest rate can increase over the life of the loan; a periodic cap limits the amount the interest can increase from one period of adjustment to the next; and a payment cap limits the amount the monthly payment can increase at each adjustment. 

 

While ARMs are less secure than fixed-rate mortgages, they tend to have lower initial rates and therefore lower monthly payments. They can be a good option if money is tight in the early years, as long as you are confident you can meet future interest and payment increases. 

 

Interest-only mortgages are loans that allow you to pay just interest for between three and ten years. Once that period is over, the payment rises to include both principal and interest. While qualification can be easier and the monthly costs can be lower than other mortgage types, they can be a gamble. A downturn in housing prices could mean that you end up owing more than you own, and an interest rate hike could put the payments beyond your reach. 

 

Certainly there are benefits and drawbacks to each mortgage type. Long before you borrow, consider each option carefully to know which is most appropriate for your situation. With so much money at stake, making the best mortgage decision is important. 

 

This article is for informational purposes only. All loans subject to approval. Actual rate and terms may vary depending on individual’s credit history and other factors. Membership required. SRP is federally insured by NCUA. Equal Housing Lender. NMLS ID #612441.

Article Credit: BALANCE

Representatives of USCA and SRP Federal Credit Union prepare to cut the ribbon on the newly designed Pacer $mart hallway and classroom.

USCA and SRP Federal Credit Union Unveil New Pacer $mart Classroom

posted on

March 27, 2025

Aiken, SC – Representatives from SRP Federal Credit Union and the University of South Carolina Aiken gathered on March 21 to celebrate the unveiling of a newly designed classroom and hallway dedicated to financial education at the university.

 

The new learning space will host Pacer $mart, a financial education program created in partnership between SRP and USCA’s School of Business Administration. Designed to equip college and high school students with financial knowledge, the program covers key personal finance topics, including budgeting, saving, credit, investing, insurance, taxes, and economics.

 

“The Pacer $mart program is a testament to the power of partnership in shaping students’ financial futures,” said Dr. Daniel J. Heimmermann, Chancellor at USCA. “This newly designed space will serve as a dynamic hub for financial learning, equipping students with the knowledge and confidence to make informed financial decisions throughout their lives.”

 

Located inside USCA’s Business & Education building, the newly branded Pacer $mart classroom will serve as a hub for guest speakers, financial success camps, and other educational initiatives. The classroom and adjoining hallway feature wall murals that incorporate university and SRP branding, along with an inspiring quote from Benjamin Franklin: “An investment in knowledge pays the best interest.”

 

SRP Federal Credit Union remains dedicated to the credit union philosophy of “People Helping People” by fostering financial education in the communities it serves. In addition to the Pacer $mart program, SRP provides personal financial education through seminars, financial counseling, school visits, and more.

 

“Uplifting our communities through financial education is a cornerstone of our mission at SRP,” said Liz Ponder, Interim CEO, SRP Federal Credit Union. “We are proud to partner with USC Aiken to empower students with the knowledge and skills they need for lifelong financial success.”

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