by Pam Reiss
Believe it or not, many people get through life without understanding the basic principles of banking. They make their deposits on payday and make withdrawals to pay the bills, and as long as the balance is in the black their finances aren’t given a second thought. But to know the “what” of banking is only half the story—understanding the “why” is equally important. By educating yourself on why certain elements of banking happen the way they do, you can become better equipped to manage your assets responsibly.
Even some of the most basic banking principles, like balancing a checkbook, have gone by the wayside—especially with the growth of online banking. Would you believe that 69 percent of people never balance their checkbook?
So let’s get back to basics and cover a few of the fundamentals of banking that you should understand about your hard earned savings.
Why do you need to balance your checkbook?
While the practice of balancing a checkbook is commonly viewed as a lost practice these days, in fact it is more important than ever. Even though there are strict procedures in place within financial institutions to protect your assets at all times, cases of identity theft and cyberattacks continue to rise. If this happened to you and you haven’t reconciled your account, you might not catch the crime until more damage has been done.
Why are there temporary holds on check deposits?
When you make a checking deposit, a portion of those funds become immediately available for use. But a temporary hold is placed on the remainder. This is important to know so that you can avoid bouncing checks with money that has yet to be transferred to your account. Don’t take it personally, though—the reasoning has nothing to do with your bank’s impression of you. In fact, your bank is simply waiting for the funds to be transferred from the payer’s bank, which can take up to several days. Your financial institution is simply making sure those funds arrive as planned.
Why pay off your whole credit card balance instead of the monthly minimum?
When you’re struggling to make ends meet, the monthly minimum payment option offered by credit card companies might seem enticing. But paying off the bare minimum has a far-reaching impact. Credit scores, for instance, are calculated largely based on the amount of debt that you carry. You also may end up owing more in the long run, as your interest rates could end up creating more debt than you’re paying off each month.
Even if you can’t pay the whole balance in full, making a payment a little above the minimum will help you avoid letting your debt spiral and will demonstrate to your card issuer that you are a responsible customer, giving you more bargaining power in the future when you look to increase your credit line or take out a loan.
For more basic banking principles, stop by a Milford Bank branch location near you or check out our Learning Center online by clicking here.
by Mark Attanasio
Summer is the perfect time to plan a getaway. You don’t need to worry about snow holding up your travel plans, or missing days of school. And the weather is ideal for all sorts of outdoor activities.
But if you are finding it tough to get away for a week-long destination vacation, there are still plenty of ways you can take full advantage of all the summer has to offer. A staycation—a vacation during which you stay close to home—is a great alternative, whether you’re tied up at the office or you don’t have a bigger trip in your budget.
The good news is there are tons of nearby, affordable destinations that you and your family can enjoy for the day or a week. Here are five places you can go to have an unforgettable staycation this summer.
- Camp out at Hammonasset Beach State Park: You may know Hammonasset for the swimming, but did you know there are also hundreds of camping spots, ranging from cabins to tent sites, located Madison State Park? Enjoy an Oceanside sunset or hike along miles of beautiful Connecticut shoreline. A nightly lot reservation costs as little as $20, making it a very affordable option.
- Double up with a daytrip to Mystic: Head up 95 North into Mystic and you’ll find two of the state’s unforgettable destinations: Mystic Seaport and the Mystic Aquarium. Located just minutes apart, you can see both in one day if you’re limited for time. At the seaport, you’ll be transported back into the 1800s as you tour the village and old sailing vessels. At the aquarium, you’ll have a chance to see all the unique creatures under the water.
- Travel back in time at the Peabody Museum of Natural History: Located at beautiful Yale University in New Haven, the Peabody is the only place you can find mummies and dinosaurs together in the state. Admission prices range from $6 to $18, which means you’ll still have some extra cash left over to head down to Wooster Street later for a pizza.
- Get your thrills at Lake Compounce: For the thrill-seeker, check out Lake Compounce in Bristol. Some argue that it is the oldest operating theme park in the country. Regular admission starts at $42, but there are a number of summer-long deals available so keep your eyes peeled. Lake Compounce also hosts events and concerts, so if you’re not a roller coaster enthusiast there are still plenty of fun things to do.
- Take a romantic trip along the CT Wine Trail: Connecticut may not have the recognition of Napa Valley, but believe it or not there are 25 wineries and vineyards throughout the state that make up the Connecticut Wine Trail. If you’re looking for a romantic date idea, ditch the highway traffic and drive along the state’s country roads, taking in the sights as you make your way from stop to stop. There are plenty of local inns along the way should you need them.
A fun-filled summer doesn’t have to cost an arm and a leg. There is so much to see in Connecticut that it might even take a few staycations to see everything. To find out more about how you can improve your quality of life without sacrificing your savings, check out our website for more tips, or stop by any of our office locations.
by Lynn Viesti Berube
If you’ve stopped by one of our office locations and spoken with one of our experienced and friendly employees, you already know about the superior financial services The Milford Bank can provide to help you make the most out of your money. But did you know that there are a variety of resources located on our website for your convenience as well?
In the interest of helping you get the best education possible, we’ve filled our website with financial resources that you can access conveniently anywhere you go. From programs to teach your children about savings, guides to teach you about saving for retirement and everything in between, your Milford Bank experience isn’t complete without checking out all our website has to offer.
In case you’ve missed them, here are some of the hidden treasures placed on our website to help you and your family make smart financial decisions.
Cent$ible Kid$: Teaching your children about the value of saving money can be difficult. That’s why we created the Cent$ible Kid$ program. Your kids can learn how to manage and reinvest their savings with three interactive games right on our site. The program also comes complete with a child-friendly quarterly newsletter full of advice for your kids. As a Cent$ible Kid$ program member, you and your children will also qualify for incentives and special offers from Milford Bank. You can check out the Cent$ible Kid$ program here.
Learning Center: If you’ve got a financial question you need answered but it’s after hours, head to the learning center. You can find answers to your questions easily, whether it’s as simple as explaining how savings bonds work or as complex as planning your estate. There are a dozen unique sections in the learning center that cover a wide variety of topics, each complete with its own downloadable guide. You can reach the Learning Center by clicking here.
Financial Calculators: Are you curious about buying a house and want to quickly figure out the price difference between a 15 and 30 year mortgage? Are you trying to determine whether or not to consolidate your debt? Do you want to know how long it would take you to become a millionaire with your current saving strategy? You can use our financial calculators to get a quick answer to these questions and many more by simply clicking here. Using financial calculators can help provide context to the financial decisions in your life that seem too large to wrap your head around and give you a clear directive on how best to proceed.
At The Milford Bank we want you to have an unforgettable and informative experience with us, whether you’re depositing a check with one of our tellers or skimming over our website on a mobile device from the comfort of home. That’s why we’ve populated our website with these features. But there are even more hidden treasures than those mentioned above. Check out our page here and see what else you can find!
By Janet Harrison
Here at The Milford Bank, we don’t think of ourselves as just your local financial institution. We don’t think of ourselves as simply bank employees either. The Milford Bank team is a family. We’re staffed by hard-working people just like you with a dedication to being active members of the community, both individually and collectively.
We believe in the value of having a strong community and know that creating such a climate is made much easier by building lasting relationships. That’s why we don’t stop building relationships outside of the bank lobby—we work hand in hand with many local charities and non-profits that share in our vision for the Milford area.
Here are a few of the organizations we’re currently working with to build a healthy and prosperous community. Read on to see what they’re all about and what you can find going on in the Milford area over the next few months.
Boys and Girls Club: The Boys and Girls Club has autonomous chapters across the country dedicated to providing boys and girls of all ages a safe facility to learn reach their full potential through programs ranging from athletics, arts, life and career skills. The Milford chapter has summer offerings as well as afterschool programs that will start up in the fall. On August 7, the group will be fundraising with the always exciting annual Walnut Beach Ice Cream Run. You can click here to learn more, register or become a sponsor.
United Way: As one of the largest charitable organizations in the world, United Way has taken up the task of strengthening communities by performing a wide variety of good deeds from building classrooms in the Philippines to providing job training right here at home. United Way of Milford gets involved hosts many local events, but perhaps their largest event of the year will take place September 16—the United Way of Milford’s 15th annual golf tournament, scheduled to take place this year at the Woodbridge Country Club. For registration or contact info, you can contact firstname.lastname@example.org or call (203) 874-6791.
Sterling House: Built in 1886, the Sterling House has in subsequent years been transformed into a living reminder of our rich local history that now fulfills the role of a community center. Serving over 13,000 local residents each year with affordable social, educational and recreational activities, Sterling House is a vital asset in fostering a positive and healthy community. Stop by on July 23 or August 20 to enjoy open swimming, crafts, music, food and fun for the whole family, or wait for the Sterling Down and Dirty 5K taking place September 10 at Short Beach in Stratford. All proceeds will help support the Sterling House’s community projects.
Be sure to check back in for the next installment of Community Roundup to learn what our other partners around town are up to over the next few months. Also follow Milford Bank on Facebook and Twitter to see more exciting events. You can reach out by checking out our website here.
by Patty Gallagher
Even if you love your job, you’re probably looking forward to the day you punch your last time card and can begin your retirement. But while you may have a 401K and social security coming your way, the bulk of your retirement stash may still fall on you and your ability to save.
With that said, when should you start saving for retirement?
It is never too soon.
Relying solely on a 401K or social security can be a risky bet. Your 401K is tied to the success of the stock market. Even if your 401K performs well for 30 years, a sudden economic downturn could erase your earnings just when you need them.
Social security, too, is growing increasingly uncertain. According to 2015 findings from the Social Security Administration (SSA), the ratio of workers to SSA beneficiaries is currently at a record low of 2.8. (By comparison, when social security was first rolled out, there were 41 workers supporting the program for every social security recipient.) As the baby boomer generation ages that number is anticipated to continue shrinking, raising questions about the long-term viability of the program as it currently exists.
Both of these pillars of retirement planning can be highly unpredictable. That’s why it is so important to begin planning your retirement savings early.
To ensure a long and happy retirement, here are the two easiest and most impactful things you can do:
Change your spending habits: Increasing your savings for retirement isn’t just about earning as much as you can during your working career. Making slight lifestyle adjustments to alter how you spend that money can have just as large an impact. What is that five-dollar specialty Starbucks drink you get every day worth to you? Over the course of a 40-year work history, it would add up to $73,000—more than enough for a down payment to help you move into a relaxing, beachfront condo.
Diversify your investments: While your 401K can be viewed as a risky investment, it is still a safe harbor for your savings as long as you have other types of investments for balance. Certificates of deposit, savings bonds, annuities and IRAs are other financial tools that can provide safekeeping for your savings. Or, if you’re handy enough to take care of your own repairs, real estate can also be a good place for your money. In an economic downturn, gold and silver prices typically do well by comparison, so having a small supply of precious metals might provide an additional safety net.
To learn more about how you can prepare for a prosperous retirement, stop by any office of The Milford Bank and speak with a financial expert.
by Pam Reiss
According to the latest available statistics from the Administration on Aging, the number of senior citizens in America represented about 14.5 percent of the population. But that number is on the rise. The AoA expects that by 2040, seniors will make up nearly 22 percent—and by 2060 that number skyrockets to nearly 30 percent.
Unfortunately, the growing number of seniors in the community means that individuals looking for a mark for financial exploitation will have an easier time than ever. Seniors are targets for a number of reasons:
- They’re likely sitting on more money in retirement than many younger people.
- Some seniors have few friends or family members around and will suspend suspicion in favor of having company.
- Some leave the responsibility of managing their finances to younger family members that feel entitled to money they expect to inherit.
- Seniors in assisted living communities are surrounded by workers that may not have their best interests at heart.
- Health issues associated with aging, such as dementia, make abuse easier to get away with.
- Elders’ unfamiliarity with new technologies makes gaining access to personal financial data simpler.
All of these factors have converged on a growing elderly population to form a proverbial perfect storm for elder abuse. Just how rampant is the threat? According to the National Center on Elder Abuse, about 10 percent of seniors have fallen victim to financial exploitation.
Unfortunately, that means there is a great likelihood that someone you love may have been affected. Considering that these members of society are already on a fixed income in most cases, these abuses are considerably more heinous. The impact can range from inability to afford medications and housing to losses for family members that may have been expecting financial assistance themselves.
So what can you do to make sure this doesn’t happen to one of your loved ones? Take advantage of legal tools to limit the number of individuals that have access to, or control over, the finances of your aging family or friends. Use advance directives, living wills and limited powers of attorney for health care and financial decisions.
Awareness and education are also critical. Be sure that your aging loved ones are aware of the perils that exist in the world today. Be sure they understand that they should never provide sensitive personal information over the phone or online. If there is ever any question, be sure to speak directly to a representative from the institution in question, be it a bank, credit card company, or even something as seemingly benign as a telemarketing cold-call.
To learn more about how you can help to protect your loved ones against elder abuse, stop by The Milford Bank. Our financial experts will treat you as if you were one of our own family members.
by Mark Attanasio
Many people look to celebrities as an embodiment of the American Dream. Whether it’s an athlete inking a $100 million contract, a musician reaping the rewards of a platinum album or an actor raking in gold from an appearance on the silver screen, the rest of us see these individuals as the lucky ones that hit it big.
While it might seem like they’ll never have to worry about money again, the truth is that many celebrities end up in the same dire financial straits as the rest of us. Financial success isn’t only about how much money you’re bringing in, but rather how well you manage your assets, control your spending and avoid risky and potentially costly life choices.
Here are several high-profile names and their stories to serve as a reminder of the fact that financial success has less to do with your paycheck than you might think.
Nicolas Cage: Between 1996 and 2011, Cage banked over $150 million from his prolific acting career. He proceeded to spend it all on a lavish lifestyle revolving around sports cars, exotic pets, a rare collection of dinosaur fossils and private islands in the Caribbean. By the time the IRS came calling for its share—$13 million—the money was gone.
Reality check: It doesn’t matter how much you earn if you don’t put any money away for a rainy day.
Fred and Jeff Wilpon: The Wilpon brothers, majority owners of the New York Mets baseball team, became protagonists in a financial cautionary tale in 2008 when news broke that their fortune was ensnared in the ponzi scheme orchestrated by investment advisor Bernie Madoff. The Madoff case was discovered to be the largest financial fraud case in U.S. history and cost the Wilpon family between $500-700 million. They nearly had to sell their beloved franchise, but were eventually able to deal with their reversal of fortune.
Reality check: Even if you have entrusted the management of your finances to a professional, stay involved and know how your funds are being handled. Nobody, not even an advisor, will be more concerned about your bottom line than you are.
Willie Nelson: This legendary country music singer is perhaps as famous for his run-ins with the law as he is for his boisterous stage presence. Despite his commercial success, Nelson ran into tough times over the course of his career thanks to unpaid tax bills and a series of drug-related offenses that have cost him mightily over the years.
Reality check: Crime doesn’t pay. If you party like a rock star, you may end up broke as your life savings end up in the pockets of lawyers.
At The Milford Bank, our goal is to help you make the smart decisions with your money. Stop by any of our offices to learn more about protecting your wealth.
by Sindy Berkowitz
Imagine walking into a Porsche dealership and offering up an old cell phone as your payment. Not even just a down payment—the whole thing. You’d probably be laughed out the door. Finding someone willing to make such a lopsided deal might seem impossible, but believe it or not, one California teenager was actually able to accomplish the task.
Steven Ortiz, a 17-year-old from California, started out with an old cell phone given to him for free by a friend. After browsing the bartering page of Craigslist, he realized he could potentially turn trash into treasure.
Over the course of two years, Ortiz made 14 trades before ending up with a 2000 Porsche Boxster. He first traded for a better phone, then up to an iPod Touch. From there, he bartered his way to a dirt bike. After trading several dirt bikes, Ortiz found himself with a MacBook Pro. With a brand new laptop, the ingenious teenager was able to upgrade to a Toyota 4Runner and promptly swap the vehicle for a customized golf cart. After a series of trades involving dirt bikes, street bikes and beat up old cars, Ortiz found himself with a 1975 Ford Bronco. From there, Ortiz was able to trade for the Porsche.
Not a bad investment, considering that he started out with a free cell phone.
But besides being an interesting story, there’s a lesson here. How often have you simply given or thrown away something without giving it a second thought? With a little patience, careful research and a willingness to negotiate, you can take Ortiz’s example and turn some of the unused items in your home into something valuable.
There’s also another lesson here: Sites like Craigslist, Ebay and Amazon can be bountiful for individuals willing to get creative and apply a little elbow grease. In another highly publicized example from 2008, a man in Canada was able to work his way from being the owner of a single paperclip to becoming a homeowner in Saskatchewan, a province of Canada.
Even without relying on the bartering section of the site, such sites offer plenty of other ways to earn extra income. Buying used furniture and restoring it to increase its value is one such way. There are even websites with free items that simply require your time and energy to pick up. Anything sold would be pure profit!
The old adage that one man’s trash is another man’s treasure is alive and well in the digital economy. While it certainly wouldn’t be prudent to bet your retirement on bartering cell phones and paperclips, a world of opportunity exists to gain supplemental income from goods you may be ready to discard.
To hear about some of the more traditional means by which you can improve your financial outlook, stop by any office of The Milford Bank and talk to us about your goals.
by Becky Tudor
At The Milford Bank, we feel that our success is intertwined with the success of our community, which is why we strive to provide, and participate in, events that promote healthy living. That’s why we started the Milford Moves 5K race; it’s also why, this year, we’re taking it to the next level.
Last year’s turnout was spectacular, with more than 250 local residents showing up to race.
This year, Jorge Santiago, Milford Bank’s senior vice president, is hoping for an even greater turnout. In additional to supporting fitness initiatives, Jorge would like to raise as much as $10,000 for local veterans’ groups.
All profits from entry fees and event sponsors will be shared between four Veterans Service Organizations based in Milford: American Legion Post 196, VFW Post 7788, Chapter 15 of the Disabled American Veterans and Chapter 251 of the Vietnam Veterans of America. The primary missions of these groups are dedicated to veterans administration and rehabilitation, as well as mentoring and sponsorship of local youth programs.
Anyone, regardless of fitness level, is welcome to participate. Participants will receive an event T-shirt, a finisher photo free download and a “virtual goodie bag.” There will also be awards for the overall male and female winners, as well as awards in each age category. All participants under the age of 18 will receive participatory recognition.
If you’re not a runner, show your support and sponsor someone. With the help of generous sponsors, including the Police Benevolent Association, Napoli Deli and Milford Produce Market, we can reach our fundraising goal. Business sponsorships start at $250 and include free advertising. Individual sponsors can also chip in by supporting an individual runner.
If you participated in the race last year, you’ll appreciate that the route has been revised. This year’s runners will begin at Gulf Beach, make their way to the town green and then head back to the starting point.
To sign up for this year’s Milford Moves 5K, register online at Milford Bank’s website. Or, participants also have the option to register on June 12, the day of the race, from 6:30-7:30 a.m. The race begins at 8:00 a.m. But if you’re planning on waiting until the day of the event, be sure to leave extra time to take do some stretches before the race starts!
by Jorge Santiago
What do you think happens to the millions of dollars paid to today’s professional athletes? Do you assume that all of them have fat bank accounts? If so, you’d be wrong. Unfortunately, many of these heroes of the gridiron and diamond squander their earnings. In fact, 78 percent of former NFL stars go broke within two years of their retirement, and 60 percent of NBA stars also find themselves in financial ruin once their stars have faded, according to a historic 2009 Sports Illustrated article.
As the Sports Illustrated article reported, the main causes behind these massive financial losses include bad investments, excessive spending, divorce, and mismanagement of funds by trusted advisors.
But then there are the sports figures who manage to keep their accounts in the black, such as Shaquille O’Neal, Phillip Buchanon and Derek Jeter.
How do these athletes manage to accomplish what their peers have failed to do? For Shaquille O’Neal, it’s simply a matter of doing his homework before investing, appearing in movies and television programs, endorsing a variety of products, and maintaining his own fashion lines in major department stores such as Macy’s and J.C. Penny. Despite spending $1 million in less than an hour after signing his first professional contract, O’Neal’s ability to invest intelligently and stay out of major debt came from simply saving his money. As O’Neal himself advises, “Let’s just say you got $100, you break it in half—smart people put $50 away and don’t touch it. Now you still got $50 left. But the really smart people, the people that know that one day you’re never gonna play again, they save $75 …”
Former NFL star Phillip Buchanon learned his lesson about finances the hard way. After signing his contract, Buchanon’s mother demanded that he pay her $1 million for everything she’d done for him. Instead of giving her the money, Buchanon bought her a house, which ultimately caused him “financial strain.” In his book “New Money: Staying Rich,” Buchanon advises new millionaires to do the following:
- “Draw a line between wants and needs.” Setting limits is imperative to avoiding the common financial pitfalls, such as giving away money and buying family members expensive things.
- “Watch out for takers.” Similar to setting limits, Buchanon advises new professional athletes not to give money to people just because they think you have it to spare. Setting up boundaries is fundamental to ensuring that people don’t take advantage of you.
- Surround yourself with people you can trust. Differentiate between true pals and fair-weather friends, as the real ones will want to ensure your well-being.
Another example of an athlete who has secured his financial future is 20-years baseball veteran Derek Jeter. This Yankee utilized a method similar to O’Neal’s, using his personal brand to start a business. He partnered with Simon & Schuster to publish books, and become a brand development officer and partner at the company Luvo. Jeter’s publication and business, “The Players’ Tribute,” is a way for Jeter to combine his own interests and experiences while providing professional athletes with an outlet for the release of information about their own careers or personal lives. By diversifying his sources of income and creating a new publication that filled a gap in the reporting industry, Jeter was able to maintain his financial position following his retirement.
If it is starting to look like your professional sports career isn’t going to pan out, fear not—by taking the financial advice of these former athletes, you can still save money with the best of them. Be sure to stop by any office of The Milford Bank to get more advice about achieving your financial goals.