6 Entertainment Options That Won’t Break Your Budget

By Pam Reiss

As the saying goes, “a penny saved is a penny earned.”  You work hard for your paycheck but, if you’re like many of us, you’re amazed at how little you’re able to save every month.  Especially now, with the rate of inflation as high as it is, and many people still reeling from the past two years, finding ways to save even a little more is important.  It may be to save for a vacation or wedding, college tuition, a new car, or for a rainy day fund, or any other reason.

Entertainment is an important part of our lives.  It gives us a much needed and deserved break from the work week and other routines.  It also lets us enjoy our friends and family – many of whom we may not have seen recently.

So, the question becomes, how do we entertain ourselves without breaking our budgets?  Going out for dinner or happy hour, taking in a movie, or enjoying a concert are always fun activities, but you can easily run up a huge tab if you’re not careful.  That doesn’t mean you can’t have a good time without spending a pretty penny.  There are a wide range of activities you can enjoy with your friends and family, while keeping your finances in check and making the most of what you earn.

Here are a few cost-friendly entertainment options and tips to consider, so you can stay committed to your savings plan and still enjoy some quality down time.

Bring the party home

Meeting up with friends for a drink is a pretty common activity.  Why not save a few bucks and have happy hour at home?  There are several ways you can do this, which will make sure you enjoy that end-of-the-week stress relief with your friends, without a high bar or restaurant tab.  Consider having you friends over to enjoy drinks and snacks or dinner much more affordably.  To even out the food and beverage costs, try making it a recurring event and rotate it between each household.  Or, you can make it a BYOB and/or pot luck meal.  You can even split the cost and have friends reimburse you with a P2P payment app.  Just because you’re hosting doesn’t mean you have to bear the entire cost.

Skip the theater and rent a VOD movie

Everyone loves to check out a new movie once it hits theaters, but that can get expensive.  Ticket prices alone have gone up over the years, and adding popcorn, candy, and drinks into the mix can really add up – especially with fancier food and beverage options in many of today’s theaters.  Luckily, most major releases these days can be accessed via on-demand or on streaming services, so you can watch the same movie from the comfort of your home.  You may have to pay for some, but others are being released on streaming platforms as they come out in theaters.  Even if you have to pay for it, it’s typically not much more than the cost of one movie ticket.  But, you’ll also save on snacks, beverages, and parking.

Take advantage of admission promotions

Most areas have a great assortment of museums, art galleries, aquariums, zoos, and festivals throughout the year.  Yet, so many people don’t realize they have access to these locations or events for free or at reduced rates.  Even festivals that charge entry fees often provide an entire day’s worth of activity – often outdoors.  Consider checking out one of these options as an alternative to your usual entertainment lineup.  You may be able to find coupons or other savings through your local paper, social media, or other websites.  Sites like Groupon and others often have good deals on group activities.

Break out the board game collection

We’re always looking for existing activities outside of the house, yet fail to realize most of us have great options in our own closets.  How many board games have you accumulated over the years?  Why not dust them off and enjoy countless hours of fun with your friends or family?  Turn it into a weekly or bi-weekly event, and even have friends bring their games to add to the mix.  There are a wide variety of classic games and many newer ones to choose from.  You can even turn it into a team-based competition, with winner getting a small prize at the end of the “season.”

Embrace the great outdoors

Why spend time indoors when there’s so much to do outside?  If the weather is nice, and you have access to a public park or beach, consider gathering your friends and family for a picnic, volleyball game, frisbee toss or other outdoor games, or just to relax.  Make it BYO-style and, if one you has a portable grill everyone can use, even better.  Think of it as a tailgate without the game or concert (bring a speaker, and you can enhance the atmosphere).  You might even find a park or other public space with access to a grill or fire pit to make it even easier.

Look for local venues

If you’ve bought tickets to a big-name concert recently, you know all too well how high ticket prices have gotten, especially in larger venues.  Look for smaller concert venues and theaters locally.  You may find some great cost-effective options, regardless of what style of music or theater you’re looking for – and you might discover some great talent in the process.

How good of a time you have shouldn’t be dependent on how much you spend.  There’s nothing wrong with splurging on a night on the town or a stadium concert every now and then.  But, most of us can’t afford to do it regularly.  So, keeping both your budget and entertainment needs in mind, think about these and other low-cost options when planning your weekend activities.  You can keep your budget in check and, just as importantly, have a great time.

Nine Easy Cost Cutting Strategies to Boost Your Savings Now

Times have been tough for many people over the last few months.  As if the pandemic wasn’t enough of a headache, inflation is causing everyday items – from gas to groceries – to take a bigger chunk out of our weekly and monthly budgets.  Supply chain issues are also adding to the problem, allowing businesses to raise prices.  As a result, we have to be more aware than ever about the products and services we buy as we try to stick to our budgets.

Of course, some spending is necessary.  But, there may be some wasted spending that can be reduced – if not eliminated entirely – to help cut down monthly costs.  Even though the economic climate is less than ideal, it’s still possible to reach your financial goals by trimming the fat on unnecessary spending.  Here are a few cost-cutting strategies to consider that can help reduce extraneous expenses.

Pickup instead of delivery

Delivery services are great, but most of them increase the cost of your purchase.  Unless you’re really in a bind, consider picking up orders yourself to avoid paying those extra fees and tips for drivers.

Eat in, not out

We all need a night out from time to time but, if you eat out frequently, think about cooking yourself a few extra nights a week.  You don’t have to be a master chef to prepare a great-tasting meal, especially with all the recipe options available online – and you’ll have a pretty penny in the process.

Make your own cup of coffee

Along the same lines, if you stop at your local coffee shop on your way to work every morning, think about making your own.  You can find great-tasting coffee for less than .50 per cup.  That’s about a quarter of what you will pay at a coffee shop for just a basic cup of coffee.  If you do that every day, you can save hundreds of dollars over the course of the year.

Manage your insurance premiums

Shop around for better deals on your insurance rates.  Even if you think you are getting the best rates, if you haven’t shopped around in a while, you may be surprised.  Also, check to make sure your coverage makes sense for your current needs.  There may be many ways you can reduce your premiums.  Not sure where to look?  TMB Insurance Services works with more than 40 carriers to take the hassle out of comparison shopping.

Reduce your driving

The low prices were nice while they lasted, but gas prices have also gone up again.  Every time you fill up, you’re probably looking at the pump in amazement at how much it just cost you.  If you’re doing activities with others, think about carpooling with them.  The same goes for work.  Try to combine multiple stops when you go out, to reduce the number of trips you make.  Along those same lines, if you’re in the market for a new car, think about a fuel-efficient model.  Even if you’re not ready for an EV, you may be surprised at how quickly the savings can add up with a hybrid car.

Research deals

The internet is an amazing tool for finding deals.  Use it!  Don’t simply assume you’re getting the best deal possible.  Regardless of what you’re looking to buy, shop around online to see where you can get the best deals – and factor in shipping costs when buying from an online to make sure you are using the total cost.  You may be surprised to see how often you can find a sale, promotion, or coupon.  Loyalty programs are another great way save regularly.

Consider buying in bulk

Sure, it’s another annual fee, but if you use them enough, wholesale clubs, like Costco or BJ’s, can save you money, especially on items you use regularly.  When it comes to food, packaged properly, many food items will freeze well.  Or, you can cook in larger portions and freeze prepared dishes that make for quick weeknight dinners, or just use them as leftovers for lunch or dinner during the week – instead of eating out.

Reduce energy consumption

We all need power, but there are ways we can reduce our power consumption without impacting our living – just our utility bills.  Turn off powered items when not in use.  That includes lights – the only thing keeping all your lights on every evening does is increase your bill.  Look into replacing traditional bulbs with energy-efficient versions – either LED or CFL.  Run your dishwasher and laundry with full loads – this will also reduce your water consumption.  And use a programmable thermostat to adjust your heating/cooling when you’re not home.

Evaluate subscription usage

Do you belong to a gym?  Have a few streaming accounts or digital magazine or newspaper subscriptions?  Are you paying for an application you no longer use?  The modern economy is flooded with subscription-based plans for popular products and services.  We have become accustomed to automatic payments for recurring expenses like these.  It helps ensure we don’t miss paying bills, but it also makes it easy to forget what you’re paying for every month.  Subscription-based services only make sense if you actually use them. Otherwise, you’re just wasting money every month.  Make a list of all of your subscriptions and evaluate how often you use them and whether it actually makes financial sense to retain those subscriptions.

These are only a few ways you can save on a daily, weekly, and monthly basis.  Individually, they may not seem like much, but collectively and factored in over the course of a month or year, the savings can be very significant.  What you do with that extra cash is up to you, but one great option is to put it into savings using a savings app, like Plinqit.

Don’t let the state of the economy take you away from financial freedom. With smart shopping habits, informed decision making, and some help from your friends and family, your savings can continue to rise without much sacrifice.

Should you wait to start saving while you’re still paying off your student loan debt?

To pay it off or to save? If you have student loan debt, you’ve probably wondered whether you should finish paying it off before you prioritize putting away money for retirement, building a rainy day fund, and focusing on other financial goals.

The answer: both! While there’s no one-size-fits-all solution, building savings while you pay down your student debt is an effective strategy for many borrowers.

Here are four reasons why student debt repayment shouldn’t hold you back from saving:

Saving early is key to building a retirement fund.

When it comes to retirement savings, starting monthly contributions as soon as possible is key to maximizing compound interest — or returns on your investments and returns on those returns — over time.

However, 41 percent of millennials cite their student debt as the reason why they’ve delayed saving for retirement. With the average borrower taking twenty years to finish repayment, those who delay saving until their student debt is paid off will miss out on decades’ worth of compound interest.

Even waiting just five years to start saving for retirement makes a significant difference. Case in point: if you save $100 a month in a traditional IRA with a 7% annual rate of return from the time you start working at age 22 until you retire at age 65, you’ll have earned $279,914 in compound interest on top of your monthly contributions. If you don’t start saving until you’re 27, you’ll have earned $183,184 in compound interest— $96,730 less — by the time you retire.

You never know when you’re going to need to dip into your emergency fund.

The pandemic has proven that anything can happen — and building an emergency fund is one of the best ways to prepare for the unknown. Unfortunately, 43 percent of millennials say their student debt has prevented them from starting a rainy day fund.

While paying off your student debt as fast as possible can save on interest over time, you’ll likely wind up wishing you had saved that extra cash if you find yourself unable to afford manage essential expenses — like rent, utilities, groceries, transportation, childcare, and pet food — or pay unexpected bills — whether from a stay in the hospital or car repairs — in the event of an emergency.

Plus, once you’ve set aside the recommended three to six months’ worth of expenses, you’ll feel even more confident pursuing other financial goals knowing you’re covered if the worst were to happen.

Student debt isn’t necessarily bad for your credit score — and it can even help it.

Student debt does impact your credit score — but that’s usually not a bad thing.

While falling behind on your student loan payments can be detrimental to your credit score, making your required minimum payment on time each month can actually give you a boost. And because student loans appear on your credit report as installment loans — just like auto loans and credit cards — having student debt can improve your “credit mix”, which accounts for 10 percent of your score calculation. In fact, your credit score might even experience a slight drop when you finish paying off a student loan.

A good credit score has dozens of benefits, from lower insurance premiums and interest rates and perks like eligibility for premium credit cards to making it easier to rent a house or get a job. All of these factors can make it easier to set aside savings and maintain your overall financial wellbeing.

The Milford Bank can help you balance student debt repayment with savings goals.

For many borrowers, building savings while paying off student debt is easier said than done — but you don’t have to go it alone. The Milford Bank is partnered with Candidly to take the guesswork out of student debt while providing solutions to build long-term financial health.

Whether you want to find ways to lower your monthly student loan payments (and free up cash for savings), explore debt forgiveness programs, or pay down your student debt with cash back rewards and spare change, Candidly has the tools you need to reach your goals. Visit milfordbank.com/other-services/candidly/ to learn more about this value-added service and activate your free account today.

Parent PLUS loans: an overview

With the average cost for a year of college in the US up to $35,720, it’s no wonder so many students take out loans. But the average undergraduate borrower receives just $11,836 in student loans each year — a significant gap for most.

That’s where Parent PLUS loans come in. The Department of Education allows parents of dependent, undergraduate students to take out this type of federal student loan on their child’s behalf.

Parent PLUS loans can be an easily accessible option for families to help foot the bill for their children’s college education — something that many families need assistance with. But as with any financial commitment, there are careful considerations parents need to make before taking out a PLUS loan.

Parent PLUS loans: an overview

There’s no limit on PLUS loans (regardless of income), and parents can borrow up to the full cost of attendance minus any other financial aid their student receives. While that may be helpful to some borrowers, it can also quickly lead to taking on more debt than a parent can afford.

Any parent or legal guardian of a student who is enrolled at least part-time in an undergraduate degree program at a Title IV school can apply for a Parent PLUS loan via the Federal Student Aid website. A credit check will be performed as part of the application review process — but if the parent has a negative credit history, they may still qualify if they have a guarantor.

It’s important to be aware that parents are often offered a PLUS loan without ever asking for it. Many colleges will include PLUS loans in awards letters notifying students what financial aid they’ve been offered, so carefully reviewing aid packages before accepting is a must.

Repaying Parent PLUS loans

By default, borrowers are supposed to start repaying their Parent PLUS loans as soon as the loan has been disbursed, but borrowers can request to defer payment until after their child has graduated or left school.

Parent PLUS loans will start accruing interest immediately after they’re disbursed, even if the borrower is granted a deferment. While the interest rate is fixed for life at the time the loan is taken out, the interest rate for PLUS loans is often steep — in the last few years alone, rates have climbed as high as 7.6%.

Unlike many other federal loans, the repayment plan options for PLUS loans are somewhat limited: borrowers can choose between a standard, graduated, extended, or income-contingent plan. Income-contingent repayment (ICR) could help make monthly payments more affordable and forgive any outstanding balance after 25 years, but the PLUS loan must have first been added to a Federal Direct Consolidation loan before it is eligible for ICR.

Parent PLUS loan forgiveness and cancellation

ICR plans aren’t the only way these loans can be forgiven. Parent PLUS loans can also qualify for Public Service Loan Forgiveness (PSLF), provided the borrower meets certain eligibility requirements, including working full-time for a nonprofit, government, or other public service organization.

The circumstances under which a Parent PLUS loan can be discharged are limited. Declaring bankruptcy, for example, won’t automatically wipe PLUS loans away — a borrower must demonstrate specific financial hardship caused by the loans. Otherwise, PLUS loans are usually only discharged in the event that the student’s school closes while they’re enrolled, the school commits fraud, if the borrower becomes permanently and totally disabled, or if the borrower or student dies.

Managing Parent PLUS loans

Refinancing federal Parent PLUS loans with a private lender can help ease the strain for some borrowers. In some cases, refinancing can lower monthly payments and reduce the amount of interest a borrower will pay over time. But refinancing has its drawbacks, too: once a Parent PLUS loan has been refinanced, it cannot qualify for ICR, PSLF, or any other federal benefit.

Given the high interest rates, making extra payments to parent PLUS loans to reduce the overall payoff time can be a good strategy for borrowers on traditional (standard, graduated, or extended) repayment plans.

The Milford Bank is here to help

If you’re a Milford Bank customer with student debt, whether from Parent PLUS loans or any other type of loan, you’re in luck. The Milford Bank now offers Candidly as a value-added service to help customers manage — and pay off! — their student debt. Candid.ly offers smart tools that help you move beyond your student debt, including:

  • Reassess: Find, compare, and enroll in alternative repayment plans — including income-contingent repayment — in minutes.
  • Refinance: Get pre-qualified refinancing offers from dozens of lenders
  • Round Up: Collect spare change from everyday purchases and convert it into student loan payments
  • Giveback: Pay off your student debt with cash back rewards from online shopping

Visit milfordbank.com/other-services/candidly/ to learn more and activate your free account today.

 

Tips for Cutting Costs and Better Saving This Year

By Lynda Mason

The dawn of a new year is always exciting.  For one thing, it offers a fresh opportunity to break bad habits and think about new ways to make our own lives better.  Some people decide to eat healthier or visit the gym more often.  Others decide to spend more time with loved ones, or make an effort to contribute to the community.  But, if there’s one change we all can benefit from, it’s saving a little more.

Inflation, rising gas prices, and supply chain hold-ups are driving up costs across the board, making it harder for regular people to pay for everyday goods and services.  In fact, consumer prices are higher than they have been in 40 years.  Reducing spending and putting more into your savings can help balance these challenges, and can help you maintain financial stability in the coming months and years.

While certain spending is necessary, luckily, there are a number of simple solutions to help reduce expenses and build up your savings, without making major lifestyle changes or requiring significant effort.  Here are a few useful tips for cutting costs in 2022, ensuring your financial goals aren’t thrown off as a result of the current economic climate.

Monitor your subscriptions

Subscription services are incredibly popular, but there may be a few, or even several, you can cancel.  Whether it’s Netflix, Amazon Prime, Blue Apron, Spotify, or even magazines, there are subscription services for virtually every need.  Although many of these services are fairly affordable on their own, it’s easy to forget about how many subscriptions you have and how quickly they can add up in your monthly expenses.  Some people have so many subscriptions they forget about some of them altogether, leading them to waste money on services they don’t use.  Cancelling unused or rarely used subscriptions is one of the quickest ways to cut costs.  If you subscribe to multiple similar services, consider whether you actually use and need both or all of them.  Additionally, sharing services with family is a great way to reduce monthly costs.  Many services have individual and family plans that allow you to save on the overall expense.  Many also offer savings if you pay up-front for the year.  If you can afford that one-time larger payment, it’s a way to reduce your monthly spending even more.

Keep an eye out for deals

After two years of stale growth, many businesses are attempting to draw in new customers by offering specials and sales.  While mail has historically been a primary source for receiving coupons or promotional items, digital resources like social media and email have become more popular and many retailers have shifted to digital coupons.  It’s easy to disregard many advertising campaigns as nuisances but, there can be many great deals out there for products or services you purchase on a regular basis.  Be aware of promotions your favorite businesses are running; you may be able to find great deals to support your budget.

Free digital resources

Almost everyone has access to a smart phone or a computer, which means anyone can take advantage of a wide range of digital resources to make better financial decisions.  For instance, as gas prices rise, many people will go out of their way to find the lowest price when they need to fill up.  Apps like GasBuddy and Waze make it easy to determine which stations offer the lowest prices, without a fee.  In fact, app stores are flooded with price-checking resources to help you save on everyday goods.  Consider checking them out.   There are also digital savings apps, like Plinqit, which can help you stick to your saving goals.  The Milford Bank has partnered with Plinqit to make it simple.

Track Your Spending Habits

Cash used to be king, but digital payments are quickly becoming the norm.  They can also provide greater visibility into your spending habits (and debit/credit cards can provide a layer of purchase protection cash can’t).  Using your online banking account, you can consolidate your weekly and monthly purchases to analyze how much you’re spending and on what.   If you find you’re spending too much on certain items, you can consider cutting or reducing them from your budget to see how much can be added to your savings.  Analyzing your purchasing habits is a great way to make smarter spending decisions, and can keep you on the right path for financial stability.  There are also plenty of online tools for tracking your weekly or monthly spending.  You can also use a spreadsheet.  Regardless of how you do it, tracking you spending is a great step in setting and sticking to a reasonable budget that will help you save.

It’s common for people to make New Year’s resolutions, but incredibly rare for them to follow through for the entire year.  But nothing good comes easily and success requires work and dedication to see positive results.  Cutting unnecessary spending may seem easy, but it should be a priority.  Plus, once you’ve done it, you may be surprised at how little you miss those things you’ve cut out.  You’ll also be pleasantly surprised at how quickly small reductions in spending can add up.  Even if you think you’re comfortable with your monthly spending, saving more may help you fund larger expenses, like vacations, college tuition, home improvement projects, and more.  Regardless of what you are saving for, consider these tips to help make it a little easier.  And if you need advice, your local bank’s specialists are always happy to offer their advice.

Six Tips for Using P2P Payment Apps

By Dave Wall

In today’s digital world, most of what we do is somehow attached to our smartphones.  From our communication and social media to shopping and dining, you probably use a mobile app to get things done.  That includes banking.  Most of your banking features are available on right in the palm of your hand, including the ability to send money instantly.

In a world where many of us pay for just about everything with mobile apps and credit cards, the one thing that isn’t quite as easy as making an online purchase is sending money – at least not until money transfer apps like Zelle launched.  Zelle is one of several popular apps that can be attached to your bank account to send money to anyone you know instantly.

Whether it’s to easily split a lunch bill with friends, pay for your fantasy sports league, reimburse your Mom for a gift, pay your sitter, or any other reason, Zelle makes it as simple as handing cash over.  The difference is you don’t have to worry about carrying cash and you can do it at any time using your bank’s mobile app.  The only qualification is you and the other party both need to have Zelle connected to your bank accounts.

But, while P2P payment apps are very convenient, there are a few best practices you should follow to keep your money safe.

Use it like cash

Even though it’s a digital banking tool, think of Zelle like using cash.  If you have $50 in your pocket, once you spend it, it’s gone.  Once you send a payment through an app, you can’t cancel it.  It’s like handing cash to someone – once it’s gone, it’s gone.

Only send to people you know and trust

Because you can’t cancel payments once they have been made, make sure you know who you’re sending money to and why, and make sure you are sending to the correct Zelle user.  If you’re not sure, confirm with whomever you’re sending to.  The instantaneous nature of these payments is one of their best features, but they can also work against you if you’re not careful.

Make sure you send money to the right person

Once you send, the money is gone, so you want to make sure you are sending to the right person.  Many account names are very similar.  It’s good practice to confirm the accounts you’re sending money to so your payment doesn’t end up in the wrong hands, and you have to send more to then get it to the right person.

Know your app policies

Some apps charge fees for certain kinds of transactions.  Some charge for sending money using a credit card.  Some charge for transferring money back into your bank account (Zelle does not).  Regardless of what app(s) you are using, make sure you are aware of any fees you may be responsible for before you start sending or receiving money.  Carefully reading the terms of service is a good place to start.

Beware of scams

Make sure you know what you are getting when you use payment apps.  Scammers often try to get paid using apps because it’s very difficult for you to get funds back once they are sent.  If you see a deal that seems too good to be true, there’s a good chance it is.  Also understand that reputable sellers will offer multiple payment options.

Use available security features

Remember that while you should spend money through payment apps like cash, they aren’t quite the same because they require access to your financial information.  Make sure you are using the most recent version of your app, which should have the most up-to-date security updates.  Also look at what security features you can enable on your app and enable those that give you the highest level of security.

Following these simple guidelines will help you protect your savings, while allowing you to enjoy the ease of P2P payments, so you can send money to anyone you know, for any reason, instantly.

Are You a Renter Looking to Become a Homeowner?

By Paul Mulligan, SVP, Retail Lending

Last year, while many businesses and industries suffered, the real estate market in Connecticut had a phenomenal year, with a 17% increase in home purchases.  The 38,641 single-family homes bought was the highest in the state in 15 years.  One factor certainly was the fact that the number of people moving into Connecticut in 2020 was more than double what the state enjoyed during 2019.

One of the byproducts of the trend was an increase in home prices, which also grew. As a result, many people may feel they are being priced out of the home market.  Renters, in particular, are feeling less confident that they will be able to buy homes.  Just over a third of current renters say they are “not very confident” or “not confident at all” in their ability to buy a home.  The majority say their lack of confidence comes from home prices being too high or an inability to afford a down payment.

But, that shouldn’t mean renters should stop thinking about buying a home.   There are many benefits to owning, including:

  • Freedom to renovate/decorate
  • Building equity
  • Potential tax benefits
  • Value could increase over time
  • Stability of ownership
  • Predictable monthly loan payment (with a fixed-rate mortgage)

There are also many variables to consider when buying a home; including location, size and type of home, features, and of course, cost.  If you’re ready to buy a home – or even if you’re just starting to consider it – one of the first things you may want to consider is your priorities?  That includes what are the must have, nice-to-have, and unnecessary features.  If you’re willing to add flexibility to your process, you should enjoy greater home selection opportunities.

In addition, your local community bank may be able to offer you better mortgage terms that may make it easier for you to get out of paying someone else for your living space and start building equity in your own home.  For instance, The Milford Bank offers highly competitive rates with no-cost lock-in, low down payment options, free prequalification to make your home shopping experience easier, decisions made locally by a bank with a long history of serving the local community, and mortgage professionals that focus on your individual needs as a local customer.

In addition, if you’re a renter looking for your first home, The Milford Bank offers a First-Time Homebuyer program within Milford, Stratford, West haven, and Orange; that includes a rate reduction from the standard rate, application fee refund on closing, and low down payment options. The Milford Bank also offers a special rate for single family dwelling purchases, regardless of location throughout the state of CT.

You may also want to consider current versus future plans.  When looking at homes and talking to your bank, consider how you might be able to expand a potential home in the future to meet additional needs or to add some of the nice-to-have features that might not be feasible initially.  You may even be able to use the equity you build in your home over the years to take out a home equity loan or line of credit to fund home improvement projects.  Alternatively, The Milford Bank offers a construction-to-permanent one closing loan option, which includes the option of a fixed rate and an interest only period of up to 12 months during the construction phase.

The bottom line is, if you are looking to buy a home – whether you’re tired of paying a monthly rent to a landlord or association or you simply want the freedom and convenience of owning your own home – don’t let your lack of confidence keep you from achieving your dream.  Talk to The Milford Bank’s local mortgage specialists, who can provide you with the information and assistance you need to make a truly informed decision to assist you in purchasing a home that fits your needs and budget.

What the Federal Student Loan Payment Freeze Extension Means For You

By Jorge Santiago

If you have federal student loans, you probably already know that emergency payment suspension has been extended to January 31, 2022.

Between recent student loan servicer shakeups, the Covid-19 surge, and 90 percent of affected borrowers saying they’re not prepared to resume payments, the decision to extend the payment freeze beyond September (as previously scheduled) comes as a relief for many borrowers.

But do you know how to use this additional extension to your advantage? Don’t just think of the extension as extra time without federal student loan payments — think of it as extra time to plan, to save, and to get ahead.

Here are some things you can do help put your best financial foot forward until federal student loan payments resume:

Get in touch with your student loan servicer

Contact your student loan servicer to confirm your payment due date, reconnect a payment method to auto-pay your bill, and learn about any new policy changes. If you’ve moved since March 2020, be sure to update your mailing address, too.

If your loans are serviced by FedLoan, Granite State, or Navient, be advised that these servicers have announced that they will transfer their student loans to other servicers before the end of the year. With that in mind, you may want to keep an extra watchful eye out for updates about the transfer in the event that you need to take any action with the new servicer.

Make sure you’re on the best path forward

Now is a great time to explore your eligibility for new federal repayment plans and forgiveness programs.

Switching to an income-driven repayment plan, for example, could lower your monthly payment and get you on track to have outstanding debt forgiven after a certain number of years. If you work for a non-profit, government, or public service organization, you may also qualify for Public Service Loan Forgiveness, which forgives remaining loans after ten years of qualifying payments.

Consider making payments

It may sound counterintuitive, but for some borrowers, the suspension period is the perfect time to make student loan payments.

That’s because the interest rate for federal student loans is still 0%, so any payments you make during the freeze will apply directly to your principal — which can ultimately lead to paying off your student debt sooner.

Get ahead on other financial goals

The average monthly student loan payment is $393 — a major expense that often forces borrowers to delay other financial goals until their student debt is paid off. For example, did you know that more than half of non-homeowner borrowers say their student debt has delayed their ability to buy a home?

Without the expense of monthly student loan bills, now could be the perfect time to get ahead on other priorities like saving up for a down payment, making extra retirement fund contributions, opening an emergency savings account, or setting aside cash for a major purchase.

Learn how The Milford Bank can help

When it comes to student debt, you don’t have to go it alone. The Milford Bank has partnered with Candid.ly, the leading student debt repayment platform, to give customers the tools they need to help make managing their student loans easier than ever before. Visit milfordbank.com/other-services/candidly/ to learn more and activate your free account today.

Do You Plinqit?

By Celeste Lohrenz

We all know we should be saving money.  From the time we got our first summer jobs during high school, our parent’s almost certainly tried to convince us to put most of it in the bank.  Even though we know we should be saving, most of us probably didn’t do it as well then, and probably aren’t doing it as well as we should or would like to now.

Almost 60% of Americans have less than $6,000 saved (42% have less than $1,000).  Only 14% of people under 54 see retirement savings as a priority, even though we should be saving 10-17% of our income in order to retire at our current standard of living – that’s if we start saving at the age of 25.

Without a plan for saving consistently, it’s hard to cover any larger expenses, including emergencies, college tuition, weddings, a new home, vacation, and many other things.  It’s important to start saving early for all of these things so that when they happen, you’re prepared.

One of the best things you can do is automate your savings.  For your retirement account, you can have contributions deducted from your paycheck and deposited into your account.  For other saving needs, have you considered Plinqit?

Plinqit is a digital savings tool offered by The Milford Bank and HT Mobile Apps to make saving easier and more fun.  You simply set up your Plinqit account and define specific savings goals.  You can even set up five different goals, so you can track progress towards each individual target separately.  Your Plinqit account is connected to your checking account, so once the saving goal is set up, you don’t have to do anything other than watch it grow.

In addition, you can earn small bonuses by watching videos or reading articles designed to help increase your financial education, so you you’ll learn more about money while earning, too.  You can also earn bonuses by reaching your savings goals and referring others to use Plinqit.

Plinqit is free to use, and you can download a mobile app to your Apple or Android device to manage your account easily.

Most importantly, though, using an automated tool can help you save more effectively without having to remember to add to a separate account manually.  Once you set it up, it just happens and your vacation, emergency, or other savings will grow.

If you have questions about Plinqit, savings accounts, or any other financial needs, our banking experts are here to help.

Student Loans 101

by Jorge Santiago

College is expensive. In the 2020-2021 academic year, the average private college’s tuition and fees was $35,087; public colleges averaged $21,184 for out-of-state students and $9,687 for in-state students. Multiply that by at least four years, and the total cost of a degree is one very few students — or their families — can afford out-of-pocket.

That’s where student loans come in. Student loans create opportunities for students who might not otherwise be able to afford their education, which can in turn lead to more stable, gainful, and fulfilling employment.

But student loans are just that — loans that must eventually be paid back. If you’re one of the 47.9 million Americans carrying a combined $1.71 trillion in student debt, you probably already know that repayment can be a strain. And if you’re considering applying for college loans, you should understand your options before taking on student debt.

So let’s get back to the basics. Here are four questions everyone with student debt — or considering taking out student loans in the future — should know how to answer:

What types of student loans are available?

Types of federal student loans

As their name suggests, federal student loans are offered through the federal government via the Department of Education’s Office of Federal Student Aid (FSA). Three different types of federal student loans are available: Direct Subsidized, Direct Unsubsidized, and Direct PLUS.

  • Direct Subsidized Loans are available for undergraduate students with financial need (the difference between your school’s cost of attendance and your household’s expected contribution). Interest rates are fixed for life when the loan is first disbursed and are generally lower.
  • Direct Unsubsidized Loans are available for both undergraduate and graduate students, regardless of financial need. Interest rates are fixed for life when the loan is first disbursed and are generally higher.
  • Direct PLUS Loans are available to parents financing their child’s education, and to graduate or professional students funding their own education. The application process requires a credit check, but borrowers with low credit scores can still qualify if they have an endorser or can document extenuating circumstances. Interest rates are fixed for life when the loan is first disbursed and are generally the highest rate compared to other federal student loans.

Types of private student loans

Private student loans are offered through financial institutions like banks and credit unions. The terms of private student loans are controlled by the lender, so there are lots of different options available. Private loans often entail higher interest rates and stricter eligibility criteria, but they can be a helpful tool for borrowers who have already maxed out their federal aid.

 

How does student loan repayment work?

Federal student loan repayment

If you have federal Direct Unsubsidized or Direct Subsidized Loans, your loans will be in deferment while you’re still in school and for six months after you graduate or withdraw. After this grace period ends, you’ll be responsible for making monthly payments through your loan servicer (FSA will assign your servicer — a third-party company that manages student loan billing — after your first loan is disbursed).

Direct PLUS Loan borrowers can expect a very similar process, with the exception that you must request deferment through FSA or your student loan servicer. Otherwise, you’ll have to start making payments while you are or your child is still in school.

All federal student loan borrowers will have the opportunity to select a repayment plan when they first start making payments and adjust their repayment plan later on. There are eight different federal student loan repayment plans available, including income-driven repayment plans, which cap monthly payments to a manageable percentage of your discretionary income.

Private student loan repayment

Private student loan repayment varies based on your lender’s terms. Some require payments while you’re still in school or immediately after graduating, some manage repayment through a servicer or in-house, and repayment plans vary. If you’re considering private student loans, be sure you understand the lender’s repayment policies.

Can I get my student debt cancelled, paused, or forgiven?

If you have private student loans, your options for getting your loans cancelled, paused, or forgiven are limited.

But if you have federal student loans, it’s possible — provided you meet certain eligibility requirements.

You may be eligible to have your federal student loans partially or totally cancelled if:

  • Your school closed while you were a student or shortly after you withdrew or graduated
  • You develop a total and permanent disability
  • You were defrauded by your school
  • You declare bankruptcy

You may be eligible to have your student loans paused if you apply for and are granted temporary deferment. You might qualify for deferment if:

  • You’re enrolled in a graduate fellowship
  • You’re undergoing cancer treatment
  • You’re serving in the Peace Corps
  • You’re on active military duty
  • You’re receiving welfare assistance
  • You work full-time but earn 150% below the poverty line

You may be eligible to have your student loans forgiven through special forgiveness programs if:

  • You’re a teacher
  • You work at a nonprofit organization
  • You work for a federal, state, local, or tribal government agency
  • You’ve been on an income-driven repayment plan for at least 20-25 years

How can The Milford Bank help me manage my student loans?

When it comes to student debt, you don’t have to go it alone. The Milford Bank is excited to launch a new partnership to give our customers tools that make managing their student loans easier than ever before. Stay tuned for an announcement soon!