7 Things You Think You Know About Credit Scores, But Don’t

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By William LoCasto

When was the last time you checked you credit report?  If you’re like many people, it’s probably not frequently enough.  The good news is you can do it at least three times a year at no cost, because the three major credit reporting agencies are required to provide one free credit report a year.  In addition, your bank may offer additional services for checking you credit.

You credit scores and report will be a factor for so many decisions you make in life.  With many major financial commitments, you credit report is likely to be checked.  When you’re buying a home, your mortgage lender will look closely at your credit report.  The same goes for car loans.  Credit card companies check to determine not only whether they are willing to offer you credit, but also your card limit and interest rate.  Utility and phone companies may also want to check to determine how likely you are to pay your bills, or whether they should require a prepaid plan.  Even prospective employers often check credit reports.

The bottom line is that your credit report will play a role in most major events in your life.  This means it’s in your best interest to check you scores regularly for any anomalies, and so you know if you need to take steps to improve your score.  Checking your score is a great start, but only if you know how they actually work, which isn’t always easy.  For one thing, about a year ago, FICO (the most widely used credit scoring resource used by lenders), updated its scoring system, which could impact your score.

Aside from that, there are a number of common misconceptions about credit scores that could prevent you from improving your credit ratings.

Checking your credit report impacts your score

This is not true.  You can check your own credit score as often as you want without any impact.  However, if you are applying for credit from multiple sources, such as a car dealer, a mortgage lender, and a retail store, those credit checks could slightly dip you score.

Accessing lines of credit doesn’t impact your score

Again, this is not true.  The amount of credit you have used, compared to your available credit, is one of the biggest factors in your credit score.  A lower utilization rate is better for your overall credit.

Income changes your credit score

Yet again, this isn’t true.  Your job and income history has no impact on your credit score.  It is, however, used by lenders to determine how much they are willing to lend you.

Closing credit cards can improve your score

This is also not true.  In fact, if you close a credit card at the wrong time, you might actually lower your score because you’re reducing your available credit, which will increase the percentage of credit you’ve used.  That’s not to say you should never close credit accounts – there are often very good reasons to do so, but be aware it could impact your score.

Marriage changes your credit score

You guessed it, not true.  Credit scores aren’t like taxes; they aren’t combined into households.  Your credit score is yours alone.  Lenders, though, may ask for information about your spouse to determine your loan amount and interest rate.

You need to have a perfect score

Also false.  While it’s possible to have a perfect credit score, there’s isn’t a benefit.  Once you have reached high credit worthiness, making it perfect won’t create any noticeable benefits, other than knowing you have a perfect score.  That’s not to say you shouldn’t strive for perfection, but you also shouldn’t worry about not reaching it with your credit score – it won’t hurt you.

Poor credit is forever

This may be the best misconception of all.  Unless you have perfect credit, you can always improve your score over time.  The key is to not only understand what goes into your credit score, but to start following smart financial habits, including creating and sticking to budgets, paying off existing debt, and cutting out unnecessary spending.

There are many other questions that don’t have simple yes or no answers when it comes to credit scores.  For up-to-date information on what impacts your credit score and what doesn’t, or for advice on how you can start rebuilding your credit, talk to your bank’s experts.  Remember, you credit score will impact you for your entire life, but just because you don’t have a high score today doesn’t mean you can’t improve it.

Making New Year’s Resolutions That Will Actually Be Helpful

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By Celeste Lohrenz

As we reach the end of what has been nothing short of a challenging year – and hope 2021 will bring good news – it’s time for the age-old tradition of making New Year’s resolutions.  Most people, though, don’t follow through on them.  But, the key to making them stick is to make resolutions that are specific enough and achievable and, importantly, beneficial.  If you have a vested interest in keeping your resolutions, you’ll be more likely to do so.

Taking stock of your financial situation is a great place to start.  Then, you can look at where you may need or want to make changes in your spending or saving habits to improve one or more areas of your personal finances.  You can certainly do these things at any time, but if you need a little additional motivation, try making a financial New Year’s resolution and see how it changes your financial outlook by this time next year.  It’s something you have control over, and improving your finances will have short and long term benefits.  Here are a few suggestions.

Stick to your budget

One of the most important tools for financial responsibility is your budget.  Without one, it can be difficult to manage your spending and increase savings.  If you haven’t created a budget, start with understanding your monthly spending, then you can start to build a budget and see how that relates to how much you want to save.  If you already have a budget, review it to see if you can cut any spending to help save more.  But, make sure you create a reasonable budget.  If you set one that’s not realistic, you will not only fail to stick to it, but once you go over budget once, your spending can snowball quickly.

Check your credit report

Your credit score is a key factor in how banks decide whether to lend you money or not, and also what interest rates borrowers will get, which can all impact your ability to finance major investments, like homes or cars, or to get credit cards.  You can see your credit score every time to log into your online account here at The Milford Bank.  If there’s nothing suspicious and your credit score is strong, you won’t spend much time on it.  But, if you need to improve your score or notice something wrong, make it a priority to fix it.

It’s easy to say you’ll eliminate all your debt, but it’s a lot harder to do it if you have significant credit card balances, auto loans, student loans, or other debt.  Reducing it is much easier.  Try setting incremental, more achievable goals, like paying off one loan at a time, or paying an extra $50 or $100 a month on your credit card.  Even if you don’t pay it all off by the end of the year, you’ll have made significant progress that you can carry over into the following year.

Automate saving

Saving isn’t always easy, but using automated tools, like Plinqit, can help you reach your small and large saving goals by automating your savings deposits.  Regardless of what you’re saving for – college tuition, a wedding, the down payment on a new home, or anything else – you no longer have to remember to put money away.  Instead, set your goals and watch your savings grow each month.

Build an emergency fund

The thing about emergencies is you never know when they may happen.  Your roof may start leaking, dishwasher may stop working, your car may need a new engine, or any number of other things may come up that require access to funds.  That’s where having an emergency fund is can be a major benefit.  Instead of dipping into your savings or accumulating debt, an emergency fund provides security for any unexpected situations that come up, including loss of income.

Save for retirement

It’s never too early to start building your retirement nest egg.  It’s simple logic – the earlier you start, the more you are likely to have when you retire.  Whether you have a 401k plan or IRA, try maximizing how much you put into it each month, while still maintaining a reasonable budget (especially if your company matches your contribution).  You may also want to pay more attention to how your contributions are being invested.  Talk to your financial advisor if you’re not sure how to effectively manage your investments.

Start banking digitally

Just about everything we do these days can be done online.  If you haven’t yet tried online or mobile banking, you haven’t experienced the freedom and flexibility it provides.  Most of your everyday baking transactions can be done through your bank’s website or mobile app, reducing the number of trips you have to make to the branch and giving you more time to enjoy doing other things.  If you need help setting up your online account or mobile app, our bank’s specialists are ready to help.

Review your will

Nobody wants to think about it, but creating a will and making sure it’s updated as your financial circumstances change can be a huge help to your loved ones when the time comes.  Take the time to meet with a professional to document how you want your assets allocated, and enjoy the peace of mind that you’ve made things a little easier for your family in the future.

These are just a few ideas for kicking off the new year with a positive financial outlook.  Once you have assessed your current situation, you may find other ways you can improve your financial wellness.  The key is finding something that makes sense while setting a goal that is achievable yet meaningful enough to make you want to follow through.  Whether you’re looking at short-term benefit or long-term opportunities, you can’t achieve them if you don’t set objectives and create a path to financial success.

Safe Shopping Tips for the Holidays

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The holiday shopping season is upon us.  Starting with Black Friday and running through Christmas, the next month will be the busiest shopping period of the year – as it always is.  Each year, online shopping has increased, due to convenience, availability, free shipping from many retailers.  This year, the trend will be even more significant, considering the unprecedented circumstances that continue to surround us with the global pandemic, driving more people to do much of their shopping online.  It also means cyber criminals will be even more dangerous than ever, trying to take advantage of people looking for great deals.

Be aware though, that not all deals are good ones – some are likely to be scams targeting unsuspecting shoppers during peak periods where many people lower their guard in an effort to save or get popular items.  As you do your online shopping, keep a few simple rules in mind to help protect you and your personal information.

Check out sellers – It’s worth doing some research on online retailers, especially ones you don’t know and haven’t used previously, to make sure they are legitimate.  Online and social media reviews can be a good source of information, since customers are typically very quick to post about poor experiences and fraudulent site.   You can also look up companies at the Better Business Bureau.  The BBB also has a scam tracker site where you can look up (or report) scams.  It’s currently showing more than 200,000 scams.  If you’re buying through P2P services, like eBay, make sure you look at the seller’s history, ratings, and feedback.

Hard to find items – Be aware of offers promoting hard to find items.  Scammers often target buyers by offering deals on hard to find items.  Be aware of this and be sure to do your research on retailers.  Though it’s not always the case, if items are sold out at popular retailers – including the brands own e-commerce site – it’s not very likely they are available from other sources.  Your best bet is to shop early to avoid missing out on these items and setting yourself up to fall for a scam.

Be cautious with links – You’re likely to get countless emails from retailers promoting sales and gift ideas.  Many will be legitimate retailers you’ve purchased from in the past but, it’s almost a certainty there will also be fake ones looking to steal your personal information and money.  Some of the emails or texts you receive about amazing offers may contain links to fake websites.  Follow safe practices by carefully inspecting or searching any URLs before clicking on them, looking for typos or poorly written emails, and keeping an eye out for fake sites with URLs that are close to legitimate brands.  Instead of clicking on email links, you may want to search for brands and get to their sites that way.  Sales and specials are usually available directly from the websites as well.  If not, it may be a scam.

Use credit cards – Whenever possible, pay with a credit card.  Most major credit card issuers provide online purchase protection, so your liability will be limited, if any.  Some banks are also extending the same protections to their debit cards, so you should check with your bank to understand your liability.  Using a credit card instead of a debit care also means your primary bank account won’t be compromised if your card information is stolen.

Online payment platforms – Online payment platforms, like PayPal, Google Pay, Apple Pay, and others are another alternative available at many retailers.  The benefit is you are still using your credit card, but because you’re authorizing payment through the third-party platforms, your payment information is never seen by sellers.

Use only secure sites – Always make sure you are shopping on secure sites, indicated by the small closed padlock icon next to the URL in your browser.  While the icon doesn’t guarantee the legitimacy of the seller or the security of their payment system or website, it does mean you have a secure connection to the site, reducing risk of your data being intercepted.

Protect your accounts – Most retailers will allows you to make purchases as guests.  If you don’t have to, don’t sign up for an account with every seller, especially those you aren’t likely to use repeatedly.  For those you do have accounts with, follow your normal best practices, including strong passwords and two-factor authentication to protect accounts.  2FA typically works by sending a confirmation code to your mobile device to confirm your identity.

Security software – Hopefully, you already have a good security solution installed on your home and mobile devices.  They can help protect you against cyber criminals by alerting you when you are trying to access an unsecure or potentially fraudulent site, in addition to all the other security features that help keep your information safe.  As a regular course of action, you should make sure your software is always up to date.

Following these guidelines can certainly help protect you as you do your holiday shopping, but they are good steps to follow all year long.  But, even if you are careful, there’s always a chance your information may be exposed or you may make a mistake.  If you think something has gone wrong and you may have been a victim or fraud or exposed your information, contact your bank immediately to alert them and block your accounts.

How to Protect Yourself from Work-at-Home Scams

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By Matt Kelly

Working from home has been an emerging trend for a few years, as technology has enabled an increasing number of jobs to be completed from anywhere. This year, in particular, though, has seen a massive increase in the number of people working from home. Some are temporary changes, but many companies have seen the benefits of enabling remote working and have already announced long-term of even permanent expansions of their previous WFH policies.

On the surface, it’s a great opportunity for many people who may be looking for primary or secondary income sources, or who have kids or elderly parents at home who need regular attention. It’s also a way for people to save a little more by avoiding commuting costs – including fuel, wear and tear on vehicles, and eating out regularly.

But, as working from home has become more common – a trend most experts agree is likely to continue – scam artists have recognized that many people are looking for opportunities, whether they have lost their jobs, are looking for a supplemental source of income, or need a remote work opportunity to support children in distance learning environments.

They are preying on the uncertainty and stress that the pandemic has created, hoping to trap people into their scams. The only way to avoid it is to stay informed, be smart, and know what to look for, and look for red flags. These include:

• No skills or experience required – While this may not be the case 100% of the time, most jobs require at least some limited experience or at least have some qualifications (even entry-level jobs).
• High pay rate for limited effort – As the saying goes, you can’t get something for nothing. If it feels like a job offers a higher pay than the work that’s being required, it’s likely to be a scam.
• High return guarantees – Look out for “business opportunities” or “partnerships” that claim to pay off quickly, or that are dependent on your ability to recruit others. These are most likely pyramid schemes.
• Up-front payments – Be wary of any company asking you to pay in advance for training, certifications, manuals, or other materials. You may spend the money and never hear from the company again.
• Pressure to sign – Be wary of offers that try to pressure you to sign up or onboard quickly, including on-the-spot offers without any meeting (whether in-person or virtual). Most legitimate companies will want to speak with prospects before hiring.
• Bank details – Look out for companies asking for your banking information right away. Unless you are 100% certain you have been hired for a real company, you could put your financial information at risk. If you have any concerns, you can always ask your bank’s experts whether something seems off.
• Respected source – Just because you see an offer in your daily newspaper or in a popular job site, don’t assume the opportunity is legitimate. It could still be a scam, and if you see something that doesn’t appear quite right, check with the paper or site and report your concerns.
• Testimonials – Fake offers can easily generate many false references that leverage emotional response to difficult or relatable scenarios (e.g., single moms, COVID-19 job loss, etc.), to get people to buy into their scams.

That said, there are plenty of legitimate work-from-home opportunities out there, and there are steps you can take to verify them before going further.

• Do your homework – Check out the company with state or local agencies, and the Better Business Bureau to see whether the company has a good reputation. Also make sure the company is following the FTC’s Business Opportunity Rule, which requires employers to disclose information about opportunities they are promoting, including references to back up their earning claims. Also check out the company and its management through online resources to see their histories and reputation.
• Ask detailed questions – Make sure you get specific details about how you will be paid, what your compensation structure will look like (salaried, commission-based, combination of the two), who will pay you, how soon will payments begin, are there any costs to the offer and, if so, how will those be paid and what will you get for it?
• Be smart – The moment you feel something isn’t quite right, don’t hesitate to pause the conversation to do more homework, or even just reject the company outright. Any legitimate company will understand your desire to think things over and generally do your research. In fact, some will even view it as a positive trait.
• Job sites – While it’s not foolproof, there are several reputable job sites that specialize in online or work-from-home opportunities and perform pre-screenings on their postings and companies.

Scammers are smart, and they know how to prey on people’s emotions, especially when it comes to financial issues. Your best defense is knowledge and common sense when looking for a job. In addition to these other guidelines, following one simple rule can help protect you and your personal information: “If it seems too good to be true, it probably is.”

How to Avoid Phone Scams

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By Pam Reiss

Your phone is probably ringing a lot more than you would like it to, and often, you have no idea who is calling.  We recently talked about how to deal with the annoying sales and marketing calls (phone spam) that we’re all being bombarded with.  But, there’s another big problem that can be an even bigger nuisance: phone scams.  These calls come from criminals looking to prey on unsuspecting victims to get money, information, or both.  There are many different scams going on at all times and they leverage fear, compassion, or simply ignorance to get people to give them information.

Threats, prizes, special promotions are some of the more common tactics scammers use:

  • Debt collection agencies demanding payment;
  • Social Security Administration representatives saying there is an issue with your Social Security number;
  • Lottery scams claiming you’ve won a big prize but need to provide personal information or pay the taxes on your winning;
  • Arrest threats from scammers impersonating the IRS other federal entities;
  • Charities looking for funding, especially after a natural disaster or other crisis;
  • Tech support calls claiming you have a virus or other problem with your laptop or other device, asking you to let them log into your machine remotely.

Currently, there are also many COVID-19 scams circulating, with callers offering masks or sanitizer, testing services, work-from-home opportunities, debt consolidation, or loan repayment plans.  Other scammers are claiming to be with contact tracing services and may tell you there’s an outbreak in your area.

The most important thing to understand if you answer the phone is to never give out any personal information to anyone you don’t know.  That includes things as simple as confirming your name, address, email, or any other information.  Every piece of information you provide, regardless of how irrelevant it may be, is likely to be added to a growing file that scammers piece together and can use or sell to other scammers.  Realize that legitimate organizations aren’t going to call you and ask for sensitive information.

There are really two good options for handling calls from people you don’t know. 

The first is in situations when you answer the phone and realize it’s not someone you know.  Hang up immediately.  That’s the easiest way to avoid giving away any information.  Don’t engage callers, don’t threaten them, don’t even speak to them.  Once you start talking, they realize you are not only willing to answer the phone, but will engage them, which is yet another valuable piece of information.  Don’t even follow prompts to push certain buttons, and do not return single-ring calls.

If you think it may have been a legitimate call from your bank or some other organization, call them – not the number that just called you, but look up their main number – and find out if the call was real.  Legitimate callers won’t mind that you are taking extra precautions.

The other solution many people have started using is to simply not answer the phone if they don’t know the number or it’s not in their phone’s contact list.  Even if you think you might know the number, realize that scammers can easily spoof local numbers to make people think a friend is calling them.  In most cases, friends, family, and other legitimate callers will leave a message and you can call them back.  By not answering, you’re not even providing the small bit of data that you are likely to answer a call – which is valuable information to scammers.

You can also use technology to help.  Your home and mobile phone providers offer tools to help identify or block unwanted calls.  Check with your provider to see what options are available.  Most mobile providers have free and paid versions of call filtering apps that can help protect you.

If you do receive a scam call, you should also report it to the FCC.  How much information you provide is up to you, but the more information you are able to give, the more detail the FTC has to analyze complaint data and identify and react to ongoing scams and identify the individuals behind them.

Scammers count on their victims not being smart enough to figure out what’s going on before it’s too late.  Understanding the tactics scammers use and the ways they try to get information from you can help your identity and your money, and help avoid having to deal with recovering funds (which may not always even be possible) and identity theft.

9 Tips for Safe Online Shopping

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Not surprisingly, online shopping has increased significantly over the past four months, with restaurants and retail stores being closed and even those that were open using curbside pickup or delivery.  That trend continues, and even when the pandemic subsides, almost half of consumers say they will continue to use online shopping for home delivery or curbside pickup.

Many have found that online shopping is simply a more convenient option.  In many cases, it offered an opportunity to get items that were otherwise unavailable because stores were closed or items were out of stock due to high demand.  That’s all true, as long as the items arrive as scheduled.

But, many people have also reported not receiving their purchases.  In fact, the FTC says it has received more reports of problems with online shopping, with more than half saying they never received their items.

In some cases, there have been delays, or items have simply gotten lost in transit.  Companies like Amazon typically do a good job letting customers know when their items are delayed.  In many cases, if the item is lost somewhere in transit, Amazon will offer customers the opportunity to request a refund, even though the item may eventually still arrive.  It’s good customer service.

Over the past several months, thousands of unverified, fraudulent sites have popped up claiming to have many high-demand products available.  Once they receive payment, they simply don’t ship the items and, when customers call to inquire, they claim delays due to the pandemic to avoid being detected as fake for as long as possible.  It was a concern even before the pandemic, which only created another opportunity for fake sites.  Some of these sites even mimic legitimate retailers, making it even harder to tell what’s real and what’s not.

The good news is there are ways to limit your exposure to these scams.  Here are a few tips for smart online shopping to help you steer clear of any issues and make sure you get the products you order.

  • Try recognized brands first. They may not always have what you’re looking for, but it’s a good place to start.
  • Be wary of sites selling products that are in short supply, or name brand products at much lower prices than you would normally pay.
  • Make sure the website is and HTTPS site (not just HTTP), indicating a higher level of security. This is important any time you make online purchases.  Also click on the padlock next to the web address, which will give you even more information about the site’s security.
  • Also check the URL itself. Some fake sites use addresses very similar to legitimate sites to fool people.  If you typed in the address manually, double check it to make sure you didn’t make a mistake.
  • Keep your browser updated. Most browsers will warn you if you’re about to go to an unsafe site.
  • Also keep you security software updated. This is another tool to help avoid malware from suspicious sites.
  • Examine the reviews. Many sites pay for fake 5-star reviews that all sound about the same.  Look for a variety or reviews and ratings.  You can also use sites like Fakespot, which analyzes and rates the validity of reviews on sites.
  • Other resources are available to help check website reputation, like URLVoid or Google Transparency Report. You can also check the Better Business Bureau for its ratings.
  • Pay with a credit card. This may be the best way to protect your money when buying online, regardless of the site.  If something happens and you don’t receive your purchases, or if they aren’t as advertised, you can contact your credit card issuer to dispute the charges if.

Online shopping is often very convenient, and it can be a way to get items that aren’t readily available locally.  But, there’s no question scam sites are a growing issue.  But, scammers are successful because they rely on unsuspecting victims.  Arming yourself with the information and tools to avoid scams or low-quality product knock-offs will help keep you from being disappointed or losing money.

Saving Money Doesn’t Have to Be Difficult

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By Cortney Meng

The COVID-19 pandemic has created a financial mess for many people.  Some were laid off, others were furloughed or had shifts reduced, and college students had a hard time finding sources of summer income.  Nearly 70% of American household incomes have been impacted.

The disruption has caused millions of people to dip into their savings accounts, emergency funds, and even retirement savings to manage during the pandemic.  Others have built up credit card debt or have taken out personal loans.  The situation has caused people to rethink their finances, with three-quarters of Americans saying they plan to either save more money in general or put more towards their emergency funds.

That’s not always easy, but personal savings apps like Plinqit – by HTMA Mobile Apps – can help.  With Plinqit, you simply set up your account, define your savings goals and a schedule for making deposits to the account.  Because the Plinqit account is linked to your checking account, there’s not additional effort needed, and Plinqit accounts are FDIC insured, so there is no risk.

The idea is that Plinqit will help eliminate the challenges with saving, including simply remembering to add to your emergency or other savings accounts.  Depending on your goals and means, you can select to add to your Plinqit savings on a weekly, bi-weekly, or monthly basis, and you can define the amount that is deposited.

You can check on you progress through the app at any time to see how you’re progressing towards your goals.  You can even set up to five separate saving goals at once.

Plinqit is free to use, though  you may want to add a “break the safe” penalty for withdrawing funds before you reach your goals to help discourage dipping into the account.  But, maybe best of all, when you achieve your goals, you will be rewarded with an additional amount.  You may also earn additional savings by referring others to Plinqit, or by using the Plinqit tool-builder that will help you learn even more about saving money.

There’s never a bad time to start saving, but now may be just a little better.  The Milford Bank is currently offering a $25 savings bonus for singing up an achieving a savings goal through Plinqit.  The thing with saving is that every little bit helps, and small amounts add up to significant savings quickly.  And it works – Plinqit users have saved more than $1 million since the service was launched last year.

Whether you’re replenishing your emergency fund or just starting one, trying to pay back a loan, or have a wedding or other expense in the future,start saving now so you won’t have to worry when you need the extra money.

Sign up at milfordbank.plinqit.com by August 15th and get a $25 bonus upon completion of your primary goal!