Making the Most of Your Paycheck in 2020

By Lynda Mason,

Group Manager, Post Road East Office; Woodmont Office

Now that we’ve started a new year – a new decade, in fact – many of you may have made New Year’s Resolutions to be more financially responsible, to spend a little less and save a little more.  It’s a great approach to your finances, and it’s never a bad idea to take a close look at how you’re spending your income.  But, if you didn’t make a resolution, that’s OK – only 8% of resolutions are kept, and 80% fail within the first month.

So, if you did set one and want to make sure you are able to keep it, or if you simply want to take a fresh approach to your personal finances this year, there’s no time like the present.  The key is having specific, attainable goals and a strategy for success that is both challenging and feasible.  With that in mind, here are a few tips that will help you adjust your strategy for saving this year – and keep your New Year’s personal finance resolution if you made one.

Define your goals

The first step when you’re looking to make financial changes is to know what you’re hoping to achieve.  It’s hard to evaluate how well you’re doing if you simply say, “I am going to be more responsible with spending.”  There are many reasons to reduce spending and increase savings – you need to identify your objectives in order to project how much you need to reduce your spending.  A few examples include:

  • Pay off credit card debt or mortgages
  • Build retirement savings
  • Start a college fund
  • Save for down payment on a home or car
  • Start a rainy day/emergency fund
  • Plan for other major expenses (remodel, wedding, etc.)

Knowing what you are saving for provides motivation for sticking to your budget.  Once you have decided what your goals are, you can set target amounts to start budgeting.  You can always adjust these, but having a target in mind will help you understand what is truly attainable and what is likely to cause you to fail.  In addition, if you are saving for known upcoming expenses, you can figure out exactly how much you need to save to reach the required amount by your deadline.

Understand your spending

The only way to evaluate how well – or poorly – you are handling your finances is to understand how you’re spending your income, what you’re spending it on, and how much you are saving.  Track all your spending for a month to understand exactly where you paycheck is going – and if you are spending more than you earn.

Set a budget

Once you know how you have been spending your money, you can define a budget based on your spending habits and savings targets.  At a bare minimum, you should know your fixed expenses (mortgage or rent, car payment, utility bill, cell phone, etc.), along with how much you want to put towards your new goals.  This will allow you to define how much discretionary spending power you have for eating out, going to movies, etc.  Remember, you can always be flexible within your monthly budgets.  For instance, if you want to see two new movies, but have only allocated for one, you might look to spend less on dinners out for balance.

Eliminate bad habits

Take a look at your monthly activity and identify the things you do that could be costing you more than necessary.  Are you paying full price for clothing?  Are you eating out several times a week?  Are you buying expensive Pay-per-View events every month?  Are often late with your bill payments?  There are many poor financial habits that could be costing you more than you realize.  Take a look at these and look for ways to eliminate or at least reduce them.

Elevate good habits

There are many ways to reduce spending simply by using the tools available to you – most of them on your mobile devices, which you take everywhere.  Loyalty programs offer member savings and allow you to collect points towards various purchases.  Find retailers you like and try to stick with them.  Don’t underestimate the power of coupons and sales – there’s no reason to spend more on something than you need to.  This may also mean learning to be flexible with what you buy and when. One of the many Online Services the Milford Bank provides is the ability to create bill reminders to allow you to set preferences for receiving e-mail notifications reminding you that your bill has arrived and/or your bill needs to be paid. This tool enables you to control the entire bill payment life cycle. The Bank has also recently partnered up with Plinqit, a simple savings tool that allows you to set up and customize your savings goal and have Plinqit help you set aside a small amount of money regularly, on a schedule you choose. You can also earn money with Plinqit by watching videos and reading educational articles to learn more about money and saving.

There’s no simple answer for saving money.  It all comes down to what your priorities are.  As you evaluate your own priorities, if you need advice on how to save or where to put the money you’re saving, consult your bank’s financial advisors, who can help determine the best kids of accounts for  your specific needs.  Then, it’s all up to you.

What you need to know about using P2P payment apps

By Lynn Viesti Berube

One of the unique features about today’s app-centric society is there’s an app or just about everything, it seems.  It’s great to be able to download apps and take care of so many things on your mobile devices.   On the other hand, because these apps tend to be fairly targeted – most try to solve a single problem – they don’t always offer quite the level of flexibility or functionality users might want.

Take mobile payment apps, for instance, like Zelle or Venmo, which are becoming increasingly popular.  They are designed to make exchanging funds between individuals easier using digital technology.  But, they are not necessarily intended for all transactions.  Both companies have been clear that their intended use is for payments between friends or other people who know and trust one another.  For things like paying a share of a dinner bill, sending an entry fee for a fantasy sports league, or getting in on a group birthday gift, apps like these make transactions fast and simple.  These are cases where one individual outlays funds for an activity, and others need to pay their share.

But, as with any digital transactions, there are risks that users should be aware of.  Here are a few simple tips to keep your apps, accounts, and money safe while letting you enjoy the convenience of P2P payment apps.

Intended uses – Use the apps as they are intended.  If an online retailer asks you to pay using a p2P app, you should be suspicious.  Reputable online retailers should offer payment methods that don’t require immediate P2P transfers, such as credit cards, PayPal, and other means.  If you’re paying for services, such as a snowplow service in the winter, using a P2P app, you may be using local residents not set up to receive credit card payments, and sending a check each time it snows can be a nuisance, so a P2P app might be the best option.  At the very least, make sure you know who you’re paying, use only reputable providers, and make sure you’ve received the service before paying.  Consider sending a check the first few times to make sure the relationship works out.

Identity – It’s easy to make a mistake when typing an email, phone, number or username.  Double check whatever identifier you’re using to send money to someone.  Once the money has been sent, it’s hard – often impossible – to get it back, so taking the extra time to get it right can reduce potential headaches.

Send a test – If you’re not certain you are sending to the right person, send a small amount as a test and confirm they received it before sending the full amount.

Security – Follow the same security principles as you would for any other application or website.  Use the highest level of security they offer, including using a PIN or fingerprint ID for transactions.  If the application offers two-factor authentication, be sure to use it.  While this adds an additional step when using the app, it also adds an additional layer of protection that help keep you account secure, even if your credentials are compromised.

Deposits – Some apps place funds you’ve received into a mobile wallet until you manually transfer them into your bank account.  This can sometimes take several days to process, so once you have approved the transfer, check to verify that it actually went through.

Fees – Some P2P payment platforms charge fees for certain kinds of transactions.  Make sure you know what your app’s policies and fees are so you won’t be surprised and can account for fees when sending or receiving money.

Settings – Always check your app’s privacy and sharing settings.  They may have default settings that make information available to others that want kept private.

Kids – Many parents want to give their children access to P2P payment apps to make it easier for them to participate in various activities.  You probably don’t want to give them full access to your credit card or bank accounts, so take the trip to your local bank to see what options they might be able to offer, such as a prepaid debit card to link to your child’s app.  If they are part of one of the payment platform networks, they likely are well versed on the best ways to let your kids use them.  Of course, before anything, make sure your child’s device has security protocols enabled, and talk to them about potential security risks and how to avoid them.


Peer 2 Peer Payment Apps Give Consumers More Choice

By Celeste Lohrenz

As it has been with nearly every industry, digital technology is changing the way people bank.  Online tools and mobile apps are making it easier for people to manage their finances, giving them modern options to replace traditional options.  P2P (Peer To Peer) payment apps, for instance, have become highly popular as a means of exchanging funds between individuals.

While check payments are still very popular – even with Millennials, new P2P payment users are nearly evenly split between those younger than and older than 45.

It’s really about having options.  If there one thing a digital economy has proven  it is that people want convenience.  They want to be able to transact using whatever methods are most convenient for them at the time.  That may mean going to a local bank office to understand the differences between home equity loans and HELOCs.  It may mean putting a check in the mail for a monthly car payment.  It may mean going to an ATM to take out cash for dinner.  It may mean putting a new TV on a store credit account because of a no-interest offer.  Increasingly, though, it also means using P2P apps to settle with friends, relatives, colleagues, or others.

For instance, Zelle – a mobile payment platform whose parent company is actually owned by seven major banks – delivered $49 billion through 196 million transactions in Q3 2019 alone, a year-over-year increase of 58% in transaction value and 73% in transaction volume. The Milford Bank is happy to now offer Zelle to our customers as a further option to your banking experience.

There are many reasons P2P payment apps such as Zelle are growing, but convenience is at the top of the list. Zelle offers a simple alternative to get money to other users quickly – if both parties are signed up with Zelle for instance, funds may be available within minutes.  Zelle is available on both Android and iOS platforms, making it easy to transfer money to split a dinner tab or utility bill, regardless of what mobile devices your friends use.

But, perhaps the biggest benefit Zelle offers is trust.  The biggest reason consumers avoid mobile payment apps is lack of trust.  In addition to being operated by a consortium of the biggest banks in the country, Zelle partners with other financial institutions so those banks can make Zelle transactions available through their own mobile apps and online resources – as opposed to having to use a third-party app.  Sending or requesting money is as simple as logging into The Milford Bank’s mobile app or online account and choosing the person to send funds to using your mobile contact list or entering their phone number or email address.

Along with The Milford Bank, more than 600 financial institutions have signed up to be part of the Zelle Network, with more than 250 already online and processing transactions.  In all, more users representing more than 5,500 banks have successfully completed Zelle transactions.

How are You Getting Rid of Your Old iPhones and Computers?

By Dave Wall

Every time Apple, Samsung, or any other electronic device manufacturer releases new products, the media tends to grab hold and saturate news feeds with the incredible advances these new product bring for consumer and business users. They’re not wrong of course – think about all the things we’re now able to do from smartphone in our hands.  It’s an unprecedented level of convenience, efficiency, and productivity, and the hype helps generate sales momentum as these new products become available.

But, what is left out is what to do with your old devices when you replace them. Of course, some phones are recycled when they are exchanged for new ones at mobile carriers like Verizon and AT&T.  But when you consider the third-party market for not only phones, but other devices like tablets, laptops, smart watches, and the many other products that permeate today’s digital lifestyles, it’s clear that there’s an awful lot of electronic waste being created.

The United States alone generated almost 12 million tons of e-waste in 2014 according to the EPA. The UN reported that 44.7 million tons of e-waste was generated globally in 2016, and the World Economic Forum reported that number had risen for 485 million tons in 2018.  That makes it the fastest-growing waste stream in the world.  Yet, only about 20% was recycled.  So, where do the rest of these items end up?  Certainly, many are likely collecting dust in homes and offices, but a large percentage ends up in landfills or incinerators, both of which are harmful to the environment.

E-recycling offers an effective way to get rid of old electronics safely, but how should you recycle your electronics? There are many local retailers that will recycle e-waste – some of them regardless of where they were purchased.  And of course, mobile carriers often offer rebates for trade-in that can be applied towards the purchase of a new device.

If you keep an eye on your community events, you will also likely find e-recycling opportunities. The Milford Bank, for instance, will be holding two Shred & Recycle Days this year, making it easy for residents to get rid of their old electronics, as well as paper documents.

The first TMB Shred & Recycle Day will take place on Saturday, May 4, 2019, from 10:00am-1:00pm at the Post Road West branch (295 Boston Post Road, Milford, CT), and will include free e-recycling for anyone and free document shredding for customers (non-customers may still take advantage of the shredding service for a $5 donation to a local non-profit).

The second Shred & Recycle day will take place in the fall, after families have purchased new laptops and tablets for the new school year, on Saturday, October 12, 2019 (10am-12pm).

Recycling electronics and paper provides a constant stream of resources that have countless uses, helps reduce the amount of junk that piles up in landfills across the globe, and reduces the environmental impact of dumping. There are many materials that can be harvested from old electronics that can be re-used to manufacture new ones, including, gold, silver, palladium, and copper.  The WEF values the value of materials that can be recovered through e-recycling at more than $62 billion.  Apple says it was able to collect more than a ton of gold from recycled devices in 2015.  That’s worth more than $40 million.

Take a look around your home. If you have old electronics lying around that haven’t been used for years – and most households do – take advantage of this community service provided by The Milford Bank to do some good for the environment and get rid of some old junk from your home in the process.


Identity Theft vs. Identity Fraud: What You Need to Know

By Tyler Haskell

Identity theft and identity fraud are becoming all too common today, with the economic impact to banks, businesses, and customers reaching well into the billions annually. In 2018, roughly 14.4 million American adults were victims of identity fraud, with losses totaling $14.7 billion. The two terms – identity theft and identity fraud – are closely related, but aren’t the same, despite often being used interchangeably.

Identity Theft
Identity theft takes place when criminals acquire personal data, which is then used for subsequent illegal activities, including identity fraud and the sale of information to others. This information can include any number of PII (Personally Identifiable Information) data, such as social security numbers, credit card numbers, bank accounts, driver’s license numbers, passwords, and more.

There are many ways criminals can steal personal data, from advanced hacking techniques to intricate scams to burglary and dumpster searches. Corporate hacking instances have increased over the past years, with many high-profile breaches being featured in mainstream news, from retail stores to healthcare organizations. The breaches have resulted in millions of customers’ data being stolen. Mobile devices are also a high-value target, simply because of the incredible amount of data stored on them.

Identity Fraud
Identity Fraud happens when criminals use stolen personal data for illegitimate transactions. These may include fraudulent purchases, opening new bank accounts or credit cards, initiating loans, and more.

Identity fraud impacts not only the victims of identity theft, but also the other organizations that become part of the fraudulent activity: merchants, banks, credit card companies, etc. The truth is, everyone is impacted in some way because businesses build the cost of fraud into their pricing structures to help cover their losses.

Protecting Yourself
Recovering from identity fraud is a daunting task that can take 200-300 hours of time and cost $1,000 or more. What’s more, these accounts can appear on credit reports for extended periods, making it difficult for victims to get legitimate credit.

First and foremost, protect your data. Don’t share passwords or account information. Don’t lend your credit cards or IDs to others. Make sure you have high levels of security on your mobile devices and use highly secure passwords on your online accounts – and don’t reuse passwords. Also use two-factor authentication whenever possible.

Be aware of the countless scams being conducted via phone and online. If you even remotely question a request for information or an offer, hang up and call the institution back yourself to verify the request. Legitimate organizations don’t usually ask for sensitive information without you having contacted them first.

Be sure to check your credit report regularly. We can assist our account holders with this by activating Credit Sense on your online and mobile banking app. Credit Sense is a tool that will help you improve your financial well-being. Credit Sense gives you up-to-date personal credit information including credit scores, credit usage, total balances, payment history, credit age and recent credit. You can refresh your credit score as often as you need and get tips on how to improve it. Credit Sense also offers credit monitoring, which gives you protection from fraud with alerts notifying you when something has changed in your credit profile.

While it’s hard to keep your data completely safe, following these simple precautions and staying alert can help you avoid the hassles and financial burden of identity theft and fraud. To help you with best practices for avoiding identity theft, contact us to learn how we are helping protect your identity and funds.

Sensible Saving: Financial Tips for Recent Graduates

By Cortney Meng

With the end of another school, a new class of college graduates is entering the workforce.  Regardless of where their career paths may take them, they share one constant – they will need to support their chosen lifestyles.  It also means starting to prepare for the future, which is likely to include major expenses like home and automobile purchases, raising families of their own, funding children’s college educations and weddings, and even planning for retirement.  It’s never too early to start planning for the future – even those students who are still in school.

With the pressures of school, and then finding a job upon graduating, it’s easy to ignore the need for financial responsibility – especially when parents have been footing the bill.  Making the transition to the workforce even more challenging for some 44 million Americans is the need to repay student loans.  In fact, the Financial Literacy and Education Commission – which including the Treasury Department and Department of Education – recently release a report stating that the current $1.5 trillion student-loan debt is a clear indication that students need better financial education as they head into the workforce.

Indeed, some schools are already teaching basic financial skills within their curricula, but there are a number of basic tips for recent graduates, and all younger members of the workforce, that can help ensure they are setting out on the right path towards financial stability.

Start saving today

Too many young adults enter the workforce with nearly nothing saved, creating challenges when it comes to living on their own and funding necessary expenses – like rent, food, cell phone bills, Internet services, and more.  Having nothing saved also makes it harder to accommodate larger expenses that are certain to arise.  Not having anything in savings also makes it very easy to build up high credit card debt, which can end up costing hundreds or even thousands of dollars each year in interest and negatively impact credit ratings.

Keep track of spending

This is something that really applies to everyone, but younger earners may not be aware of how important it is to be able to account for spending and how that knowledge can impact their ability to save.  For a tech savvy generation, there are many apps available to help track spending.  Some are standalone apps, while others can be linked to bank accounts for even more precise accounting.  The bottom line is that, in order to save, you first have to know how you’re spending your income, and how much of it is necessary spending and how much is discretionary that you might be able to reduce.  Once you know that, you’ll be able to start adding to your savings.

Pay bills on time

If you’ve never had to handle your own bills, it can be a daunting task at first.  But, it’s important that you keep up with your bills.  By paying them on time, you are able to better understand your monthly spending habits and your financial stability.  Setting up automatic payments is an easy way to make sure your regular recurring bills are always paid on time.  But, it also means you have to be diligent about tracking your expenses and making sure you aren’t overspending.  Also make sure you balance your checkbook every month.  It’s easy to fall behind on payments, but once it happens, it’s even harder to get back on track, and you also have to deal with late fees and interest, which reduce your ability to save.

Student loans

For some 44 million Americans, graduation also means the start of a six-month grace period before they have to start paying back student loans.  Averaging almost $30,000 per graduate, student debt has become the second largest source of consumer debt, behind only mortgages.  The key is simple:  start paying off your student load(s) as soon as possible.  You may need to use the grace period to add a little to your savings, but be sure to factor loan payments into your monthly budget.  If you’re able to pay more than the minimum payment each month, you may not be able to save quite as much immediately, but you’ll be able to eliminate that debt faster.  Remember, student loans don’t disappear and will damage your credit rating if you are regularly late or default on your loan(s).  If you have multiple student loans and are only able to make bigger payments towards one, make sure you pay off the higher interest loan first.

Build your credit

Staying current with bills, reducing and paying off loans helps increase your credit worthiness and makes it easier to get lower interest rate loans in the future.  While credit cards are useful, limit how many you have – it will help you manage spending better and avoid getting into more debt.  However, there are ways to use multiple credit cards to your advantage, such as using low or zero-percent balance transfer offers to pay off higher interest rate debt (including student loans) – just make sure you are able to pay off the amount of the transfer within the introductory period without impacting your ability to pay other bills.  Also look for credit card offers with the best benefits.  Many issuers today offer points or cash back on purchases, airline miles, or other benefits.  Look for benefits that make most sense for you, and try to find ones without annual fees.

Rainy day fund

It’s always good to have an emergency fund.  After all, you never know what necessary expenses might arise, or what non-essential spending you may want to be able to afford, including vacations.  You also want to be prepared in case you are suddenly out of a job so you are able to continue paying your bills and won’t risk impacting your credit rating.  A good target is to have 6-12 months of expenses saved up.

Monitor your credit

Considering the growth of cyber crime and the rate at which consumers’ personal, financial, and other information is stolen, it’s a good idea to regularly monitor your credit report. The Milford Bank offers CreditSense, a financial tool that will help you improve your financial well-being.  The FTC also has mandated that everyone is entitled to one free copy of their credit report every 12 months from each of the three nationwide credit reporting agencies.  Using just this as a resource, you can check your credit report every four months at no cost.

Maximize your 401k investments

It’s never too soon to start saving for retirement.  If your employer offers a 401k plan with an employer match, it’s smart to contribute at least much as the maximum match, if possible.  That way, you are not only putting your own money towards your retirement, but are taking full advantage of your employer’s matching contributions.  If your budget allows you to contribute even more, that’s never a bad option.  You can always adjust your contributions if circumstances change.

Create a reasonable budget

The key to successful financial management is creating a sustainable budget that makes sense for your needs.  Take a look at your spending – including what are necessary expenses (rent, loans, utilities, etc.) and what you may be able to cut back on (such as eating out vs. cooking at home) – and create a budget that will allow you to accomplish your goals.  You may have to take a hard look at your discretionary spending in order to fit some expenses into your budget initially, such as student loans.  But, as you pay off existing debt and your income increases with work experience, you’ll be able to adjust your budget and save more.  Don’t set a budget that won’t work for you – and certainly not one that will increase your debt.

Don’t let a lack of information or inexperience put you on the wrong track financially.  If you aren’t sure how to effectively manage your finances or are looking for advice on creating a financial strategy that will help you achieve your short-term objectives while moving towards longer-term goals, contact a financial advisor.  They have extensive expertise in helping recent grads – and anyone looking for financial advice – cope with the inevitable challenges of entering the professional life.


7 Things to Consider with Home Equity Loans

By Paul Mulligan, Senior Vice President

There are many situations homeowners may require an influx of cash. If they’ve built up equity in their homes (if the home is worth more than what they owe on it) a home equity loan may be an attractive option. While a home equity loan may seem like a great idea, depending on how you plan on using the cash could determine whether it’s the best option for your needs.  Here are several things to consider if you’re thinking about taking out a home equity loan.

Understand the risk – With a home equity loan, you’re putting your home up as collateral. This means that, if you default on the loan, your lender can take your home to satisfy the debt.  For instance, taking out a home equity loan to pay off unsecured debt, like high-interest credit cards, may seem like a good idea – and it may be, if you’re able to make your payments.  But, if something happens and you’re unable to satisfy your loan terms, you may end up in a worse situation than just having credit card debt.

Repayment strategy – Make sure you have a reasonable repayment plan in place.  If you’re planning on using variable cash flows – like raises, commissions, or bonuses – make sure you have a backup plan in case your cash influx is smaller than expected.  It may help to create a detailed table with monthly income and expenses, including discretionary spending that might need to be limited in order to be able to pay off a loan.

Total loan cost – Always make sure you are fully aware of the total cost of your loan, including interest payments, closing costs, loan insurance, prepayment or other penalties, variable payments or interest rates, and any other hidden fees or costs that might impact your total loan cost or your ability to pay it off.  Knowing how much the loan will cost you will impact your decisions.

Tax implications ­– One of the benefits of home equity loans is their status as tax deductable interest.  But, the Tax Cut and Jobs Act of 2017 applies new restrictions to when home equity loan interest can be claimed as a deduction.  More specifically, under the new regulations, interest on loans used to significantly purchase, build, or renovate a home may be tax deductible, whereas non-property-related uses of loans are not. (Contact your tax advisor for specifics.)

Plan ahead – Regardless of what you’re planning on using your home’s equity to fund, give yourself plenty of time.  While good candidates may have a fairly easy time getting a home equity loan, it’s not as simple as pulling up to an ATM and withdrawing cash.  While emergency situations may arise, give yourself as much time as possible to get a loan approved.  Lenders will run credit checks and may require home appraisals, creating a delay between your initial loan application and when funds are made available to you.

Consider your optionsTechnically, borrowers may use the funds for whatever they need them for, but it’s worth considering all the options depending on your needs.  Home improvements tend to be looked at as a high-value loan because you’re actually increasing what your home is worth.  Many people look at home equity loans as a way of paying for their children’s college tuitions, new vehicles, medical bills, consolidating debt, or other expenses.  Consider your options for any of your needs; your bank might have different loan products that are better suited for different needs.

Regardless of your needs, make sure you consult a loan specialist before making a decision that will impact your finances and life for years to come. The Milford Bank has consultants ready to answer your questions and discuss the best loan options for your unique financial needs.




Home Equity Loan vs. HELOC – Which One is Right for You?

By Paul Mulligan, Senior Vice President

One of the benefits of owning a home is the ability to use built up equity to finance other cash needs with a Home Equity Loan or a HELOC. Some of these uses carry more value than others – and some carry more risk.  Because of that, potential borrowers should do their due diligence and consider all aspects of these loan products before making a decision to put up their homes as collateral. Click HERE for 7 Things to Consider with Home Equity Loans.

That includes understanding different loan alternatives and how they may benefit your needs for cash, like the difference between a home equity loan and a home equity line of credit (HELOC). While they are similar and both use the home as collateral, they are designed differently and can end up with different total cost of loan figures.

Home Equity Loan

A home equity loan provides borrowers a single, lump sum of cash that must be paid back over a specified period of time at an agreed interest rate. It’s similar to a first mortgage in that payments are a known constant and go towards both interest and principal.  With home equity loans, you are paying off the full amount of the loan plus interest.

Home Equity Line of Credit (HELOC)

A HELOC is a revolving line of credit with a predetermined limit. Think of a HELOC almost like a home equity credit card that gives borrowers access to a cash reserve they can draw upon for whatever needs they may have.  The line of credit remains active for a specified period – up to 10 years, depending on the lender.  While the line of credit remains open, borrowers pay back interest; once the draw period is over, payments typically increase and include both interest (only on the amount withdrawn) and principal (the amount withdrawn) payments.

Lenders may offer customers different options for accessing funds, and they may have minimum withdrawal amount policies or require a minimum outstanding balance. Make sure you are aware of all details of your loan before signing the paperwork.

Which is better?

This is a question each borrower has to answer based on his or her circumstances.  Home equity loans tend to be useful for large projects – like home remodels – that require a large payment at one time, or for situations where the amount to be borrowed is known.

HELOCs are good options for borrowers who need access to smaller amounts of cash over a period of time – such as for a number of smaller projects over the course of several years, or when the total amount required may not be known.

Interest Rates

Home equity loans typically have fixed rates, which means payments will be the same for the duration of the repayment period. HELOCs usually are variable rate loans based on Prime Rate or some other standard index plus a margin.  HELOCs may come with a lower introductory rate that increases – along with monthly payments – once the introductory period expires. Check with your lender for current rates.

Closing costs

Both HELOCs and home equity loans typically include closing costs that may also include additional fees for appraisals, insurance, loan processing, attorney fees, and more. Be sure to ask your financial specialist what fees you can expect with either type of loan and whether any additional fees may apply under certain conditions, such as early repayment, or with each withdrawal from a HELOC.

The bottom line is that both home equity loans and HELOCs allow homeowners to tap into the equity in their homes to finance other needs. What those needs are and whether either of these two is a good option is something a loan expert at your financial institution can help determine.  Regardless of what option you choose, be sure to shop your loan needs around to get the best terms, but be sure to ask as many questions as possible to determine the total cost to you over the loan period.  Also make sure repaying the loan doesn’t exceed your monthly budget.  If you are unable to pay back the loan, you’ll be putting your home at risk.  But, with the right planning and advice from a financial expert, home equity loans and HELOCs are both great options for taking advantage of the equity you’ve built up in your home.

If you’re considering a second mortgage, The Milford Bank has several loan products that may be ideally suited to your needs. Contact our loan experts today to discuss your specific needs and make sure you have all the information you need to make an informed decision.

Five Financial Challenges to Test Your Saving Skills

By Tina Mason

One of the best ways to invigorate your saving strategy is by issuing yourself a challenge. Not only does the competition make it a little more fun, but you’ll also learn valuable lessons about the long-term benefits of discipline, the way your daily spending habits impact your quality of life, and just how much you can accomplish when you set your mind to it.

If you’re looking to make improvements to your financial planning and add a little extra padding to your savings account, here are five financial challenges you can try.

Take a new look at a favorite vice: There’s nothing wrong with splurging every now and then. But if you’re spending $5.00 on a cup of coffee every day, you may want to take a fresh look at how you get your morning pick-me-up. Could you live with making coffee at home and saving yourself over $1,000 a year?

Dive into the gig economy: If you find yourself with lots of free time and aren’t sure what to do with it, challenge yourself to finding a part-time gig. If you love nothing more than driving around town listening to music, maybe Uber would be a good fit. Fancy yourself a writer? Try to get published as a freelancer. There are tons of opportunities that will fit where, and how, you need them to.

Live like you’re single: Remember when you were young and single? You could somehow survive in an apartment the size of your living room. You ate Ramen noodles for breakfast. And even if you had less money saved up, you may have felt more financially free. Granted, your spouse may not appreciate Ramen the way your 20-year old self did. However, we all behave differently when we engage with others. By focusing solely on your own finances for a brief stint, you may be able to indicate where you’re letting money fall through the cracks.

A dollar a day: This one’s simple. Get a jar, and add a dollar to it every day. If you’ve got something you’re saving for, simply wait until you’ve gotten there. If not, consider it a rainy day fund for an emergency. You’d be surprised how easy it is to forget about a dollar every day.

Pile up your perks: Perks are everywhere these days. Debit and credit cards will often offer discounts, deals or cashback. Some people go coupon crazy at the grocery store. In this challenge, you are tasked with taking cash equal in value to the perks you’ve accumulated and putting it into a new savings account. It is a way of making your savings seem tangible, and will always help to remind you  to look for savings in your day to day life.

At The Milford Bank, we’re always looking for great ways to help you grow your wealth, protect your family and live your best life. To learn more ways to save, stop by any office location in Milford or Stratford or check out our Online Learning Center here.


With Winter Over, Now is the Time to Get Ready for… Yep, Winter

By Matt Kelly

Having been blasted with several Nor’easters in recent weeks, you may be ready to put down the snow blower and forget about the winter blues for a few months. But before you start compiling your Spring cleaning list, we implore you to think about Winter just a while longer.

As you’re well aware, the inclement wintery weather isn’t just an inconvenience. It’s an added expense. But with a little early planning, you can ensure that next Winter doesn’t break the bank. You never know, maybe you’ll even have a little extra holiday shopping money!

Here are some of the key considerations you should make now, before Winter escapes your mind like a receding tide on a tropical beachfront.

  • Lock in rates with your energy supplier. You’ll typically pay a much higher price for heating when demand is up and supply is down. This typically occurs in late Fall and throughout the Winter. You will likely be able to find optimal rates before the Summer heat hits. Fix your rate now and you’ll be assured of a consistent and affordable price all Winter.
  • Take advantage of seasonal sales. Besides fuel, there are plenty of other items you need throughout the Winter. If you’re a skier or snowboarder, you’ll likely find all your gear at reduced prices at this point in the season. Maybe you simply need new winter jackets. Whatever your need, businesses are eagerly letting go of their inventory while they can.
  • Not all firewood is created equal. Stoking a fire isn’t just for show in Winter time. It can be a necessity if the power goes out in a storm. It can also support your basic heating needs to reduce reliance on other fuels. However, it’s important to shop your prices and also the type of wood. Some types are not meant to burn indoors, and all wood should be properly seasoned. Otherwise, you may not get full efficiency from your wood.
  • Weatherize before the rush. The elements are constantly doing battle with your home. Weatherization can help you to keep up energy efficiency. There are plenty of businesses in the Milford and Stratford communities that offer energy audits that can help you find and fix inefficiencies.
  • Keep up with routine maintenance. By keeping up on routine maintenance now, you can save yourself tons down the road. After a particularly icy Winter, it’s important to make sure ice hasn’t dammed on your roof or in your gutters. Seal cracks in your driveway to prevent further damage to the concrete, and take good care of all the mechanical components in your home.


I’m sure the last thing you want right now is someone reminding you that you need to prepare for Winter. We’re ready for beaches and barbeques, too! But a little foresight can go a long way, especially when it comes to the Winter. To learn more about managing your finances, check out our Online Learning Center or stop by any office of The Milford Bank in Milford or Stratford today.