Three Ways You Can Improve Your Credit Score

/in , , , , , , , /by

By Paul Mulligan

The importance of having good credit cannot be overstated. Having a good credit score—at least 700 on a scale from 300 to 850—can open up a world of possibilities that might otherwise have been unavailable to you. Good credit can help you get approved for a car loan or mortgage. In some cases, employers and landlords will even use credit scores as part of their background checks. A good credit score may also help you qualify for financing and credit cards with lower interest rates.

In general, you’ll find managing your finances and improving your quality of life easier with a first-rate credit score. On the other hand, the lower your credit score drops, the harder time you’ll have qualifying for low interest rates that will help you cut into your debt.

Fortunately, you can establish a good credit score early on and keep it headed in the right direction by following these three steps.

  • Apply for a secured credit card. Building credit is difficult to do without an existing payment history. One of the quickest ways to establish your ability and willingness to pay off debts in a timely manner is by using a credit card. Yet, first you have to qualify for the card, which is also contingent upon a solid history of loan repayment. In this case, a good solution is to procure a secured credit card. The lender assumes no risk with this alternative, as a sum of money equivalent to the total available balance on the card is held in an account and only released after you’ve established a track record for making regular payments.
  • Pay more than the minimum on your credit card(s). Another way to prove that you’re a low-risk customer is to pay down more than the monthly minimum on any of your existing balances. You don’t need to go overboard; paying 10 extra dollars a month can have an impact.
  • Leave repaid debts on your credit history. There is a difference between good and bad debt. If you’ve paid off a loan, don’t make the mistake of trying to erase the evidence that you had debt from your credit score. The fact that you incurred debt and handled it responsibly will help your score.

To learn more about the importance of credit and what you can do to improve your standing, stop by Milford Bank to speak with one of our financial advisors, or check out our Online Learning Center by clicking here.

Don’t Miss Our Website’s Hidden Treasures

/in , , , , , /by

by Lynn Viesti Berube

If you’ve stopped by one of our office locations and spoken with one of our experienced and friendly employees, you already know about the superior financial services The Milford Bank can provide to help you make the most out of your money. But did you know that there are a variety of resources located on our website for your convenience as well?

In the interest of helping you get the best education possible, we’ve filled our website with financial resources that you can access conveniently anywhere you go. From programs to teach your children about savings, guides to teach you about saving for retirement and everything in between, your Milford Bank experience isn’t complete without checking out all our website has to offer.

In case you’ve missed them, here are some of the hidden treasures placed on our website to help you and your family make smart financial decisions.

Cent$ible Kid$: Teaching your children about the value of saving money can be difficult. That’s why we created the Cent$ible Kid$ program. Your kids can learn how to manage and reinvest their savings with three interactive games right on our site. The program also comes complete with a child-friendly quarterly newsletter full of advice for your kids. As a Cent$ible Kid$ program member, you and your children will also qualify for incentives and special offers from Milford Bank. You can check out the Cent$ible Kid$ program here.

Learning Center: If you’ve got a financial question you need answered but it’s after hours, head to the learning center. You can find answers to your questions easily, whether it’s as simple as explaining how savings bonds work or as complex as planning your estate. There are a dozen unique sections in the learning center that cover a wide variety of topics, each complete with its own downloadable guide. You can reach the Learning Center by clicking here.

Financial Calculators: Are you curious about buying a house and want to quickly figure out the price difference between a 15 and 30 year mortgage? Are you trying to determine whether or not to consolidate your debt? Do you want to know how long it would take you to become a millionaire with your current saving strategy? You can use our financial calculators to get a quick answer to these questions and many more by simply clicking here. Using financial calculators can help provide context to the financial decisions in your life that seem too large to wrap your head around and give you a clear directive on how best to proceed.

At The Milford Bank we want you to have an unforgettable and informative experience with us, whether you’re depositing a check with one of our tellers or skimming over our website on a mobile device from the comfort of home. That’s why we’ve populated our website with these features. But there are even more hidden treasures than those mentioned above. Check out our page here and see what else you can find!

Lifestyles of the Broke and Famous

/in , , , , , /by

by Mark Attanasio

Many people look to celebrities as an embodiment of the American Dream. Whether it’s an athlete inking a $100 million contract, a musician reaping the rewards of a platinum album or an actor raking in gold from an appearance on the silver screen, the rest of us see these individuals as the lucky ones that hit it big.

While it might seem like they’ll never have to worry about money again, the truth is that many celebrities end up in the same dire financial straits as the rest of us. Financial success isn’t only about how much money you’re bringing in, but rather how well you manage your assets, control your spending and avoid risky and potentially costly life choices.

Here are several high-profile names and their stories to serve as a reminder of the fact that financial success has less to do with your paycheck than you might think.

Nicolas Cage: Between 1996 and 2011, Cage banked over $150 million from his prolific acting career. He proceeded to spend it all on a lavish lifestyle revolving around sports cars, exotic pets, a rare collection of dinosaur fossils and private islands in the Caribbean. By the time the IRS came calling for its share—$13 million—the money was gone.

Reality check: It doesn’t matter how much you earn if you don’t put any money away for a rainy day.

Fred and Jeff Wilpon: The Wilpon brothers, majority owners of the New York Mets baseball team, became protagonists in a financial cautionary tale in 2008 when news broke that their fortune was ensnared in the ponzi scheme orchestrated by investment advisor Bernie Madoff. The Madoff case was discovered to be the largest financial fraud case in U.S. history and cost the Wilpon family between $500-700 million. They nearly had to sell their beloved franchise, but were eventually able to deal with their reversal of fortune.

Reality check: Even if you have entrusted the management of your finances to a professional, stay involved and know how your funds are being handled. Nobody, not even an advisor, will be more concerned about your bottom line than you are.

Willie Nelson: This legendary country music singer is perhaps as famous for his run-ins with the law as he is for his boisterous stage presence. Despite his commercial success, Nelson ran into tough times over the course of his career thanks to unpaid tax bills and a series of drug-related offenses that have cost him mightily over the years.

Reality check: Crime doesn’t pay. If you party like a rock star, you may end up broke as your life savings end up in the pockets of lawyers.

At The Milford Bank, our goal is to help you make the smart decisions with your money. Stop by any of our offices to learn more about protecting your wealth.

What is the ROI of a College Degree?

/in , , , , , , /by

by Lynn Viesti Berube

Attention high school grads: are you heading off to college in the fall but not quite sure what you want to study?

You are not alone.

According to recent statistics, as many as 80 percent of college freshman walk onto campus for the first time without having chosen a major. Moreover, upwards of 50 percent of those who do choose a major early end up switching majors at some point—often two, three, or even four times!

This article will give you several of the most rewarding majors in terms of return on investment (ROI), in order to help guide you in a smart direction financially, and can also show you what you can do with each degree. After all, college is expensive—why not make the most of it!

Without further ado, here are five of the best majors to consider in terms of ROI:

  • Economics

Pardon the bad pun, but economics majors really are getting an “economic” college education. The ROI of an economics degree from a public university is 182 percent—the highest on this list!  In terms of actual jobs and salaries, the median income for a corporate economist is over $115,000, while the average salary for an investment operations manager is nearly $143,000. Economics majors may see sustained job growth in this sector going forward.

  • Information Technology

Few industries are growing at a faster rate than IT, and that trend should continue through at least the next decade as mobile networks continue to expand, and healthcare IT becomes more prevalent. IT majors possess a skill-set that can be utilized in many facets of business.  The ROI for IT majors can range anywhere from 126 percent for web application developers (a position with incredible demand), to 169 percent for IT managers.

  • Math

According to the Occupational Outlook Handbook, math majors may have a tremendous number of opportunities available to them once they graduate. Math occupations are expected to grow by 28 percent over the next decade, and any position that requires complex computation likely requires a math major. From accounts payable/receivable managers to actuaries, many math majors earn well over 100 percent ROI with their degree.

  • Engineering

The last two majors on this list comprise the fastest growing set of majors across college campuses. Over the last five years, science and engineering degrees grew by over 19 percent (compared to 9 percent among other majors). The world simply needs more engineers, whether it’s electrical engineers (median salary of $92,000), civil engineers ($82,000) or chemical engineers ($76,000).

  • Biology

While behavioral science has seen a staggering 89 percent growth over the last five years to pace the sciences discipline, biology is the much better long term investment for students. The average salary for a behavioral science major is just $34,000—well below jobs that are available to those with a biology degree—such as health and safety supervisor ($72,000), clinical research associate ($72,000), and laboratory manager ($85,000). All three of those positions offer an ROI in excess of 100 percent.

For more advice on how to get the most out of your college education, stop by any office of The Milford Bank!

 

In Four Baby Steps, Help Your Children Establish Their Own Credit Histories

/in , , , , , , , /by

by Celeste Lohrenz

A sound credit history can help you obtain the best rates and terms when making purchases that lead to a more satisfying life (aka the American dream). Whether you’re trying to finance an automobile or a house, or even just rent an apartment, your credit score can be very important. And this situation is unlikely to change before your children reach adulthood. So, how can you help your kids establish credit histories that will support their future endeavors?

The path to a good credit standing starts with fiscal responsibility, and a great way to develop this in children is through exposure. That is, start building your child’s credit standing as early as possible. (Of course, all children mature at their own rate. Be sure they are able to handle responsible money management before helping them to establish credit.)

Here are some tips to establish credit histories for your children before the time comes when they step out into the world on their own:

1. Begin with a savings account: Because most banks will not allow you to open a checking account for your children until they are older, start with a savings account. You can open one for your child the day he or she is born or wait until the child matures to the point when such an event will have the most beneficial impact. Consider, for instance, whether or not he or she is earning money. Being an earner can be a good foundation for helping your child to understand the value of money. Putting aside some of their earnings could become a valued practice among children when you teach them what accumulated savings can buy.

2. Open a joint checking account: Once your child is older and a little more responsible, you can open a joint checking account. If you choose, both you and your child will be able to get a debit card for the account, and you will have the ability to monitor transactions. This gives your child a little more responsibility while still giving you oversight.

3. Obtain a credit card: The earliest age that your child can obtain a credit card is 18. If he or she has shown responsibility with their joint checking account prior to turning 18, then the child may be ready to move ahead. Many banks offer “secured” cards with a small line of credit while holding back a corresponding amount of cash in a linked savings account. This way, banks limit their liability and still enable individuals to start building credit by paying off the card according to set guidelines. You also may want to consider cards from retail stores like Target or Home Depot, as these are generally flexible and can help curb excessive spending because they are only good for purchases made in their stores.

4. Pay off a credit card: A good way to build credit is to show creditors that you don’t spend excessively, and that you consistently pay your bill on time. For this reason, impart to your child the importance of limiting spending to about 30 percent of the available credit limit and paying the balance off regularly each month. This is better than not using the card at all or maxing it out—even if it is paid in full regularly.

More doors will open later in life for your children when you help them build a sound credit history. To learn more about ways you can encourage your children to learn more about financial responsibility, click here to read our Cent$ible Kid$ newsletters.

Three Tools for Teaching Cent$ible Kid$ Personal Finance

/in , , , , , /by

by Becky Tudor

Americans today are having a difficult time saving money for the future. In fact, the independent research firm NextAdvisor recently found that nearly one in every four Americans has no savings at all. With recent history showing how unstable economies can become, parents today would be well-advised to educate their children about the importance of personal finance.

As of now, only 17 states have personal finance classes as a high school graduation requirement. If you live in one of the 33 states that doesn’t have this requirement (Connecticut is one of them) it might be wise to find other means of educating your children in this area.

Here are three tools the Milford Banks Cent$ible Kid$ Program employs to help teach your children personal finance:

1. Games: Yes, kids love games and, oftentimes, parents worry they might love them too much. But when games are educational, research shows it helps children learn. Computer games, like “Cash Puzzler” and “Road Trip in Savings” available through The Milford Bank’s program, entertain kids while teaching them lessons about money and spending.

2. Savings account: Cent$ible Kid$ operates by giving children their own savings accounts. Along with responsibility for this important personal finance tool comes a chance for these young owners to develop their own plan for savings.

3. Newsletter: Visual learning is important to children. Their young minds are receiving educational stimuli when they read our Cent$ible Kid$ newsletter. To get a taste of our children-friendly newsletters, that provides children with visual learning materials, check out the latest here.

Today’s Youth Grade Themselves ‘C’ or Below When It Comes to Managing Finances

/in , , , /by

by Cortney Meng

Despite the fact that today’s youth have grown up in the era of mobile banking, digital wallets and financial services platforms—from Venmo to Splitwise—a number of millennials feel ill-equipped to handle their finances. In fact, according to a survey of 1,640 college students, as part of U.S. Bank’s 2015 U.S. Bank Students and Personal Finance Study, 50 percent of coeds would give themselves a “C” or below when it comes to how successful they are in managing their money.

What’s more, the survey found that:
• More than 60 percent of college students have little to no knowledge of investments or retirement savings.
• Twenty-one percent of students are barely keeping up on day-to-day expenses, with only 5 percent prepared for unexpected expenses.
• Only 39 percent of students correctly know that paying off a delinquent loan or credit card balance is not enough to remove it from a credit report.

So how can today’s millennials start better preparing for their financial future? To begin, young adults can get a good handle on their current financial situation by asking themselves questions like:
• Am I currently in debt? If so, if I continue down the same payment rate, at what point will my debt be paid off?
• Do I have any major financial decisions ahead that I need to start prepping for today, e.g., buying a new car, saving for a house or merging accounts with a soon-to-be spouse?
• How am I currently saving for retirement? Have I started a 401k investment? Am I investing in stock? Do I have an IRA?

The answers to these questions can help guide them down a specific financial path. Youth who are in debt can begin to set budgets and reduce their lines of credit to make payments more expediently. What’s more, they can create a detailed document listing the interest rate, balance and minimum monthly payment of all their debts to stay on track of payments.

In addition, young adults may want to consider consulting with a reputable financial advisor, either formally or informally. For instance, a lot of banks can pair members with financial coaches and advisors who specialize in everything from wealth and asset management to retirement planning. Here at The Milford Bank, for instance, our resident expert John Kuehnle is always on hand to make recommendations and provide financial direction based on the information provided to him.

Millennials can also spend more time discussing their finances with their parents, especially since the survey found that 91 percent of students learn about money from their parents, either directly or by example. Moreover, 55 percent of students identified their parents as the No. 1 influence on their financial habits, as well as their go-to source for financial advice.

Are you a millennial just starting out on his or her career? Are you looking for additional financial resources? Be sure to check out our learning center, where you can pick up tips and tricks on everything from how to pay for college to how to employ basic investing strategies.