Are You Getting the Most From Your Digital Banking Tools?

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For the past two months, most of us have been working from home as our businesses have closed physical workspaces due to the COVID-19 pandemic.  It’s been a challenge for many, and we are hopeful that we can all start to get back to our offices and ease back into more normal environments soon.

Throughout this crisis, even though our lobbies have been closed, The Milford Bank has continued to provide the banking services you need through our drive-thru tellers, ATMs, and phones.  We also hope you’ve discovered the many digital banking services we offer.  They are not only helpful now, but offer a convenient way to manage your finances going forward – so you can spend more time doing the things you enjoy.

Through mobile apps for phones and tablets, as well as online banking via your browser, digital banking gives you access to most of the services you need on a regular basis.  One very important thing to always keep in mind is to only use your digital banking tools on secure networks – and never use public WiFi to access your accounts.

Online and mobile banking apps ­– With our online tools and mobile app, you have a powerful set of tools to make managing your finances easier than ever.  With them, most of your banking needs can be handled from anywhere and from most digital devices, including:

  • Access your accounts
  • Check balances and transactions
  • Get copies of checks
  • Review loan/mortgage information
  • Transfer funds between accounts
  • Make deposits
  • Pay bills, set up/stop automatic payments
  • Make P2P payments
  • Find the closest ATMs or offices

You can access online services from any browser, and the mobile app is available for iPhones, Android phones, iPads, Android tablets, and Amazon tablets.

Plinqit– Saving money is never easy, and today, it may be even harder for many.  Savings apps like Plinqit can help you set aside even small amounts of money regularly for emergencies, college tuitions, weddings, mortgages, new cars, or anything else you may need extra money for.  All you have to do is set up your account, connect it to your savings account, and set your savings goals and a savings schedule.  Automating your saving – even if it’s only a small amount each week or month – will help you work towards those larger purchases.

Zelle – Zelle is a convenient way to send money to or receive money from friends and family, without having to make trips to the ATM or branch offices for withdrawals, and then mailing checks.  The funds are exchanged directly between bank accounts, so transfers typically happen within minutes.  You can access the Zelle service directly from our mobile app or online portal.

Notifi – One of the keys to effectively managing your finances is keeping track of transactions, not only to make sure they are legitimate, but to monitor your weekly or monthly spending.  Notifi allows you to set up text or email alerts for transactions across your accounts.  You can get alerts for all transactions, or certain types, or even those that exceed specified amounts.  Notifi is available through our mobile banking app.

Card Valet – Similar to Notifi, Card Valet keeps you updated on transactions made with your cards.  In addition to simply notifying you of transactions, which can immediately alert you to fraudulent activity – you can set geofencing parameters to help protect your cards, and even set limits on why kinds of transactions they may be used for.  These are also great features if you’re giving your kids access to cards for gas, meals, or other specific needs.  Card Valet is also available through our mobile banking app.

While we’re looking forward to welcoming you back inside our lobbies, we know many of you will prefer these digital tools for a while – and maybe permanently when you see how useful they are.  Of course, if you have questions, need help, or have other banking needs, our staff is always ready to help you, either by phone, or by emailing us at customerservice@milfordbank.com.

Staying Financially Healthy During the Coronavirus Pandemic

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By Pam Reiss

As the world continues to cope with the COVID-19 pandemic, life as we know it has come to a grinding halt. Millions of us are working from home, our children are getting their schooling through videoconferencing, and our normal social and sports activities are in limbo.

Unfortunately, the situation can create some uncertainty around how to manage financially. Whether you’re currently working or not, it’s very likely you’ve been thinking about how to manage your finances during this time. The good news is at least some typical spending has naturally been cut because we’re all staying at home. But, there are many ways you may be able to keep your financial situation as stable as possible and stretch your budgets a bit.

Takeout vs. cooking – Ordering takeout or delivery is a great way to support local businesses during the crisis, but if you need to cut your spending, since you’re at home anyway, try limiting how often you order out. Instead, enjoy more home-cooked meals. There are many resources online for inexpensive, healthy meals. You can plan your entire week’s meals, make a complete shopping list, and make just one trip to the grocery store. You can even have one night of the week reserved for leftovers. If you want to continue to support a few local restaurants, set aside one or two days of the week for that.

Buy what you need – We’re still able to go to the grocery store, despite having to follow public safety guidelines. If you initially stocked up on non-perishables or frozen items, start using those instead of constantly buying more. Also, when you’re at the grocery store, there are still many items on sale each week. You can check out your grocery store’s flyer online to see what’s on sale, and plan your meals for the week accordingly.

Other ways to save – Take a look at some of the other things you’re spending on each week and see where you can cut a little out of your budget. Things to look at include video services. If you’re a cable subscriber, you might think about switching to a lower service tier, at least temporarily, or if you have multiple streaming services, consider cutting one of more of them. The monthly savings can add up quickly, and you can certainly find other ways to entertain your family.

Low interest rates – With interest rates dropping, this may be a good time to look into refinancing your mortgage or student loan, or even consolidating multiple loans. While there will be paperwork involved, lower interest rates can provide significant savings each month.

Emergency fund – If you’ve been following good financial habits and have built up an emergency fund, don’t automatically fall back on it. First take a look at ways you can reasonably adjust your spending. Then, if you find you need to dip into it, you can hopefully use just a little of it. If you’re fortunate enough to be working, this is a good time to add to or start your emergency fund. Since at least some of your normal extracurricular spending has been put on hold, consider putting that toward your emergency fund. You never know when you’ll need it.

Investment funds – It can be difficult watching retirement accounts and other investments lose money with the current market instability. The good news is they have historically bounced back reasonably quickly. Before you move or sell your investments, talk to your financial advisor, who can give you advice on whether it’s a smart move or not. Making a rash decision could actually end up hurting your investment funds.

Protect your credit – If at all possible, continue to pay your bills on time. If you’ve been using your credit cards, at the very least, pay the minimum on those to avoid hurting your credit score. If you are in a situation where you can’t pay some of your bills, contact your lenders. some lenders are allowing extra flexibility with payment terms or interest rates to help during the pandemic. You should also check your credit reports regularly. Fraudulent activity often increases during crises, and consumers and businesses are under a constant barrage from cyber criminals. Be extra cautious with emails, websites, and phone calls. There are thousands of malicious COVID-19 websites out there, and many phishing emails and phone calls looking to exploit uncertainty and fear.

The good news is most of the financial resources you normally have at your disposal are still available, though not in an in-person capacity. But, you can still contact us if you need advice.  Even though we’re all dealing with this pandemic, you can do things to help keep your finances in order and limit any long-term impact.

So You’re a First-Time Home Buyer, Here’s What You Need to Know

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By Paul Mulligan

Buying a home is one of the biggest milestones in your life – right up there with marriage and starting a family.  Being a homeowner has several benefits, including possibly lowering your monthly payments compared to renting and earning equity as your home value rises and you pay down your principal.  The immediate benefit, of course, is the happiness and security of owning instead of being beholden to a landlord.  As a homeowner, you have the ability to do what you like with pets, landscaping, renovations, and anything else that will make your house a home.

But, buying a home is also probably the biggest financial commitment you’ll make. There are many things to think about as you begin the process that can help make the process as enjoyable as it should be.

Here are several tips that can help make your first home purchase a positive experience.

Buy within your means – Many people tend to look at houses they can’t afford or that are too large.  Do the math to determine how much you can realistically spend while still allowing you to meet your monthly budget needs, as well as continuing to save for retirement and other future needs – including home maintenance and repairs.

Understand all your costs – In addition to the basic monthly mortgage payments, be aware of all the other costs that may impact your budgeting.  That includes property taxes and homeowners insurance, as well as mortgage and hazard insurances, depending on your financing need and location of the home.  You should also expect an increase in your utility bills, including heating and HVAC maintenance contracts – especially if they were previously included in your rent payments.

Plan ahead – Don’t rush into a home purchase.  Make sure you have all the information, have the financial resources to comfortably support the purchase, and are buying a home you will be happy in for many years.  Try to avoid draining all your savings and make sure you still have an emergency fund to fall back on should the need arise.  That’s particularly important as a homeowner so you don’t risk losing your house if you’re suddenly unable to make payments for a short period.  In fact, it’s even better if you can continue to grow your savings, so you have the resources to make improvements.

Manage your credit – It’s always important to follow good spending and credit habits, but especially when you’re looking to buy your first home.  Lenders will pull your credit reports, possibly several times, to make sure you are credit worthy and nothing has changed during the buying process.  Make sure you pay your bills on time, and be cautious opening up any new lines of credit before your loan is approved.

The perfect home vs. the right home – It’s rare that you’ll find the absolute perfect home for all your current and future needs.  Have a reasonable list of must-have features, and a second list of nice-to-haves.  Look for a home that checks off the first set, and maybe some of the second (you can always make improvements to check off more items later).  But don’t forget location.  Your neighborhood can be as big a factor in your long-term happiness as the house itself.  Do your homework and learn about the school system, commuting options and time, crime rates, tax rates, and other geographically dependent variables that may influence your decision.

Start the loan process early – As you start thinking about buying a house, don’t think you have to find the house first.  In fact, you may be better off starting the loan process while you’re looking, or even before you start.  Good houses can sell quickly, and once you find the house you love, you want to be able to move quickly.  Being pre-qualified for a home loan may give you an advantage over other potential buyers, especially if the seller wants to move quickly.

Seek advice – Especially as a first-time buyer, you will have many questions of your own, and many more you don’t even think to ask.  Contact one of our mortgage specialists, who can give help you find all of the information you need and help you throughout the process.  Also ask about our first-time home buyer program, which offers:

Keeping these tips in mind will help you have an enjoyable home buying experience and avoid complications that could arise.

*The Milford Bank is an Equal Housing Lender

What Does the New FICO Scoring System Mean?

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by Paul Mulligan, SVP, Retail Lending

When you apply for a loan, lenders have access to a variety of information they use to decide whether to give you a loan and at what terms.  The most popular of those resources is your FICO score, a three-digit rating based on information in your credit reports, which helps lenders decide how likely to repay a loan, how much you can borrow, the length of you loan repayment period, and your interest rate.

While FICO scores give lenders a quick and consistent way to determine borrower worthiness, they also make sure you, the borrower, get a fair credit assessment and access to the funds you need.  FICO has become the de facto industry standard for lenders.

This month, FICO has updated its scoring system for the first time since 2014, which could impact your scores.  The new scoring places more emphasis on trend data in your credit report, looking at your credit utilization and payments over the past two years, as opposed to only current balances.  For instance, new data might include whether you tend to pay off balances quickly, carry extended debt, or consolidate loans, as well as your credit management predictability.

The other major change reflects changes in credit reports.  Tax liens, insurance-paid medical collections, and judgments are no longer part of credit reports, and healthcare defaults won’t appear on credit reports for at least six months.

At the end of the day, though, the real question is, how will the new scoring impact you?

The new scores will be less forgiving of risky credit behavior.  That means, if you regularly run up your credit, don’t pay off balances consistently, carry too many credit cards, or consolidate debt into personal loans in order to free up your credit cards, you may see your score go down.

On the other hand, some spending habits that may have previously been viewed negatively may no longer hurt you.  For instance, if you run up seasonal balances – such as during the holidays or summer vacations – and then pay them off, your score may not be negatively impacted because those are predictable one-time spikes, not regular habits.

Ultimately, what you need to keep in mind is the basics of good credit haven’t changed.  Payment history (35%) and credit usage (30%) are still the two biggest components of your FICO score.  If you follow good credit practices – pay your bills on time, keep balances below your credit limits, and don’t apply for too many new lines of credit (or too often) – you should have nothing to worry about.  In fact, if you manage your credit well, the new scoring could actually improve your score.

If you’re concerned about your credit rating and want to work to improve your score, the sooner you start following good financial habits and budgeting, the faster you can see positive change.  Of course, it’s not always easy, so if you need help or want advice on how to become more responsible with your spending, talk to our specialists.  They can provide information on financial best practices, budgeting and saving tips, and improving your credit.  On the other hand, if you have managed your credit responsibly, you probably don’t have anything to worry about.  Just continue to follow smart banking habits.

Don’t Let Emergencies Sink You into Debt

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By Celeste Lohrenz

Emergencies are, by definition, unexpected and unpredictable.  They can also have significant financial ramifications – either due to high costs or loss of revenue or both.  By nature, emergencies aren’t easy to deal with and most can’t be avoided, but there are ways to make them more manageable, starting with making sure you have an emergency fund.  The question you should ask yourself is, “If I lose my job, if my roof starts leaking, or if my car needs a new transmission, am I financially prepared am I to deal with it?”

Why start an emergency fund?

An emergency savings fund or account could be the difference between being able to manage unexpected expenses and falling into deep debt.  If a significant expense comes up, knowing you have the funds to support at least some of it can keep you from having to worry about your monthly fixed expenses without taking out loans or maxing out credit cards.

How much do you need?

How much to save is really a question of several variables, including income, monthly fixed costs, lifestyle and other variable expenses, size of family, and certainly how much can you actually afford to save each month.  A common goal is to have 3-6 months’ worth of expenses in an emergency fund, but even as little as $500 can cover many unexpected expenses, like a leaky bathroom pipe or bad brakes on your car.

Start by setting an attainable goal and, once you’ve reached that target, you may find you want to increase the size of your emergency fund, so you can set a second target.  When your emergency fund has reached a point with which you’re comfortable, you may have found it easy to live with the reduction in spending.  In that case, you can use the same philosophy to start a new account to start saving for a larger planned expense, such as a vacation, wedding, mortgage down payment, college  tuition, etc.

How to grow the fund?

There are many ways to find money to add to your savings, from cutting expenses to finding supplemental income sources.  One place to start is the change you get when paying with cash.  The coins, $1 and even $5 bills can add up quickly if you put it into a jar at home every day, then deposit it each week or month.  But, you have to have the willpower to avoid dipping into it for an iced latte or other items.

One of the most effective ways to save, though, is using automatic deposits.  We can help you set up automatic monthly transfers into your emergency fund, so you don’t even have to think about it.  Saving apps are another very useful tool that help automate your emergency fund growth.  The Milford Bank has partnered with Plinqit to help customers not only save, but earn money in the process as they reach their goals.

Where to put the money

The key is to make sure you have access to your emergency fund should you need it, but you don’t want it to be so convenient that it becomes a daily temptation.  Interest-earning savings accounts are a good option, because they can be accessed at any time without penalty, but you should keep your emergency fund in a separate account from your regular savings to avoid using it.  Your bank’s specialists can help you determine exactly what kind of account is most suitable for your individual needs.

When should you access this account?

The point of an emergency fund is to have it available if unexpected expenses come up that you can’t handle with your monthly budget.  if you’re faced with an expense you weren’t expecting, consider whether it’s actually an emergency – something you absolutely can’t avoid doing – and whether you may be able to cover the costs with your monthly budget, even if you have to adjust it slightly.  By using automated tools to fund the account, you will be less likely to spend it until an emergency arises – out of sight, out of mind, as they say.  But remember, emergencies can happen at any time, so if you do need to dip into your fund to cover an expense, you should start saving again right away to build it up again.  You never know when the next emergency is going to happen.

What you need to know about using P2P payment apps

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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

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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.