College Credit: Six Ways to Save on Textbooks

Textbooks are one of those necessary, but pricey, college expenses. It’s easy to cut costs on food, clothing and even housing, but textbooks are a necessary requirement while in school. According to the Government Accountability Office, the cost of textbooks rose 82 percent from 2002 to 2012. That’s nearly three times the rate of inflation. And the College Board reports that students spend about $1,200 per year on books and supplies.

So what’s a college student to do? Here are six ways to save on your college textbooks:

  1. Don’t shop at the college bookstore. The bookstore has a captive audience and is very convenient, making prices higher.
  2. Find used books. Online bookstores, CraigsList, and bookstores that are not affiliated with your college are good places to start. MyNextCollege.com has a search tool that can help, too.
  3. Check the library. If your professor is notorious for not using the textbook, consider not purchasing it. Visit the library when you need occasional access to available texts for completing assignments.
  4. Buy or rent the digital version. Many textbooks are now available as eBooks, and they’re often less expensive than purchasing a hard copy.
  5. Share books with a roommate or friend. Split the costs and make the book accessible to both parties. You can even set up a regular schedule or study date so you both have equal access.
  6. Do your research. CenageBrain.com, efollet.com, BestBookBuys.com, BookRenter.com and others are great resources to rent, comparison shop, or even buy or rent single chapters of textbooks. Do your homework to find the best prices!

Still Not Saving? You’re Not Alone!

We like to think of ourselves as learning animals. We take our lived experiences, extract valuable lessons from them, and use that information to improve our daily lives. This is how we get better at doing things over time.

However, a recent survey from Bankrate.com shows that we haven’t yet learned the lessons of the Great Recession. While Americans paid down their debt in the months since the recovery, a shocking 26% of Americans still report having no emergency fund. Another 24% have less than three months living expenses saved. Only 23% of survey respondents have the recommended 6 months living expenses saved.

It’s not for lack of caring. The same survey reveals that 60% of Americans don’t feel comfortable with their current savings position. We all know we need to save more, but we still don’t actually do it. Why is that?

Many experts say the problem is there’s just not enough money left at the end of the month for savings. This is true no matter how much you make; fewer than half of people with incomes more than $75,000 have that 6-month cushion. Rebecca Kennedy, the founder of Kennedy Financial Planning in Denver, says that after utilities, rent, and other expenses, there’s no money left over for savings.

Not having an emergency fund is like walking a tightrope without a net. No one likes to think about it, but what you would do tomorrow if you lost your job, wrecked your car, or had to miss work due to illness? In 2008, the answer provided by many would have involved tapping into a home equity line of credit. But, when house prices began falling and interest rates rose, these people had to rely on expensive debt to finance their lifestyles. That forced them to postpone retirement, miss vacations, or compromise on educational plans for their children.

You can avoid this problem. It may seem impossible to create an emergency fund, but there are always ways to squeeze a few extra dollars out of each month. Consider these seven ideas:

1.) Start small. If you save $5 a week for four years, you’ve got an emergency fund of just over $1,000. That’s a great start to a rainy day fund, and you can do it by giving up one vending machine soda a day. Many people stash every $5 bill they get in a coffee can or store all their loose change. You might also consider a 52-week plan where you save $1 the first week, $2 second, and so on. These incremental steps can make a big difference in the long term – at the end of a year, you’ll have saved almost $1,400.

2.) Take on a second job. It’s never fun to leave one job and head to another. Remember, though, that you’ll have to work fewer hours to build a savings than you would have to work to pay down debt. Don’t limit your search to part-time jobs. Consider freelancing, taking surveys, babysitting, or selling tupperware. You don’t need to finance another lifestyle. You just need to make enough to start a savings fund.

3.) Pay yourself first. Think about your savings as another bill. This mode of thinking prevents you from treating the money as discretionary and frittering it away on impulse buys and luxuries. Make your savings as important as your house note, car payment, and utility bills.

4.) Automate it. Consider setting up a Club Account or a savings account with direct deposit. This step ensures you’ll remember to take the savings out of your budget each month. You’ll also be earning a little bit of interest on your savings to help you on your way. These savings products have the flexibility to allow for immediate withdrawals if you need it, but are limited by law in how many withdrawals they allow. This means your money is there when you need it, but far enough away that you won’t be tempted to spend it.

5.) Put luxury in the back seat. Whether it’s a fancy coffee drink, a pack of cigarettes, a fast food meal, or the latest cell phone, things we don’t need will consume much of our income. You don’t need to give up your vices all together. In fact, financial expert Candice Elliot compares these choices to dieting. Repeated denials can drain our will-power, leading us to snap back harder. The answer may be to cut back on our consumption instead. Go without your Starbucks on Friday or wait 6 months for the price to drop on a gadget. Put the difference into your savings account.

6.) Look at recurring expenses. If you’re honestly spending everything you get on your monthly bills, it may be time to look at them. Consider cutting your TV services or switching to a pre-paid cell phone plan. Simply giving up a premium movie channel for a year could save you as much as $240. Now that Game of Thrones is over for the season, do you even need it? These don’t have to be long-term choices. Your goal should be to make temporary sacrifices to ensure yourself against future loss.

7) Don’t spend it. Your emergency fund should only be used for actual emergencies. Ask three questions before you take even a dollar out of your emergency fund. Is the thing I’m paying for absolutely necessary? Is there nothing I can cut back on this month to pay for it? Do I have to pay for it right now? Unless the answer to all of these questions is yes, leave the money where it is.

Early Retirement Costs You Might Have Missed

Retiring early is the dream. You get to spend more time with your family and enjoy your hobbies while you’re healthy enough to do so. You can say goodbye to the workaday world and begin your permanent vacation.

Maybe it’s less of a dream and more of a necessity. Maybe health problems like chronic pain or arthritis, are forcing you to consider giving up your career before age 65. Perhaps your children need you to help with caring for your grandchildren.

Whatever your reason for retiring early, a new study released on 6/12/14 by Fidelity Investments warns it will cost you in ways you might not expect. According to the study, early retirees can expect to pay an extra $17,000 per year in medical expenses.

The reason? Medicare coverage gaps. You give up your employer-provided health insurance when you retire, and Medicare doesn’t kick in until age 65. This means you’re on your own at a time when your health care costs are near their peak. Insurance companies charge older policyholders higher premiums, which means they’ll claim a bigger chunk of your retirement money.

As a savvy credit union member, you know the advantages of planning ahead for your golden years. Let’s look at a few ways you can avoid sticker shock at your retirement party:

1) Short-term insurance

One popular option is to look for an emergency-only or high-deductible insurance plan (HDHP). These plans feature inexpensive monthly premiums, but offer little in the way of coverage. These budget-friendly insurance options are great if private health insurance is too expensive.

You can expect to pay for a variety of costs out-of-pocket. Routine, preventative, and non-emergency medical procedures will be your responsibility. A regular checkup will cost at least $75 and the costs can escalate if your doctor orders tests or other procedures. You may also pay full price for prescription drugs.

This option is best if you’re retiring just before age 65. You can afford a few months of risk before Medicare coverage starts. However, you’ll still want another savings option to help with massive medical bills.

2) Staggering your certificates terms, so that you always have something renewing can provide flexibility, accessibility and growth potential

You likely use savings certificates (similar to CDs at a bank) to keep an emergency fund on hand. These savings instruments are ideal for building up money in case of a rainy day. You may want to create one specifically for your health care costs.

You’ll want to keep this money separate since you’ll have different needs for it. A sudden, unexpected medical bill is different than needing a new car. You’ll likely have a little more time to pay your medical bill. Many hospitals are willing to work around your financial situation.

A 6- or 12-month certificate provides the perfect combination of accessibility and growth. Once you turn 65, you can add your remaining funds to your other retirement savings or even use it to finance a vacation!

3) Open (and use) a Health Savings Account

A Health Savings Account (HSA) is a special tax-advantaged account for your savings that allows you to defer taxation on the money. The idea is that the money you spend on health care costs shouldn’t be taxed. So, you can save money to pay premiums, deductibles, and other healthcare-related expenses.

These accounts have been growing in popularity this year. If your family insurance plan has a deductible of $2,500 or more, you can open an HSA at your credit union. You can contribute up to $6,450 to your HSA per year, tax-free. Many employers also provide matching contributions to HSAs as part of their benefits package.

While withdrawals from your HSA are allowed only for medical expenses, this rule is waived for people 65 or older. While non-medical withdrawals are taxed, the money still grows tax-free. Many financial planners are advocating the use of HSAs as a kind of “shadow IRA.” With them, you reduce your current tax burden while saving for retirement.

Planning for your future health care costs can be scary, but it’ll be much scarier to go into retirement unprepared. Sit down with a representative from your credit union today to discuss how you can save for your health care in retirement. You’ll thank yourself later.

3 Financial Decisions To Make Before Interest Rates Start To Climb

Interest rates are headed back up. Every economic indicator, from employment reports to bond market performance, points in this direction. If you’ve been watching financial news shows, you’ve definitely heard this prediction. Yet to most observers, it’s somewhat abstract and far away. Sure, interest rates are going up; so what? And when?

You’ve no doubt heard that if you’re thinking about refinancing your home or buying a new one, now is the key time. That’s true, but that’s not the whole story. Here are three other financial decisions that can save you money in the long run if you make them soon.

1.) Consolidating your unsecured debt

If you’re carrying unsecured debt (credit cards, personal loans, or payday loans), you might find yourself paying a lot more soon. Don’t assume you are locked into your current rate. Most often, these kinds of debts use an adjustable interest rate. How much it costs to service your credit card debt is determined, among other factors, by the prime rate as set by the Federal Reserve. As the interest rates that the central bank charges other financial institutions rise, the rate your credit card provider charges you will probably also rise.

If you owe $7,000 on your credit cards (the American household average), a one percent change in the interest rate would mean an increase of $70 to your balance every month. That could mean an increase of as much as $15 on minimum monthly payments. That’s a tough hit, and it will also just make it harder to dig yourself out of
debt trouble.

It’s best to pay off this debt as quickly as possible. If you have a large balance, though, consider a debt consolidation loan. These loans have fixed interest rates, so your debt won’t get more expensive in response to changes in the economy. Working with a representative from your local credit union can keep this cost from consuming a bigger portion of your budget.

2.) Buying a new car

If you’ve been on the fence about upgrading your personal transportation or getting another vehicle for a new driver, the coming interest rate rise might be the final push you need. The rates that lenders can offer on car loans are influenced by the prime rate, too. An increase in the prime rate means car loans are going to get more expensive, thus decreasing your buying power.

For a $20,000 car, a one percent increase in interest rates means paying $10 more a month on a 5-year car loan. It means paying $400 more over the lifetime of the loan. That’s a direct decrease in the amount of car you can afford. Worse yet, dealerships may run promotions promising no interest financing for a portion of the loan. These promotions almost always revert to an adjustable rate based, in part, on the prime rate.

As a credit union member, you can get access to fixed rate auto loans that allow you to get the most car for your money. You can also plan with confidence knowing the portion of your budget devoted to paying your car note. You can even negotiate from a position of power knowing you’ve got financing squared away with a lender who’s got your back.

3.) Self-directed retirement planning

If you take personal care of your retirement funds, you need to prepare yourself for the market changes that will result from rising interest rates. These rates will be coupled with a decrease in bond rates. This change will send brokerage investors running from long-term growth bonds into securities and commodities. This market shift will likely produce a great deal of short-term instability, as speculators try to time the shift in the market. The resulting market volatility can place your retirement savings at risk.

Earnings on deposits rise when the cost of loans increases. The rates you can earn on certificates and savings accounts will go up in response to changes in the prime rate. Best of all, money you put into these accounts will be safe from the volatility of the market as changes occur in the economy or as inflation rises. In most instances, you also have the option of moving funds to other types of accounts and investments when the time is right for you.

It’s easy to think of the decisions of the Federal Reserve as occurring in another separate world. The events of Washington, DC can seem far removed from your community. The truth is, in an increasingly interconnected world, timing your personal decisions to take advantage of changes in policy can save (or make) you money in the long term. This may not be enough motivation to buy a car you don’t need or consolidate a $100 credit card bill. But, if you’re making big financial decisions, you need to be smart about your timing and act fast. Stop into your local credit union office to see how they can help you before it’s too late!

Do MORE of Everything this Summer

AA family painting

With a Home Equity Line of Credit at an Unbeatable APR* until 2016!

With a home equity line of credit from NASA FCU, you’ll be able to take that special summer vacation, spiff up the house, pay for those unexpected expenses—or all of the above! And, for a limited time, when you open a home equity line of credit with NASA FCU, you can lock in a low intro 2.99% APR* until January 3, 2016! After the introductory period, rates are variable and start as low as 4.00% APR.

With a low intro 2.99% APR until January 3, 2016, you can put your equity to work for you and save more—with no points, closing costs^ or fees! Plus, it’s never been easier to get more from the equity in your home. Use your credit line—anytime—through eBranch or handy convenience checks. And the interest you pay is potentially tax deductible.**

So what are you waiting for? Apply online or call 1-888-NASA FCU, ext. 802 today.

travelers on bikes

OR the Smart, Affordable Signature Loan!

Have expenses or a major purchase on the horizon? Or maybe you’d like to roll your higher interest loans into one lower monthly payment. Whatever your case may be, you can now easily get the cash you need—and do more of what you want—with the NASA FCU Signature Loan.

The Signature Loan is a smart way to manage your money, offering an affordable and predictable payment plan. You can use loan proceeds to pay for upcoming expenses or consolidate existing balances—and rest assured knowing that your interest rate and monthly payment are fixed for the life of your loan.

Apply for a Signature Loan and do more today. Apply online, call 1-888-NASA-FCU (627-2328), ext. 200, or visit your local branch, to take advantage of this easy and affordable way to pay for expenses.

 

*APR=Annual Percentage Rate. Introductory APR is good until January 3, 2016. Upon expiration of the intro rate, all balances will accrue interest at the variable APR in effect for your account. APRs are based on evaluation of the applicant’s credit. Your APR may vary. Other conditions apply. 4.00% Floor Rate regardless of a temporary lower Prime Rate. The APR is a variable rate and is based on the Prime rate as disclosed in The Wall Street Journal plus or minus a margin based on your credit history. The rate is subject to change. Maximum APR is 18%.

^No closing cost offer available one time only per property and for primary residence only. Closing costs must be repaid if line is closed before 24 months. For loan amounts of $100,000, closing costs typically range between $1,200 and $2,100. Closing costs can vary based on the location of the property and the amount of the Loan. Fixed Equity Loan Example: A $100,000 loan at 2.99% APR for 20 years would have an estimated monthly payment of $554.22. A $100,000 loan at 4.00% APR for 20 years would have an estimated monthly payment of $606.15.

equal-housing-lender**Consult your tax advisor about the deductibility of interest. We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.

Get MORE Benefits with Premier Checking

hammock lady

  • Premier Checking is for members who want to be rewarded for their combined Credit Union balances.
  • Premier eChecking is for members who want to be rewarded for enrolling in Direct Deposit or using NASA FCU Online Bill Pay (at least 3 times per month) with eStatements.
  • Premier Preferred Checking is for members who want to be rewarded with dividends for maintaining higher checking balances.

More Than a Traditional Account

  • Free Mobile Banking & Remote Deposit*—anytime, anywhere banking
  • Free use of 30,000 ATMs—surcharge-free cash withdrawals nationwide
  • Free Check Card with Cash Back—provides cash back with every purchase
  • Free EarlyAccessTM Payroll—gets all of your direct deposits in your account one day earlier
  • NSF FreePassTM—lets you enjoy a waived NSF fee for you once per year

Learn More

*Eligibility for Remote Deposit is subject to Credit Union approval.