6 Financial Traps New College Graduates Should Avoid

Monday, June 12 at 08:45 AM
Category: Personal Finance
As college students graduate and start their careers, financial responsibility should be a top priority. However, it’s easy to fall into traps that could hinder new college graduates from securing their financial future.
 
New college graduates should avoid the following financial traps:
  • Not having a budget. Simply put, don’t spend more than you make. Calculate the amount of money you’re taking home after taxes, then figure out how much money you can afford to spend each month while contributing to your savings. Be sure to factor in recurring expenses such as student loans, monthly rent, utilities, groceries, transportation expenses and car loans. 
  • Forgoing an emergency fund. Make it a priority to set aside the equivalent of three to six months’ worth of living expenses. Start putting some money away immediately, no matter how small the amount. A bank savings account is a smart place to stash your cash for a rainy day.
  • Paying bills late – or not at all. Each missed payment can hurt your credit history for up to seven years, and can affect your ability to get loans, the interest rates you pay on loans and your ability to get a job or rent an apartment. Consider setting up automatic payments for regular expenses like student loans, car payments and phone bills.
  • Racking up debt. Understand the responsibilities and benefits of credit. Shop around for a card that best suits your needs, and spend only what you can afford to pay back. It’s a great tool if you use it responsibly. 
  • Not thinking about the future. It may seem odd since you’re just beginning your career, but now is the best time to start planning for your retirement. Contribute to your employer’s 401(k) or similar account, especially if there is a company match. Invest enough to qualify for your company’s full match – it’s free money.  
  • Ignoring help from your bank. Most banks offer online, mobile and text banking tools to manage your account night and day. Use these tools to check balances, pay bills, deposit checks, monitor transaction history and track budgets.  
College graduates can find many enticing ways to spend their paychecks from their first “real” job. However, by avoiding these financial traps, the new graduate can make financial responsibility a top priority instead of exceeding their new income.
 
Information courtesy of American Bankers Association. 
 
Tags: Budgeting, Debt, Financial Education, Savings
 

Disaster Preparedness Includes Safeguarding Financial Information

Monday, May 01 at 08:30 AM
Category: Personal Finance
April showers may bring May flowers, but unfortunately, spring also can bring severe weather that results in disasters like floods, fires and tornadoes.

And while no one wants to think they will be the victim of such a disaster, it’s best to be prepared. Having access to financial and other documents should be part of that preparation.
 
Below is a list that can serve as a good starting place when it comes to the documents you may need if you’re the victim of a natural disaster.
 
Note: It is imperative to store this information somewhere secure. That could be at home in a fireproof and waterproof box, at a bank in a safe deposit box, or maybe electronically in a secure cloud-based service. If you choose to store these documents at home, be sure to hide it somewhere out of sight of would-be intruders.

Basic identification – These are documents that can help you identify yourself and your family, your relationships and/or your status.
  • Driver’s license, passport, Social Security card, green card
  • Vital records such as birth and marriage certificates, adoption papers, etc.
Financial and legal documents – These can help you request assistance from your insurance provider and/or disaster assistance programs.
  • Mortgage documentation, rental or lease agreement, property deed
  • Checking and/or savings account statements, retirement and investment account statements, tax returns, insurance policies, will or trust, power of attorney
  • Vehicle title and registration, loan documents
Medical information
  • Health and dental insurance cards
  • List of prescriptions and any allergies, pharmacy information, contact information for doctors
  • Living will, medical power of attorney
Emergency contact information
  • Employers/supervisors
  • Schools
  • Home repair services such as utilities, plumber, electrician, roofer, etc.
Again, once you have compiled this information, it is critical to store it securely. Whether that’s at home in a fireproof and waterproof box, at a bank in a safe deposit box, or electronically in a secure cloud-based service, it needs to be in a place that’s accessible only to you and hidden from would-be thieves.
 
Regardless of the means you choose, no one wants to envision a scenario in which they need to access this kind of information due to a natural disaster. Being prepared, however, can provide some measure of comfort. 

Tags: Consumer Protection, Financial Education
 

Tech Support Scams

Monday, April 17 at 09:35 AM
Category: Personal Finance

In a recent twist, scam artists are using the phone to try to break into your computer. They call claiming to be computer techs associated with well-known companies like Microsoft. They say that they’ve detected viruses or other malware on your computer to trick you into giving them remote access or paying for software you don’t need. But the purpose behind their elaborate scheme isn’t to protect your computer – it’s to steal your identity or/and to make money.

How Tech Support Scams Work
Scammers have been peddling bogus security software for years. They set up fake websites, offer free “security” scans*, and send alarming messages to try to convince you your computer is infected. Then, they try to sell you software to fix the problem. At best, the software is worthless or available elsewhere for free. At worst, it could be malware — software designed to give criminals access to your computer and your personal information.
 
The latest version of the scam begins with a phone call. Scammers can get your name and other basic information from public directories. They often try to gain your trust by pretending to be associated with well-known companies or confusing you with a barrage of technical terms. They may ask you to go to your computer and perform a series of complex tasks. Sometimes, they target legitimate computer files and claim they are viruses. Their tactics are designed to scare you into believing they can help fix your “problem.”
 
Once they’ve gained your trust, they may:
  • Ask you to give them remote access to your computer and then make changes to your settings that could leave your computer vulnerable.
  • Try to enroll you in a worthless computer maintenance or warranty program.
  • Ask for credit card information so they can bill you for phony services — or services you could get elsewhere for free.
  • Trick you into installing malware that could steal sensitive data, like user names and passwords.
  • Direct you to websites and ask you to enter your credit card number and other personal information.
Regardless of the tactics they use, their purpose is to steal your identity or/and to make money.

If You Get a Call
If you get a call from someone who claims to be a tech support person, hang up and call the company yourself on a phone number you know to be genuine. A caller who creates a sense of urgency or uses high-pressure tactics is probably a scam artist.
 
Keep these other tips in mind:
  • Don’t give control of your computer to a third party who calls you out of the blue.
  • Do not rely on caller ID alone to authenticate a caller. Criminals spoof caller ID numbers. 
  • If you want tech support, look for a company’s contact information on their software package or on your receipt.
  • Never provide your credit card or financial information to someone who calls and claims to be from tech support.
  • If a caller pressures you to buy a computer security product or says there is a subscription fee associated with the call, hang up. If you’re concerned about your computer, call your security software company directly and ask for help.
  • Never give your password on the phone. No legitimate organization calls you and asks for your password.
  • Put your phone number on the National Do Not Call Registry*, and then report illegal sales calls*.
If You’ve Responded to a Scam
If you think you might have downloaded malware from a scam site or allowed a cybercriminal to access your computer, don’t panic. Instead:
  • Get rid of malware*. Update or download legitimate security software and scan your computer. Delete anything it identifies as a problem. 
  • Change any passwords you gave out. If you use these passwords for other accounts, change those accounts, too.
  • If you paid for bogus services with a credit card, call your credit card provider and ask if they can reverse the charges. Check your statements for any other charges you didn’t make, and ask to reverse those, too.
  • If you believe someone may have accessed your personal or financial information, visit the FTC’s identity theft website*. You can minimize your risk of further damage and repair any problems already in place.
  • File a complaint with the FTC at ftc.gov/complaint*.
How to Spot a Refund Scam
If you paid for tech support services, and you later get a call about a refund, don’t give out any personal information. The call is almost certainly another trick to take your money.
 
The refund scam* works like this: Several months after the purchase, someone might call to ask if you were happy with the service. When you say you weren’t, the scammer offers a refund. Or, the caller may say the company is going out of business and providing refunds for “warranties” and other services.
 
In either case, the scammers eventually ask for a bank or credit card account number. Or they ask you to create a Western Union account. They might even ask for remote access to your computer to help you fill out the necessary forms. But instead of putting money in your account, the scammers withdraw money from your account. If you get a call like this, hang up, and report it at ftc.gov/complaint*.

Conclusion
You don’t need to be a victim of a tech support scam. Learn how these scams work, so you can detect them for what they are and protect yourself.

Information courtesy of Federal Trade Commission Consumer Information.

Links marked with * go to a third-party site not operated or endorsed by Arvest Bank, an FDIC-insured institution.  

Tags: Consumer Protection, Financial Education, Fraud Alert, Privacy and Security, Technology
 

Need a Mortgage? Know Your Options

Monday, April 10 at 09:35 AM
Category: Personal Finance
Sometimes shopping for a mortgage can seem overwhelming. However, these five tips will help guide your search to find the best home loan to fit your needs. 
 
  1. Know what you can afford. Review your monthly spending plan to estimate what you can afford to pay for a home, including the mortgage, property taxes, insurance, monthly maintenance and utilities. Make sure you save for emergencies. Plan ahead to be sure you will be able to afford your monthly payments for several years. Check your credit report to make sure the information in it is accurate. A higher credit score may help you get a lower interest rate on your mortgage. 
  2. Know your options when comparing loan programs. Shopping takes time and energy, but not shopping around can cost you thousands of dollars. Find a lender and loan officer you’re comfortable with to give you the information to make informed choices. A loan officer can help you choose the loan that best meets your unique needs.
  3. Understand loan prices and fees. Many consumers accept the first loan offered and don't realize they may be able to get a better loan. Lenders and brokers consider the profit they receive if you agree to the terms of a loan with higher fees, higher points or a higher interest rate. Shopping around is your best way to avoid more expensive loans.
  4. Know the risks and benefits of loan options. Mortgages have many features – some have fixed interest rates; some have adjustable rates; some have payment adjustments; on some you pay only the interest on the loan for a while and then you pay down the principal (the loan amount); some charge you a penalty for paying the loan off early; and some have a large payment due at the end of the loan (a balloon payment). Consider all mortgage features, the APR (annual percentage rate) and the settlement costs. Ask your lender to calculate how much your monthly payments could be a year from now, and five or 10 years from now. Mortgage calculators* can help you compare payments and the equity you could build with different mortgage loans.
  5. Get advice from trusted sources. A mortgage loan is one of the most complex, most expensive financial commitments you will ever assume – it’s okay to ask for help. Talk with a trusted housing counselor or a real estate attorney you hire to review your documents before you sign them. You can find a list of counseling resources at NeighborWorks* and on the U.S. Department of Housing and Urban Development's (HUD)* website or by calling (800) 569-4287.
With some conscious effort and research, you can feel more confident in whom you select to finance your home loan needs.

Information courtesy of Federal Reserve. 

Links marked with * go to a third-party site not operated or endorsed by Arvest Bank, an FDIC-insured institution.

Tags: Financial Education, Home Loans, Mortgage
 

Tips to Simplify Home Loan Process

Tuesday, March 28 at 09:20 AM
Category: Personal Finance
Are you looking for ways to simplify and reduce the stress of the home loan process? Check out these tips to help you do just that!

Disclose All Assets: Loan officers regularly run into situations where a little extra verified funds can make the difference in a loan approval. When applying for a loan, borrowers sometimes forget equity in assets such as vested interest in retirement plans, automobiles or other real estate that may help to approve a borrower.

Timely Response: Another “big” issue loan officers face is timeliness of response for documents. It’s imperative borrowers realize returning requested documentation immediately is integral in a successful and stress free transaction, especially with the mandated time frames for review.  

Verify Funds:
Funds used to close, including cash, will need to be seasoned, verified or tracked to be utilized in the home-buying process. 

Closing Times: Real estate agents, lenders and other service providers are faced with quick closing times on a regular basis. And while sometimes this is unavoidable, all parties should understand the potential pitfalls that can result. In many cases, problems can be avoided if all parties had a slightly longer closing time frame. Items to consider when determining a closing time: 
  • Sellers and buyers scheduled time frames regarding things such as: scheduling moving companies, closing on other homes, weather delays, utility transfers, holidays and others. 
  • Documentation, contractual obligations, and negotiations when inspection and repairs are required. Weather delays may significantly impact a closing date while waiting for work to be completed on or around the exterior of a home. 
  • New rules that allow additional time for review of initial disclosures, estimates, closing costs and closing statement review. 
Although there are legitimate reasons for an expedited closing date, giving all parties the time they need to successfully complete their responsibilities, will help avoid unnecessary stress on buyers and sellers.  

Servicing Your Loan: When you get a mortgage, you may think the lender will hold and service your loan until you pay it off or sell your home. That’s often not the case. In today’s market, loans and the rights to service them often are bought and sold. In many cases, the company that you send your payment to is not the company that owns your loan. So it’s important to know who may ultimately service your mortgage, upfront, in the mortgage process. At Arvest Bank we service 99% of our mortgage loans so what starts here, stays here.   

All parties involved in a real estate transaction, if informed and understand these issues, can bring tremendous value and provide a stress-free customer experience. It reminds me of a couple things my grandmother use to say, when quality is important or I was faced with an important task – “Haste makes waste,” and, “A job worth doing, is worth doing right.” Words to live by! 

Tags: Financial Education, Home Loans, Mortgage
 

As Credit Cards Enhance Rewards, Consumers Advised to Comparison Shop

Wednesday, March 22 at 09:15 AM
Category: Arvest News

Did you know 25 million credit card holders have held the same credit cards for at least a decade?

LOWELL, Ark. – Consumers routinely search for the best price or the best deal when making a long-term financial commitment – from automobiles to cable companies to phone carriers. They don’t, however, tend to comparison shop once they have committed to a credit card.

A report by creditcards.com* shows that some 25 million credit card holders have held the same card for at least a decade, and another 20 million have never switched to a different creditor. This, despite the emergence of rewards programs that offer consumers robust benefits. 

Among the most popular perks offered through reward programs are cash-back options and bonus rewards. When offered, cash-back and other reward options can put extra money in the pocket of cardholders. Cash-back benefits can be applied as a credit on a future statement or deposited electronically in the customer’s bank account. 

Some financial institutions offer bonus opportunities such as providing customers with as much as triple rewards during certain times throughout the year, when they spend a particular amount on their card or when they charge specified items such as groceries or gas. 

More than half of consumers who did switch to a new credit card made the change because of a better rewards program, according to a creditcards.com* survey from 2015.

A rare and competitive offering among a handful of institutions is a rewards program that touches every level of credit cards. From a classic card to the platinum level, a rewards program could be in place, though the rewards may vary.

In addition, card issuers are becoming increasingly competitive by eliminating various fees, such as annual rewards program fees and balance transfer fees, and increasing the amount of control cardholders have at their fingertips.

One factor that will always get the attention of cardholders is interest rates. An individual’s improved credit score could mean they are eligible for a lower rate on their credit card. That provides another option for saving money and another reason to evaluate and compare programs. 

The Federal Reserve anticipates additional increases in interest rates later this year. With that change, every percentage point and every rewards option could affect consumers’ wallets in one way or another.

The bottom line for consumers is that, with the emerging new benefits programs offered by credit card issuers and the expectation of a rising rate environment, comparison shopping for the best credit card for their particular needs is becoming more important than ever.

Links marked with * go to a third-party site not operated or endorsed by Arvest Bank, an FDIC-insured institution.

Tags: Arvest Flex Rewards™, Credit Cards, Financial Education

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