Make the Grade on Back-to-School Shopping

Tuesday, July 18 at 11:00 AM
Category: Personal Finance

As kids prepare to return to class, it’s the parents who are gearing up for the shopping assignment.

Back-to-school shopping is one of the most significant shopping events all year, second only to the winter holiday season, according to the National Retail Federation.* Last year, total back-to-school spending was estimated to top $75 billion nationwide.

During the weeks leading up to the first day of school, parents generally spend hundreds of dollars per child* on clothing, accessories, school supplies, electronics and more. It’s no wonder that the winding down of summer can be a stressful time for many families. 

That’s why we’ve compiled a list of three easy tips to help you ace the school shopping assignment with confidence and perhaps a little less stress.

  1. Make a list and set a budget
    This step is paramount to your back-to-school shopping success. Gather your child’s school list of needed supplies and take an inventory of any leftover school supplies* that your child may be able to use again this year. Compile lists of clothing items, electronics and equipment that your child will need for the year. It’s also important to think beyond supplies, electronics and clothing—consider upcoming school activities or clubs your child may want to join and the costs associated. Examples could include field trips, basketball uniforms, a musical instrument, or fees for Spanish club. This will help you get the full picture and plan out your budget accordingly. 

    BONUS POINTS: Planning for back to school is a perfect opportunity to talk to your kids about money. Having your children develop and stick to a budget for back to school expenses can help instill good financial habits. Arvest’s Education Center also has a number of online calculators and links to useful articles to help families budget and save for the school year. 
     
  2. Plan ahead and find deals
    Be on the lookout for bargains, especially for big-ticket items that are on your list, like computers and graphing calculators. Experts note that deals on pencils and notebooks are easier to find. Consider following your favorite retailers on social media or subscribing to store e-newsletters to be among the first to learn of flash sales, special discounts and promotions announced via those channels. If you prefer to do your back-to-school shopping online, look for special “online only” deals and free shipping from many of the major national retailers. 

    Also, be sure to take advantage of tax free shopping days, where applicable. Shopping on those days will help you get the biggest bang for your buck on clothing and other qualifying items, even some online retailers participate. Many of the communities Arvest serves are located in states that have tax free holiday shopping days. Additional details are available at the links below.
  3. Spend wisely
    When it’s time to tackle your list, it’s easy to get caught up in the moment, but you should try to resist the urge to splurge, experts warn. Stick to your list and budget and you’ll be glad you did. It’s also a good idea to discuss how your family will pay for the purchases before hitting the store or buying online. Will you be paying with a debit card or charging the purchases on a credit card? If the latter, be sure to factor in the costs and advantages you may have by using the card, including rewards points.
Now that you’ve finished your back-to-school shopping homework, you can make the experience a positive one for you and your family! 

Links marked with * go to a third-party site not operated or endorsed by Arvest Bank, an FDIC-insured institution.
 
Tags: Budgeting, Cash Management, College, Financial Education, Savings
 

It’s All About Cash Flow – Until It Slows Down …

Wednesday, January 13 at 08:05 AM
Category: Business Banking

In the agricultural economy, producers are experiencing varying levels of success across the broad spectrum we have in Southwest Missouri. Two extreme examples are seen in the cattle and crop sectors. Cow-calf producers are seeing strong margins with continued support in the cattle futures and lower feed costs. Meanwhile, crop producers have seen profits reduce significantly due to lower prices following the large fall harvest of 2014 and significant inventory carryover. This is the nature of agriculture.  

Cash flow is directly tied to the profitability of a given producer in any industry. When margins are strong, cash flow is strong. When margins are weak, then cash flow follows suit. Successful producers anticipate these fluctuations and prepare accordingly. While there are a number of financial areas that need to be evaluated, the most important one in times of thin profits is working capital.

Working capital is defined as current assets minus current liabilities. Current assets (cash, receivables, inventories, prepaid expenses, cash invested in growing crops, etc.) are the items that are cash or can be converted to cash within 12 months. Current liabilities (accounts payable, line of credit, lease payments, interest payments, principal payments on term debt, etc.) are the obligations that must be paid within the next 12 months. So, working capital provides a quick look at what resources a producer has to meet their obligations in the near term. And, it serves as the primary backstop for weak cash flow.

In the past several years, many grain producers had the opportunity to build up and protect working capital when prices were running at their historical highs. Unfortunately, the temptation to use this ‘excess’ cash to purchase equipment or real estate was too strong for many. And, as a result, working capital was depleted, leaving reserves less robust than they should be given the recent decline in operating margins.

Cattle producers should watch and learn from their counterparts in the grain industry. They are facing similar temptations to expand their operation by purchasing additional cattle, equipment or land with ‘excess’ cash. While this could be a prudent move resulting in enhanced profitability, producers can’t predict when a down turn in cattle prices may come. So, producers should consider reducing or eliminating dependence on accounts payable or lines of credit before paying cash for capital purchases. Doing this will help ensure that there are enough working capital reserves to shore up weaker margins in the future.

Having said this, not all working capital is created equal. A positive working capital number does not automatically mean they won’t have problems with cash. For instance, if the majority of a producer’s assets are in marketable inventories (calves, crops, etc.), then the timing of when these products are sold comes into play. For instance, it wouldn’t be uncommon this year for a grain producer to have contracted their corn for delivery at a later date to try to get a better price. While this may result in a profitable sale, he may experience a cash flow crunch while trying to make loan payments or pay fertilizer bills that are due in the meantime.  

To help anticipate when shortages may occur, it might be beneficial to use a calendar to ‘map’ out when expenses and payments are scheduled and compare this to when inventories will be (or should be) marketed. Many producers track these things in their head – which works well enough when margins are strong. However, when profits are tight, there will be less excess cash flow being generated from the periodic sales. So, it becomes vitally important to keep track of when the potential shortfalls could occur and to plan accordingly.

In summary, it’s true that cash flow is the lifeblood of any business – agricultural or commercial. When margins shrink and the flow slows down, then the business’ reserves may be needed to fill in the gaps. It’s been said that ‘equity doesn’t pay the bills’, which is so true. The primary stopgap measure a producer has is working capital. So, make sure you’re preserving this resource in both good times and bad – because no one knows what the future may hold.
 
Tags: Arvest Biz, Business Banking, Cash Management
 

ECKAN – Our Partner in Fighting Hunger

Friday, September 19 at 05:20 AM
Category: Arvest Community News

In 1966, East Central Kansas Economic Opportunity Corporation (ECKAN) was formed to address the causes and conditions of poverty at an individualized community level. The organization stemmed from legislation passed through President Lyndon B. Johnson’s War on Poverty efforts. ECKAN is headquartered in Ottawa, Kan., and employs 100 staff across nine counties in east central Kansas. Last year ECKAN had more than 6,000 volunteer hours donated to the agency.

ECKAN’s* mission is, “To identify and focus available resources that enable eligible families and individuals to attain critical skills, knowledge and attitudes necessary to achieve self-sufficiency.” Its core programs help families overcome poverty and the need for public assistance. ECKAN is unique in its ability to tailor programs specifically to the communities it serves, in addition to offering well-known assistance programs such as Head Start, Weatherization, and the HUD Section 8 program.

ECKAN’s Community Centers also provide emergency food assistance to families living in those nine counties and distributed over 9,000 units of emergency food assistance last year. In Franklin County alone, weekly food distributions serve 90-100 individuals. The agency also provides a Summer Lunch Bunch program in an effort to alleviate food insecurity among children ages 1 – 18 during the summer months when school breakfast and lunch programs are not an option.

All these programs meet a critical need linked to the food insecurity rates as identified by Feeding America’s Map the Meal Gap (2012) in ECKAN’s service counties. Two of these counties have food insecurity rates higher than that of the state as a whole (14.8 percent).

Those interested in volunteering may do so at many of ECKAN’s locations. A variety of opportunities exist, such as working at community centers assisting with food distributions and volunteering in Head Start classrooms. Individuals interested in volunteering should contact ECKAN’s central office at (785) 242-7450 and ask for Jake to learn more about current opportunities.

To learn more about 1 Million Meals, visit arvest.com/millionmeals.

You can make a donation through any of the following methods:

  • Donate via Phone – Customers can make a $1 (or more) donation by calling (866) 952-9523.
  • Donate via Mail – Mail a check to Arvest Bank Operations, ATTN: 1MM, PO Box 799, Lowell, AR 72745. Include 1 Million Meals in the memo line of the check.
  • Purchase a Paper Can – Purchase a 1 Million Meals paper can for $1 at any Arvest Bank branch. Each paper can purchased funds five meals. Donations of larger amounts also accepted.
  • Drop Off Food Items – All Arvest Bank branch locations will be accepting nonperishable food items. Donated items will be delivered to local food partners for distribution.

Arvest will donate on your behalf if you:

  • “Like” or "Share" a 1 Million Meals post on Arvest’s Facebook page.* Arvest will donate $1 on your behalf for every Facebook "like" or "share," resulting in five more meals toward the overall goal of one million meals.
  • "Follow" Arvest on Pinterest. If you follow Arvest Bank on Pinterest,* then Arvest will donate $1, which equals five meals, on your behalf.
  • "Retweet" our 1 Million Meals tweets from @ArvestBank* on designated promotion days – Sept. 19 and Oct. 10. For every retweet on those days, we’ll donate $1, or five meals, to your neighbors in need.

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

Tags: 1 Million Meals, Cash Management, Charitable Giving, Kansas City
 

Seven Steps to Spring Clean Your Finances

Wednesday, April 23 at 09:30 AM
Category: Personal Finance

The season for spring cleaning has arrived and while many may be focused on organizing closets or scrubbing floors, Arvest Bank encourages consumers to clean up their finances, as well.

Here are tips to help our customers cut back on financial clutter this spring:

  • Evaluate and pay down debt. Take a look at how much you owe and what you are paying in interest. If there are better rates available now, consider requesting a lower credit card interest rate or refinancing your mortgage. Begin paying off existing debt, whether that’s by chipping away at loans with the highest interest rates or eliminating smaller debt first.
  • Review your budget. A lot can change in a year. If you’ve been promoted, had a child, or become a single income household, be sure to update your budget. Determine what expenses demand the most money and identify areas where you can realistically cut back. Develop a strategy for spending and saving and stick to it. 
  • Check your credit report. Every year, you are guaranteed one free credit report from each of the three bureaus. Take advantage of these free reports and check them for any possible errors. Mistakes can drag down your score and prevent you from getting a loan, or cause you to pay a higher than necessary interest rate. 
  • Sign up for e.statements and paperless billing. Converting to paperless billing will help keep your house, physical and financial, more clean and organized.
  • Set up automatic bill pay. By signing up for automatic bill pay, you’ll never have to worry about a missed payment impacting your credit score. You can set it so that money is withdrawn from your checking account on the same day each month.
  • Consolidate your accounts. Managing several accounts can be challenging. If you have open accounts that you rarely use, then consider closing them. It’s important to note cancelling accounts may come with a fee or impact your credit score. Other options include streamlining all your accounts under a single bank, or using a bill management service that allows you to view all of your financial accounts, bills, subscriptions and travel rewards in one place with a single password.
  • Download our mobile app. We now offer mobile apps for iPhone, iPad and Android devices that allow consumers to manage their finances from the palm of their hand. With the click of a button, you can make a deposit or access a record of all your recent transactions.

Spring is a great time to take a hard look at your finances and identify ways to manage them more efficiently. By getting your financial house in order, you can set the stage for a stronger, more successful future.

Article courtesy of the American Bankers Association.*

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

Tags: Cash Management
 

New Year, New Savings Approach

Friday, January 03 at 01:05 PM
Category: Personal Finance

Strike up a conversation about retirement with someone in their early working years and their thoughts often can be read plainly on their faces. It’s as if they’re standing at one end of the solar system and being asked to spot a galaxy 100,000 light years away and being asked to plan for how they’re going to get there. It seems unreachable, unknowable for now. They’ll figure it out later.

Unfortunately, later doesn’t work too well. The longer we put off saving for retirement, the more risk we take in not having enough assets as that once-obscure galaxy comes into view. Starting a disciplined saving routine is less painful than it sounds, and a new year is as good a time as any to begin.

The most practical way for most people to start saving is through an employer retirement plan. It might be a 401(k). It could be a 403(b) or a SIMPLE IRA. There are other employer retirement vehicles, but these are the most common ones that allow the employee to contribute his or her own money.

Employers want workers to participate in these plans because they know it promotes worker satisfaction and, hopefully, more productivity and less turnover. So most companies match part of the employee’s contribution. For instance, several Fortune 500 companies kick in an amount equal to as much as 6 percent of pay as long as the associate contributes that much. The account owner has doubled his money before it’s ever invested.

The government also encourages retirement saving by allowing contributions to be made from earnings without being taxed. Then all growth and income generated inside the account go untaxed until withdrawals start in retirement. Ideally, those funds will be coming out at a time in life when a person’s tax bracket is lower than when he was working full time.

How much money will be needed in retirement depends on each retiree’s spending and big-picture goals. A financial advisor can help with that kind of planning. The advisor’s advice when it comes to saving typically is going to be to take advantage of the employer’s match at a minimum and to do more over time.

As nice as the IRS is in allowing pre-tax contributions, that generosity is limited. The most that can be deferred into a 401(k) in 2014 is $17,500 for anyone under age 50. At 50 and older, an additional $5,500 catch-up contribution is allowed for a total of $23,000 a year.

People whose employers don’t offer a retirement plan can use either a traditional IRA or Roth IRA. Which one is more appropriate depends on several factors that a financial advisor or tax advisor can help you determine.

A few generations ago, the retirement-funding recipe usually consisted of an employer pension, Social Security and personal savings. Now, pensions are rare and Social Security isn’t enough by itself to make ends meet for most. The importance of personal saving is greater than ever.

And delaying can be expensive. Assuming 6 percent annual compounded growth, an investor who saves $6,000 a year starting at age 25 will accumulate $754,741 by age 60. Waiting to start until age 35, that figure drops to $374,689. Waiting to start until 45, the total is $162,414.

So start now. Start with something. Even if it’s a token contribution, do it so it becomes a habit as you move into your higher-earning years ahead.

Tags: Cash Management, Financial Education, Investing

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