Taking Steps Towards Financial Improvement For The New Year

The start of a New Year is a wonderful time to make important changes in your financial life. And you don’t have to go it alone. Here are some tips on financial improvements you can make starting now. And know that Freedom Federal Credit Union will be here with you every step of the way.

We’ve broken down some of the most popular financial resolutions into concrete steps and outlined the ways Freedom can help you implement each change into your life.

Build a Budget

Why it’s crucial: Creating and sticking to a monthly budget will force you to be accountable for your spending while giving you a clear idea of your financial reality.

In 3 steps:

Track your spending over three months.
Using a spreadsheet, or a personal finance app like Mint, divide your expenses into categories, such as mortgage, auto, groceries, entertainment, etc. Use an average of the last three months to set a reasonable spending limit for each category.
Going forward, track your spending and be sure to stick to your preset limits for each category.

If your budget reveals your monthly income doesn’t cover your expenses, or you find you’re overspending in any area, look for ways to cut back.

How Freedom can help: Stop in at any time to speak to a Financial Service Representative for help with managing your money. We also offer our members great online budgeting software and financial educations tools, absolutely free.

Get Out of Debt

Why it’s crucial: Carrying long-term debt can often mean paying extremely high amounts of interest for years on end. It can also devastate your credit score.

In 3 steps:

Make a complete list of all your outstanding debts, in order, from smallest balance to largest.
Review your monthly budget and look for ways to cut back. Alternatively, you can look for ways to increase your monthly income.
Work on paying off your smallest debt with the money you trimmed from your budget. Once you’ve paid off that debt, move on to the second-smallest. Repeat until you’re completely debt-free.

How Freedom can help: If you’re carrying multiple high-interest rate debts, consider taking out a debt consolidation loan to simply things. This way, you’ll only have one low-interest loan payment each month. It may even reduce the total amount you’ll pay each month. If you prefer to pay off your debt more quickly without accumulating additional interest, consider a Balance Transfer. More information on these options can be found here.

Start (or Increase) Savings

Why it’s crucial: According to the Federal Reserve, 50% of Americans would have difficulty covering a $400 expense, with 19% of Americans simply incapable of paying, or 1 in 5 Americans. Living without a safety net means a relatively small, unexpected expense can throw off your finances and force you into debt. Aside for paying for emergencies, savings can help fund your long-term plans, goals and dreams.

In 3 steps:

Review your monthly budget to identify your biggest spending traps. Then, find ways to cut back, such as shopping with cash only, cancelling subscriptions you never use or initiating a “financial fast” one weekend each month, in which you spend no money.
Use all money saved to open an emergency fund and a long-term savings fund at Freedom Federal Credit Union. It’s best to focus primarily on your emergency fund until you have 3-6 months’ worth of living expenses stashed away.
Set up an automatic monthly transfer from your Freedom Checking account to your Freedom Savings account(s) so you can focus on your savings without thinking about it.

How Freedom can help: Freedom offers several options for Savings and Checking Accounts that provide excellent opportunities for growth. You can open an account today with an initial deposit as low as $1.00.

Maximize Your Retirement Contributions

Why it’s crucial: Many workplaces offer to match 401(k) contributions. These contributions aren’t taxed and they come off your paycheck, which is taxed, making participation an excellent decision.

In 3 steps:

Speak to an HR representative at your workplace to find out about your current 401(k) contributions.
Identify how to best maximize your 401(k) contributions going forward.
If you have any other retirement funds, such as an IRA or a Roth IRA, also review your contributions to determine if you are making the maximum funding allowed.

How Freedom FCU can help: Our Financial Service Representatives will be happy to help you determine the best course of action for planning your retirement. Let Freedom help you meet your financial goals this year.

On behalf of everyone at Freedom, we wish you a very Joyous and Happy New Year.

About Freedom Federal Credit Union

Freedom serves and is open to anyone who lives, works, worships, attends school, volunteers, or has family in Harford or Baltimore County, MD. As a credit union, we are committed to putting you first, not shareholders, and helping you achieve your financial goals. Learn more at freedomfcu.org or call us 800-440-4120 to see how we can help.

2021 Holiday Poem

‘Twas the holiday season and one that’s far different
As we try to stay positive and not be ambivalent
There’s been some bad stuff, but a lot of good too
With hopes for better times beginning to shine through.

Folks were keeping safe at work and in homes
Trying to stay happy despite all the unknowns.
And I working hard in my makeshift home office
Was looking for clues as to what this year might have taught us

When outside my window I heard such a clatter,
I sprang from my chair to see what was the matter.
I pulled up the blinds and lifted the window
Then leaned my head out to see what was below.

The light from the moon and neighbor’s decor
Cast a glow o’er the yard like I’d not seen before.
When what, in amazement, did these lights finally show,
But a rather large man, face down in the snow.

All I could see were the red clothes that he wore,
And it looked just like Santa, though I couldn’t be sure.
I ran quickly down to help, since he seemed so distraught,
But there was more going on than what I first thought.

As I helped him get up, I heard from my roof
The scraping and banging of numerous hoof.
I looked and saw reindeer, but not the usual eight
And as I hoisted him up, he said, “Man, we’re so late”.

“I’m down to five reindeer and two are the backups
Which is leading to more than just a few crack ups.”
I asked what had happened, why the reindeer depletion
And was it keeping him from his delivery completion.

“It’s sure slowing me down”, he said, “but that’s not the worst,
Everything’s been going wrong; it’s as if we are cursed.
First the reindeer got sick, then my sleigh lost some magic
And I keep falling off roofs, it’s really quite tragic.”

He went on to explain trouble with his ion shield,
Charged particles held together by a magnetic field.
He said it protects him from the heat on his flight
And without it he’d be just a fireball in the night

Then there was the drop in repulsive energy he’s using
Which compensates for gravity so he can keep cruising.
I was saddened to see him so dejected and down
And I’d never seen Santa’s face wearing a frown.

I pretended to understand though I was really quite lost,
But I knew I had to help him no matter the cost.
I assured him there was no curse and things would improve
He just needed some help getting back into his groove.

So I thought and I thought what it was I could do
I had no experience with this nor did anyone I knew.
Then I suddenly realized and became quite ecstatic
The answer was what Santa said, it was all about magic.

I said, “Remember who you are and what you symbolize
If you think long and hard I know you’ll realize
That the solution you seek is not some radical cure
It’s something more subtle and something more pure.

What drives you each Christmas and us through the year
Is the magic around us daily in all we see and hear.
It’s the love that we share, the laugh of a child.
he closeness of friends and the warmth of a smile.

It’s the kindness of strangers, the beauty of nature
That fills our souls knowing we’re part of something greater.
This then creates the magic we all need for your fuel
And makes everything right on this and every yule.

Santa then glowed with Christmas spirit and knew all was fine
His status back in intact with everything working in time.
He said, “I can’t thank you enough for the help and understanding
And patiently listening and my problem comprehending.”

So I got out my ladder but he just flew up to the roof
If I had any doubts he was fine that was my proof.
His ion shield began to shimmer, his repulsive energy sped
And the reindeer became focused on the journey ahead.

He said, “This Christmas day and every day after
Cherish the good times, the smiles and the laughter.
Make each moment count, don’t let things go unsaid
And may happiness be yours on the road yet ahead.”

Then he jerked on the reigns and the sleigh it did soar.
And I felt optimistic for what the future had in store.
Then he said with a laugh as he flew out of sight
“Merry Christmas to all and to all a good night.”

—

Mike MacPherson
President and CEO
Freedom Federal Credit Union

Is Inflation Here to Stay?

Q: It seems like I have to take out a second mortgage just to fill up the gas tank and restock the pantry. Are these inflated prices a forever thing?

A: According to the most recent report by the Bureau of Labor Statistics, U.S. inflation is currently running at a 30-year high of 6.2%, and it’s showing no signs of slowing.

Inflation is not going anywhere soon

Rising prices in just about every sector is the new norm. The inflation rate fell at the start of the coronavirus pandemic, and during the nationwide lockdown. In March 2021, though, when the impact of halted manufacturing began hitting the market and crude oil prices started climbing, the inflation rate increased to 2.6% before hitting its current high of 6.2% in October. Experts, like the Trading Economics information technology company, had predicted that number would be around 5.5%, but even that prediction fell short.

Unfortunately for the average consumer who’s struggling to cover expenses amid rising costs, this means inflation isn’t going anywhere soon.

Why are prices so high?

There are several factors for the inflation bubble. First, suppliers are still catching up on production shortages that were caused by factory shutdowns during the pandemic. Second, climate disasters, like California wildfires and a drought in Brazil, are responsible for driving up prices in the food industry. The demand for higher wages, partially caused by the 11 million job openings in the U.S., and the rising cost of gas, are contributing to inflation as well.

What can consumers expect in 2022?

While no one can accurately predict the future, economists are expecting inflation levels to taper off by the middle of 2022. According to a survey conducted by the Wall Street Journal, many are expecting inflation to drop to 3.4% by June 2022 and to continue falling until it hits 1.8% by the end of the year.

Your Turn: When do you think the inflation rate will fall? Tell us about it on Facebook, LinkedIn,Twitter, or Instagram @FreedomFedCU.

About Freedom Federal Credit Union

Freedom Federal Credit Union is a community-chartered federal credit union offering consumer financial services to those who live, work, volunteer, worship, attend school, or have family in Harford and Baltimore Counties. Additionally, Freedom offers a full-line of banking services for all businesses, associations, and other organizations that are based in Harford or Baltimore County. Freedom has been in business since 1953 and has six locations throughout Harford and Baltimore County. To learn more, visit freedomfcu.org.