Trends & Tips

Importance of Creating a Budget

budget iconWhether you’re living paycheck-to-paycheck or making millions a year, it is important that you budget your money. No matter how much you make, unexpected expenses or circumstances can cost your financial future and security.

Even though you can’t predict what obstacles life will bring you, you can stay ahead by preparing a personal or family budget.

Budgeting, which involves calculating your expenses and income over a set period of time, can help you take control of your financial future by allowing you to –

  • Set a course for your goals. For example, if you want to buy a home, having a budget will allow you to determine how much money you can save toward your goal and when you may reach it.
  • Determine where your money is spent. One of the biggest mistakes people make is not knowing how they spend their money. If you track your expenses with your budget each month, you’ll have greater control of your money and easily identify areas of waste or opportunity.
  • Build savings. If you know how much you earn and how much you spend, you will be able to determine the amount you can set aside for savings.
  • Prepare for emergencies. If you manage to carve out savings in your budget, you will be better equipped to handle any unexpected expenses that may arise.

But perhaps one of the biggest advantages of having a budget is that it can help you sleep better at night. You’ll know how much you have to spend, ensuring you don’t spend more than you have.

First County Advisors/Wealth Management, Trends & Tips

Newly Enacted Tax Reform Update

Jeff Action 526As the final details of the Tax Cuts and Jobs Act emerge from Washington D.C., we would like to share some of the key changes that will affect our customers in the coming year.  Changes regarding deductibility of mortgages, Home Equity Lines of Credit (HELOCs), as well as state and local taxes are found in the new law.  Highlights for individuals include:

  • The deductibility of interest on new mortgages is limited to $750,000 of principal. Existing loans made prior to 12/16/2017 will be grandfathered at the old level of $1,000,000.  The refinancing of grandfathered mortgages will also be allowed under the new law.
  • Interest paid on a Home Equity Line of Credit (HELOC) will no longer be deductible. The pre-reform level was $100,000.
  • The deductibility of state and local taxes, including income and property taxes, will be capped at $10,000 per year for Single and Married Filing Jointly taxpayers. Married Filing Separate taxpayers will be capped at $5,000.

Beyond the changes in deductibility of many items, the new law completely restructures the old income brackets and tax rates.  Generally speaking, the result is that most individuals will see their income taxed at a lower average and marginal rate.  The standard deduction will almost double for all filers.  In exchange for this increase, personal and dependent exemptions that were scheduled to be $4,150 per person for 2018 have been repealed.  Alternative Minimum Tax (AMT) exemptions have also increased substantially.

Another notable change is the increase in the child tax credit from $1,100 to $2,000 ($1,400 is refundable).  The phase-out for eligibility of this credit has been significantly increased from $75,000 (single) and $110,000 (married) to $200,000 (single) and $400,000 (married).

Estate/Gift/Generation-Skipping Transfer tax exemptions have been doubled for individuals, now $11.2M per U.S. domiciliary.   This means a married couple would be able to transfer a combined $22.4M to beneficiaries before any estate tax would be assessed.

What does this mean for Connecticut residents, as well as other high-tax states?

The impact of the tax law change will affect all taxpayers differently.  For filers that previously had itemized deductions well above the standard deduction due to high property taxes, state income taxes and mortgage interest, there is a good chance that their tax bill will increase a bit.  This is due to more income being subject to taxation.  The overall tax rate may be lower but it may not be low enough to offset the lost deductions.  This may also affect households with many dependents, due to the loss of the personal and dependent exemptions, again causing more income to be subject to taxation.  However, for many filers that had utilized the standard deduction, they will likely see a decrease in their overall tax bill.  It is important that all taxpayers consult with their tax advisor in the New Year to adjust withholdings on income in 2018.

 

*This article is intended to be used for education purposes only. Please consult your Tax Professional to see how you will be affected.

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Trends & Tips

Cyber Monday: Shop Safely

shutterstock_418009015 [Converted]During your online shopping on Cyber Monday, you will likely land on one of the many online retail giant’s shopping sites.  Here are some tips for shopping safely online.

  1. Type the URL into the address bar. Instead of just clicking a link to take you to your chosen retailer’s website, it’s safer to type the retailer’s URL into the address bar on your web browser. It may take a little more effort, but this simple action can help to prevent you from visiting a fake or malicious website.
  2. Credit Cards. Use the safest way to pay on the Internet – pay for your order using a credit card.  The safest way to purchase items via the Internet is by credit card because you can often dispute the charges if something is wrong.
  3. Trust your instincts. If you don’t feel comfortable buying or bidding on an item over the web, or if you feel pressured to place your order immediately, maybe you shouldn’t.
  4. Make sure the Internet connection is secure. Don’t trust a site just because it claims to be secure.  Before you give your payment information, check for indicators that security software is in place.
  5. Be cautious when responding to special offers (especially through unsolicited e-mail).

For more tips on how to shop safely, click here.

Trends & Tips

Black Friday Shopping: Credit Cards or Debit Cards?

creditcardsDuring the Thanksgiving holiday, many prepare for the madness of the following morning, Black Friday. While debit cards are a popular form of payment they may not be the best choice.

Credit cards have become one of, if not the safest way to pay for purchases. Using a credit card is safer than a debit card because it is not directly linked to a checking account and you can often dispute charges if something is wrong.

Here are a few situations on Black Friday, where you may be better suited to use a credit card:

  • Online. Since the debit card links directly to a checking account, don’t use a debit card online, you have potential vulnerability there.  Also included in the category are phone orders.
  • Big-Ticket Items. With a big ticket item, a credit card is safer. A credit card offers dispute rights if something goes wrong with the merchandise or the purchase. With a debit card, you have fewer protections.  In addition, some credit cards will also offer extended warranties. And in some situations, such as buying electronics or renting a car, some credit cards also offer additional property insurance to cover the item.
  • If You’re a New Customer. Online or in the real world, if you’re a first-time customer in a store, skip the debit card the first couple of times you buy.  That way, you get a feel for how the business is run, how you’re treated and the quality of the merchandise before you hand over a card that links to your checking account.
  • Buy Now, Take Delivery Later. Buying now but taking delivery days or weeks from now? A credit card offers dispute rights that a debit card typically does not.  But be aware that some cards will limit the protection to a specific time period. So settle any problems as soon as possible.

For more fraud protection tips, click here.

Trends & Tips

National Cybersecurity Awareness Month: Internet of Things

shutterstock_418009015 [Converted]As consumers buy more smart watches, activity trackers, holographic headsets, and other Internet of Things (IoT) devices, the need for improved security on these devices will become more pressing. Online criminals could exploit these new devices to conduct data breaches, corporate or government espionage, and damage critical infrastructure like electrical grids.

  1. Don’t connect your devices unless you need to.   The first step is to consider what functionality you need from the device. Just because your TV or fridge can connect to the internet, doesn’t mean you definitely want to hook it up. Take a good look at the features it offers and learn exactly what internet connectivity brings before you connect.
  2. Create a separate network.  Many Wi-Fi routers support guest networking so that visitors can connect to your network without gaining access to shared files or networked devices. This kind of separation also works well for IoT devices that have questionable security.
  3. Pick good passwords and a different password for every device.  It’s very important to pick strong passwords, but you must also make sure that you pick a different password for every device. If a hacker manages to get one of your passwords, they will typically try it with other services and devices. Reusing passwords is not a good idea. Use a password manager to keep track of all your passwords.
  4. Turn off Universal Plug and Play (UPnP). Sadly, UPnP can make routers, printers, cameras and other devices vulnerable to attack. It’s designed to make it easier to network devices without configuration by helping them automatically discover each other. The problem is that hackers can also potentially discover them from beyond your local network because of vulnerabilities in the UPnP protocol. Is best to turn UPnP off completely.
  5. Make sure you have the latest firmware.  If you want to make sure you have the latest security patches and reduce the chances of a successful attack, then you need to keep your firmware fully updated. Vulnerabilities and exploits will be fixed as they emerge, so your IoT devices and your router need to be regularly updated. Automate this wherever possible or set a schedule to check for updates every three months or so.
  6. Be wary of cloud services.  A lot of IoT devices rely on cloud services, but the requirement for an internet connection in order for something to function can be a real problem. Not only will it not work when the network is down, but it may also be syncing sensitive data or offering another potential route into your home. Make sure you read up on the provider’s privacy policy and look for reassurances about encryption and data protection.
  7. Keep personal devices out of the workplace.  Don’t take your personal IoT devices to work. There are lots of potential security concerns for wearables. Every enterprise should have a clear BYOD policy, and it’s often a good idea to prohibit personal IoT devices from connecting to the network, or at least limit them to a guest network.
  8. Track and assess devices.  Businesses need to track everything connected to the network and monitor the flow of traffic. Devices need to be assessed to determine the level of access they should have, to keep them fully patched and up to date, and to protect data end-to-end to preserve its integrity. Unknown devices should flag an alert. Understanding which devices are connected and what they’re doing is a prerequisite for proper security.

If you enjoyed these tips and want to learn more about Fraud Prevention & Safety visit our website by clicking here or visit: http://firstcountybank.com/efraud-protection.

Trends & Tips

National Cybersecurity Awareness Month: Mobile Banking Precautions

cybersecurity-mobileMobile banking offers account access with the same tight security measures as the full desktop websites counterpart. By following these steps, it is possible to make things much harder for criminals and to significantly lower your safety risks:

  1. Always use a pin or gesture code to lock mobile devices. If a physical device falls into the hands of a criminal, the first thing they should be faced with is security, particularly where access to finances and other data is concerned.
  2. Only use official routes to communicate with financial institutions.   Ensuring users stick to the official ways of contacting and receiving information from their banks is key. Mobile banking shouldn’t dramatically change the way banks communicate, so ignoring links to sites in emails requesting details, unusual texts or other messages, is advice worth noting when using a smartphone as it is when using a desktop PC, tablet or  laptop.
  3. Be aware of connection services.  Public Wi-Fi is far easier to ‘sniff’ for data than mobile data connections provided by a network operator. Unless the user is 100% sure of the security, or trust the connection on offer, think twice about dealing with personal finances over it.  Installing trusted security software, like Norton Mobile Security or Norton Tablet Security, will help prevent malware – the cybercriminal’s number one tool – from logging keystrokes or gaining access to a device. It can also scan emails to provide support in avoiding phishing attacks seeking bank account information.
  4. Be careful what you download.  It’s possible that mobile banking sessions could come under threat from code carried by other applications downloaded. While security software can scan for threats on a device, be aware of information entered onto a device and try to stick to well -regarded or official sources of applications or content.
  5. Read the fine print. Does your financial institution’s app allow you to delete all banking-related messages, pictures and other data saved on the phone? Can you disable the feature that automatically signs you in to your online bank account the minute your phone is turned on? Once connected to your account, will the app automatically disconnect after a certain period of inactivity?
  6. Set up your phone to encrypt data. Make sure your phone has an application to encrypt all stored data. Then, use it to protect sensitive messages from your financial institution and pictures of valid checks.  Photos of checks and other sensitive banking data may be stored on your phone’s memory expansion card. Even if the phone itself is secured with encryption, the card probably is not. Note that older phones may not have enough power to run encryption software.
  7. Download anti-virus software and enable firewall protection for your cell phone. Make sure to update it regularly.
  8. Never respond to email messages from your bank that request personal information. Banks or Credit Unions never ask for this information by email. Mark it as spam, and delete it. Next, delete all your cached content (sent messages, received messages, etc.) on a regular basis. Finally, check your browser security settings to help filter out phishing emails.
  9. Be skeptical about text messages. Before opening a text that appears to be from your bank, and especially before hitting “reply,” call your financial institution first to make sure the message is actually from them.

If you enjoyed these tips and want to learn more about Fraud Prevention & Safety visit our website by clicking here or visit: http://firstcountybank.com/efraud-protection.

Trends & Tips

National Cybersecurity Awareness Month: Data Breach Advice

cybersecurityicon-2Did you recently get a notice that says your personal information was exposed in a data breach? Did you lose your wallet? Or learn that an online account was hacked? Depending on what information was lost, there are steps you can take to help protect yourself from identity theft.

  • Be extra careful about emails and attachments.  Avoid clicking on links or downloading attachments from suspicious emails that claim to be updates from any company connected to a data breach. Learn More.
  • Use Two-factor authentication.  Two-factor authentication adds a second level of authentication to an account log-in. When you have to enter only your username and one password, that’s considered a single-factor authentication. 2FA requires the user to have two out of three types of credentials before being able to access an account. Learn More.
  • Check your Credit Cards accounts often.Reviewing your recent account activity is fundamental to credit card security—and it’s easy. You can do it online or by phone. If your credit card issuer offers email or text alerts about unusual activity, sign up to receive them.
  • Monitor credit reports. Check your credit report for any accounts that crooks may have opened in your name. Credit reports are available for free, from each of the three national credit reporting agencies — Equifax, Experian and TransUnion — every 12 months. Some monitoring services and credit card companies now allow you unlimited access to credit information, so you could theoretically check every day.
  • Know what to do if you suspect credit card fraud. Call the bank or financial institution that issued your card immediately. Your issuer may want to cancel your current card and issue you a new one. Check with your issuer to verify that your mailing address has not been changed.

If you enjoyed these tips and want to learn more about Fraud Prevention & Safety visit our website by clicking here or visit: http://firstcountybank.com/efraud-protection.

Trends & Tips

October is National Cybersecurity Awareness Month

cybersecuritytalkingpointsOctober is annually celebrated at National Cybersecurity Awareness Month. This is a great time for you to take a step back and assess your or your organizations efforts as it relates to cybersecurity. Throughout the month we plan on sharing tips that you can use to stay secure online.

For more information on National Cybersecurity Awareness Month you can search the hashtag #NCSAM or you can visit our eFraud Prevention & Safety section of our website by clicking here or visiting: http://firstcountybank.com/efraud-protection.

Trends & Tips

How to Talk to Your Kids About Money

talktokidsaboutmoney-iconHow soon is too soon to talk to your kids or grandkids about money? If they are old enough to ask for a toy or a bike, they are old enough to start learning financial lessons that will last a lifetime.

The best financial lessons are part of everyday experience. Look for opportunities to talk about money, read books aloud and play games that center around spending money wisely. Be open and honest when you discuss your financial experiences—good or bad.

Here are some examples of teachable moments to help you get started:

  • At the bank. When you go to the bank, bring your children with you and show them how transactions work. Get the manager to explain how the bank operates, how money generates interest and how an ATM works. Ask the manager for a tour—be sure to ask to see the vault.
  • On payday. Discuss how your pay is budgeted to pay for housing, food and clothing, and how a portion is saved for future expenses such as college tuition and retirement.
  • At the market. It’s easy to give clear examples of “needs” and “wants” using different kinds of foods at a grocery store. Milk (for strong bones) is a need; soft drinks are a want. Explain the benefits of comparison shopping, coupons and store brands.
  • Chores and allowances. Assign chores and give them a monetary value. Discuss ways to budget and divide allowances. Encourage children to set a financial goal, such as saving for a bike, and figure out how to achieve it.
  • Paying bills. Explain the many ways that bills can be paid: over the phone, paper or by check, electronic check or online check draft. Discuss how each method of bill pay takes money out of your account. Be sure to cover late penalties, emphasizing the importance of paying bills on time.
  • Using credit cards. Explain that credit cards are a loan and need to be repaid. Share how each month a credit card statement comes in the mail with a bill. Go over the features of different types of cards, such as ATM, debit and credit cards.
  • Browsing the Internet. While online, explain to your children how valuable their personal information and privacy is to you, to them and to online predators. Discuss the risks and benefits of sharing certain information. Then, as a family, make a list of rules for keeping personal information safe online.
  • Planning a vacation. Whether you are planning an outing to a local amusement park or a once-in-a-lifetime trip, emphasize the value of saving as a family. Set a family savings goal that involves your children. Figure out the cost and discuss ways everyone can help to reach the goal.

Always encourage your children to ask questions about money. If you don’t know the answer, research it together or ask your banker.

 

Smart Savings Tips, Trends & Tips

September is College Savings Month

moneygradcap-icon

The month of September is often a turning point for many – we welcome back pumpkin-flavored coffee, a new season of sports and of course, a new academic year. Annually regarded as College Savings Month, we will be using September to offer the latest tips and trends on how you can save – whether it’s your first or last semester.

Saving while in college can be as simple as having the right account. At First County Bank, we offer a variety of savings accounts. FirstPrize $avings may be the perfect fit for a college student. The account encourages you to save, by entering each eligible deposit into a drawing for $1,000!* Not only will this account instill the valuable lesson of saving each month, it can reward you for your efforts!

Stay on the lookout for more college savings tips throughout the month of September! If you’re interested in learning more about the FirstPrize $avings account, click here.

 

* Refer to http://www.firstcountybank.com/savings-account-disclosure for account official rules and disclosure.