Tag Archives: save

Your Child’s First Savings Account – What to Know

Your Child’s First Savings Account – What to Know  

Saving is a skill that will serve you well at any point in your life. It is extremely important to introduce the concept of saving and budgeting to your children early on in life. Opening a savings account will not only help with teaching them this concept but will begin their savings journey. Keep reading to learn about what you need to know when opening your child’s first savings account. 

At What Age Can My Child Have a Savings Account? 

A child can generally have a savings account at any age. Yes, your child as a baby can have their own savings account. As their parent or guardian, you are able to open and manage their account until your child is old enough to manage their savings account on their own. 

What Should I Know When Opening a Savings Account for My Child? 

Opening a savings account is really no different than if you were to open a savings account for yourself. As you would for your own account, you’ll need identifying information as well as basic information for both you and your child as you will essentially be in control of their account.

How Can a Savings Account Teach My Child Good Savings Habits? 

Prioritizing savings early on will only serve your child well as they grow. Opening a savings account early on allows you to add to it for them as they earn money to begin saving. When your child is old enough to understand the account is their own, they will be able to see how the account has grown and begin being a part of depositing to their savings account. When your child begins learning the concept of saving and budgeting, allow them the opportunity to add money to their account. This is a great time to introduce savings goals with them and potentially set rewards, such as getting to make a purchase for a set amount or you choosing to match their contributions. 

Should My Child Be Using Mobile Banking? 

If your child is at the age of using their accounts to make regular purchases, it is a good idea to introduce mobile or online banking as a tool for them to check their financial standing. This is also a good tool to begin and practice budgeting. Giving your child the opportunity to manage and track their spending will allow them to have more at stake and feel more involved in their finances. 

Does My Child Need a Debit Card? 

If your child is at the age to be able to operate a debit card, it is a great option to practice their saving and spending while tracking everything with their mobile app. If your child chooses to open an account or get a debit card, as a parent you will have control of these and need to be involved in the opening process, as well as set spending limits and such. 

What Savings Account Should I Open For My Child? 

At FSSB, we are happy to help you and your child begin your savings process. Please stop in to discuss options or visit our website to browse our savings account options available to children. 

Prioritizing savings over spending is such a valuable lesson, get your child started with their savings account at FSSB today!

Don’t Overspend This Holiday Season: Steps to a Better Budget

Don’t Overspend This Holiday Season: Steps to a Better Budget  

Summer has flown by and that means the holidays will be here before we know it. Setting a budget is crucial for not overspending during a very expensive time of year. Start saving and setting your budget now so that when the holidays arrive you aren’t scrounging to stay within your budget. Here are the top steps for creating a budget for the holidays, as well as some savings tips. 

Step 1: List Out Your Known Holiday Expenses 

Your best strategy to avoid overspending is to set and stick to a holiday budget. It is very important to list out early your known holiday expenses and remember the spending doesn’t stop with gifts. Plan for hosting, food, entertainment, holiday activities, decorations, travel, donations, cards, wrappings, stocking stuffers, work Christmas parties, or anything you typically spend money on during your holiday season. 

The process of creating your holiday budget is similar to your household budget – list all expenses and add them up. Seeing this total, you can evaluate if it is within reach or if you need to tighten up your budget. As you shop this is a list to refer to and decipher how much to spend on each item as you check off your list. 

Step 2: Set Your Spending Limit

The most important step is to identify how much you can afford to spend and set your spending limit. This amount should come out of cash or savings to avoid relying on debt. Look at your list of holiday expenses and remove items, if at all possible, and compare what you’ve totaled up to the money you have set aside for holiday spending. If your total is within reach, this is a time to be creative with how to save a little extra over the next few months to continuously set aside money for your holiday budget. Here are some ways to save extra:

  • Buy gifts early and on-sale
  • Shop Black Friday
  • Sell some things
  • Pick up a side hustle
  • Cut back on buying wants 
  • Reduce social spending
  • Tighten your budget up and send additional savings to your holiday fund
  • Take a holiday job

Step 3: Number Your Priorities

The holidays can be overwhelming if you don’t plan in advance, set your spending limits, and save, save, SAVE! To relieve some holiday anxiety, set your priorities and do not feel bad doing so. If your expense list seems to be long, it’s ok if you can’t afford every single item, that’s where your priorities come in. Go through your list and assign each item a number based on its importance. Rework your list, putting your high-priority items at the top. Your high-priority items should be the first you save for and purchase. 

For example, suppose you decide that purchasing gifts is your top priority, while new holiday clothes for yourself are a low priority. As you work out your budget, you would allot more items to your gift fund than your clothing fund, possibly even waiting to purchase clothing until gifts are all purchased, and you have room in your budget. 

Step 4: Re-Work Your Budget; Allocate Funds

Allocating your funds is figuring out how much money to put towards each item on your list. Examine your list to roughly estimate how much each item costs and how much you plan to spend. Keeping this list realistic and projecting costs to be higher will keep you within your spending limit. If you have 20 gifts to buy, budget for each of these gifts at a doable cost. 

Step 5: Check in On Your Holiday Savings and Budget

When you have added up the amounts you’ve allotted for your items, be sure this equals the total you set as your spending limit. If it doesn’t match up, this is the time to rework your savings plan or lower the budget for one of your priorities. Consider scaling back on activities or even how elaborate your holiday party may cost. This is where you can reference your numbered priorities list and see what can be rearranged to keep you within your budget. 

As you begin to shop and plans change, KEEP TRACK. Keep notes of expenses and receipts to know where you stand on purchases and stay within your desired spending limit. Don’t risk blowing through your budget by simply being unorganized or overspending. If it makes it easier, open an account specific to holiday spending to help you keep track of how much you’ve spent and to reference the cost of items as you shop. You also could create cash envelopes to keep priorities separate. 

There are several ways you can get ahead on holiday spending this year! The best thing you can do is start planning and saving now – you’ll thank yourself for a great financial start in the new year!

How To Save On Your Taxes

calculator

Are you kicking yourself for how you handled last year’s taxes? You can feel better about next year by learning a little bit about tax savings now. 

Consider Donations

Not only is donating to charity a great way to give back to the community, but it is also a smart way to have a tax write-off. It needs to be a charity that is recognized by the IRS in order to do this. This will require some organization on your part over the course of a year. You will be required to have written records. It should say the date of the contribution, the amount you gave and to who. If the amount is over $250 and you don’t have a receipt, the IRS may reject it. 

Increase Contributions to Your Retirement

If you contribute to a 401(k) plan or an individual retirement account, you can reduce your income tax. You would need to increase the amount that is withheld from your paycheck automatically.

Start Saving for Your Child’s College Tuition

It’s never too early to start saving for your child’s education. A 529 is a college savings plan similar to an IRA except it’s for college. The contributions grow tax-free, and withdrawals are not taxed for a college education. You can either use this for your children or for yourself to take a fun college course in retirement. 

Review Tax Credits for Children

Having children is incredibly expensive. Double-check that you’re getting all of the tax credits you qualify for. You can itemize medical and dental expenses. As we all know, these costs don’t come cheap. Whatever you are paying out of pocket for these costs may be itemized along with the child tax credit. 

Begin a Health Savings Account

To help decrease some of the common stress of medical bills, consider starting a health savings account. Contributions made to an HSA are pre-tax dollars that can be applied to medical expenses. If you contribute the maximum amount, you can potentially save thousands on your taxes this year. 

It is possible to pay less in taxes next year, you just need to put the work into finding some ways that you qualify for exemptions. For more ways to save, contact us at First Security State Bank.

How to Save for Your Dream Vacation

vacation

From sunny beaches to tall mountains, everyone has their own version of a dream vacation. But how do you save enough cash to go? It’s important to see the world and take in all it has to offer, which is why First Security State Bank has come up with these tried and trusted ways to save for your dream vacation.

Timing Is Key

Instead of taking off 5 whole days of work, is there a week where you can travel to include a weekend and a holiday? This automatically gives you a three day start to your vacation, with no time having to be taken off yet! You can also factor in the time of year, as plane tickets and places to stay can be cheaper during some months over others. This can easily save you hundreds right off the bat.

Cut Back To Necessities

There are plenty of things you don’t need to be spending money on each month. Stop getting your nails done, buy generic brands instead of brand name, eat out less and drop some memberships. You don’t need ANY of those items, so cut them out of your life and put all of that savings towards your vacation fund!

Airbnb It

Airbnb has phenomenal prices compared to hotels in some areas. Instead of paying $200 a night, you can pay $60. This also allows you to be able to bounce around to different places in the country you choose to explore, instead of being tied down to only areas that have hotels. There are also plenty of alternatives to Airbnb, so check them out to see what they offer!

Download A Budgeting App

An app can help you stay on top of your savings game while trying to rack up money for your trip. Of course, while these apps have cool features, like the capability to set financial goals or save toward a single event – like your vacation – it’s still up to you to make it happen. Some apps include: Mint, Acorns, Pocket Guard, Albert and Wally.

Travel During The Off-Season

Going when everyone else normally doesn’t travel is a perfect way to save! Even though it’s the off-season, you’ll still be able to explore all the beautiful landmarks and places you want to see. Lots of places are always warm, so traveling at a different time than you originally wanted won’t hurt your chance to soak up the sun.

We hope these tips help you start saving for your big trip! Getting out and exploring the world is so important, so we want to help in any way we can. Open a savings account with us today to help keep your vacation fund safe!

4 Frugal Ways To Save On School Supplies

school-supplies

School is back! While you’re working on gathering those school supplies, be sure you aren’t overspending on some of the essentials. We’re here to give a little advice on ways you can save on supplies, while making sure you still get everything on the list.

Re-use

Start by shopping at home. You have drawers full of unused highlighters and almost-new pencils. Yes, your child may whine that they NEED the new 144 pack of crayons, but they will be just fine with the boxes you’ve accumulated over the years. Search through your crayons and find the newest ones and make your own box. Then find the notebooks, scissors and pencil bag from the year before to add to the pile.

Coupon It

Coupons are everything! Find the best deals online by adding a store’s app to your phone or simply search the web. Know when the best time to go shopping is for those supplies and grab your coupons. You can also bring your child along to teach them the value of saving and how those 2 for 1 deals work!

Go Generic

You don’t need to buy the $2.50 folder when you can buy almost the same one that’s a generic brand for $0.49. Knowing what items don’t need to be splurged on can save you some cash here and there – and quickly build up if you have more than one kid!

Follow Stores Online

Following stores online and subscribing to their email list may let you get ahead of the game. Stores sometimes have flash sales or extra coupons on their social platforms for devoted customers, so scoping it out won’t hurt! If you plan to bargain-hunt this year, monitor your favorite stores’ Twitter and Facebook feeds to find deals.

You can follow these stores on Twitter, for example:

  • Amazon Deals: @amazondeals
  • Coupons.com: @Coupons
  • Staples: @Staples
  • Office Max: @OfficeMax
  • TJ Maxx: @tjmaxx
  • Marshalls: @marshalls
  • Best Buy: @BestBuy
  • Target: @Target
  • Kohl’s: @Kohls
  • RetailMeNot: @RetailMeNot

We hope these simple solutions allow you to save a little here and there. Those small savings add up in a hurry, so take saving for school supplies seriously! Then, put those savings into an account for your child, so they can use it for college later.

How Much Do We Need to Save For a Baby?

baby-savings

You won’t be surprised to hear that the baby industry is thriving and has been for some time. The more knowledge that is gained about baby safety, development and the overall rising costs of education has left some hesitant to start a family. However, with a little planning, you can determine the most important things you want to provide for your child and go from there! We’ve compiled a list of main essentials for you to consider but realize this can be different for every family.

Pregnancy, Delivery and Pediatrics

Even before baby’s debut, the costs can rack up rather quickly. You are going to want to be sure to check with your insurance company to see what you would be paying out of pocket for prenatal visits, delivery and follow up visits. You’ll also want to see how the coverage changes in the unlikely scenario you have a multiple pregnancy, like twins or more.

Average Prenatal Costs: $2,000

This includes routine doctor’s appointments and even prenatal vitamins. Many insurance companies cover the costs for a majority of this. However, keep in mind that every pregnancy is different and you may sometimes be referred to a maternal health specialist.

Average Cost of Delivery and Newborn Care: $4,000-$50,000

This amount varies so much due to the type of delivery you have and if there are any complications.

Average Cost of Pediatric Care in the First Year: $688

This includes well-baby visits and immunizations. It should also be noted that it does not include any specialized doctors should your child need them.

Baby Supplies

The bad news is that baby supplies cost a lot, but the good news is it doesn’t have to break the bank. Many items that parents think are a “need” are really more of a want and not critical to the well-being of your little nugget.

Baby Gear: $400-$3,000

There are certain items that you should not get secondhand, like a car seat. However, you can keep your baby gear costs down by purchasing many items secondhand. When it comes to toys, children are often entertained by items as simple as measuring cups! Get creative with your purchases.

Nursery: $400-$2,000

Even if you don’t plan on having a completely redecorated nursery, there are some basic items you will need to get. This includes a crib, mattress, bedding and potentially a changing table.

Diapers: $1,000 (1 year)

There’s no getting around it, you are going to need diapers and a lot of them. Even if you choose to go the cloth diaper route, the cost of those supplies can easily cost $300-$500.

Clothes

Clothes is one area where you can seek out secondhand options. You may want to have a few outfits for special occasions that you love, but simple white onesies do the trick!

Maternity Leave & Child Care

Unfortunately, not all companies offer paid leave to employees. You will want to figure out what your company offers and how long you would like to take to stay with the baby. Sixty percent of Americans qualify for the Family Medical Leave Act, which grants you up to 12 weeks of leave. You will want to factor in any salary you are missing out on as a cost to you.

Child Care: $5,000-$24,000 per year

If you plan on having full-time child care, you will also want to start shopping around for places in your area. Many times, the best places have long waiting lists. You are going to want to make a budget to see what kind of care you can afford or if you have a family member who would be willing to help out.

Take your time to evaluate each of these costs. It’s important to consider all of these expenses so you don’t have to stress before baby arrives and after! Save for baby and place that savings in a secure area – like a savings account from us!

6 Ways to Travel Like a Minimalist and Save Money

save

If you’ve been putting off travel because you think it’s too expensive, think again! The new minimalism trend is taking off – more than the tiny houses you’ve seen. They are proving to be a helpful mindset and strategy for travelers. Here’s the inside scoop of how to cut costs on your next trip.

Plan, Plan, Plan

One undervalued trait that minimalists have is the ability to plan ahead. As enticing as a spur of the moment trip may be, that can often lead to even more unexpected expenses. When we say plan, we mean plan and then plan some more. Be on the lookout for the greatest deals and the best time of the year to travel, even down to what day you purchase flight tickets.

Pack Light

A hallmark of a true minimalist and saver is less is more (money). Aim to have only one carry-on bag, even if your trip is going to be a few weeks. You will be able to go to a laundromat or clean your clothes at your lodging. This can save you hundreds of dollars. Many times, we often don’t wear or use half of the items we bring with us on vacations. Choose comfortable and climate-appropriate clothes. If you are crunched for space, consider this technique for maximum space.

Utilize Public Transit

Instead of renting a car, take advantage of the local bus or rail system on your trip. If you are looking to travel in Europe, this is especially easy to do! The trains are reasonable and can get you practically anywhere. Not only is this an economical choice, but it is an even better way to really get to know the area you’re visiting.

Go Natural

This ties into traveling light, but if there is any time to really let go, it’s on vacation! Leave all of those hair products and perfumes behind. Just enjoy the experience of a minimalist traveler. Now you can spend more time having fun!

Rethink Traditional

When you think of travel accommodations, the hotel may be the first thing to come to mind. Although hotels have their perks, it may be less expensive to find an alternative option. Hostels and personal rent-a-room services are easily an affordable option. Leave what you thought cheap lodging was behind – people are really vamping up their spaces to have a more personable hotel-feel.

Sweet Memories Over Souvenirs

Go with excitement and leave with only memories and photos. Often times, souvenirs are trinkets left on a shelf for years before finally disposed of. How much nicer would it be to have a hundred pictures and memories to hold onto? This will also save you space on your trip back! Remember, we are thinking minimalism here, so it’s important to stress the value of experiences over things.

When you’re traveling this season, allow us to help you keep your money safe in order to save up for your big trips to come!

Saving For Retirement in Your 30’s

retire

Congratulations, after your roaring twenties, you have made it to the thriving thirties. Unfortunately, with another candle added to the cake comes another responsibility. People in their thirties have a very high amount of expenses from a house payment to the cost of little ones, which is why we wanted to offer the following solutions to saving.

Automate Savings

You have hopefully already begun a savings account for the other financial goals in your life. If not, no worries! You’ve likely decided that this needs to be a priority now, or you wouldn’t be reading this blog. A simple way to start is to set up a percentage to be automatically put into a 401(k).

Many employers will automatically do this for you with each of your paychecks. If they don’t, this is something you will be able to set up on your own, so you don’t accidentally spend the money instead of investing in your future! If they already do this for you, consider increasing the amount even more.

Compound Interest

You’ve probably been saving for retirement since you became an adult, right? We would be very surprised if you did! A majority of Americans in their 20s and 30s have less than 10k saved towards retirement. If you’re late to the party, that’s okay! If you are thirty now, you still have until you are 65 to gain compound interest on your savings. Saving a little now will grow tremendously over the next thirty-plus years.

Don’t Cash Out

You’ve probably been working for a while and have had a few different jobs. Even more likely, you will have more than one job within the next twenty years. A hard rule of thumb is to never cash out of your retirement plan when you switch employers. The money may be enticing, but it is crucial to roll it into your next retirement account to avoid the fees of withdrawing early. If you roll the money into a new account, it can be worth ten times the amount come retirement.

Keep Your Eye On That Golden Sunset

We understand you have many responsibilities you are managing daily. It can be difficult to picture retirement when you have so many other things or people fighting for your attention. However, retirement will come and the responsibilities will dissipate if you plan correctly. Try to not let the urgent things of today take priority over the important things of tomorrow. Instead of splurging on that brand new car, consider buying used and put extra money away for your golden years!

If you need help planning for your retirement, come see us at First Security State Bank for guidance! We have numerous solutions to help you save for the future.

Saving for Tuition 18 Years in Advance

tuition

After you get to see those little eyes open, it’s like a whole new world has unfolded before you. When you’re elbows deep in changing diapers, cleaning up whoopsies, and trying to sleep more than four hours a night, the last thing on your mind is college savings. At First Security State Bank we understand the chaos which ensues with each new addition to your family. To help you prepare for this upcoming transition, we’d like to help you find the best educational savings account for your little bundle of joy before he or she arrives!

There are two primary types of accounts when it comes to saving for your child’s ongoing education. Similar to retirement savings accounts, both of these options do require various stipulations when it comes to distributing the saved funds. Here we’ll show you the pro’s and con’s of each option, to help you better determine which option will suit you and your needs best.

The Coverdell Savings Account: This account option utilizes after tax dollars, which means there are no taxes on distributions when the funds are used for education. The account does have a nationwide $2,000 a year contribution limit, in addition to various income restrictions. While you and your spouse may manage and contribute to the fund, once the child turns eighteen, he or she will own the account and all the funds within it.  However, the child once of age, may only use the funds for education related expenses without incurring additional distribution tax.

The 529 Savings Account: This account option also utilizes after tax dollars, which again indicates no future taxes on distributions if the funds are used for education. The account does not have income limitations, however each state stipulates their own total contribution limit, typically ranging from $100,000 to $350,000.  For this account type, the physical savings account, and the funds within it, remain yours, only designated toward a specific beneficiary (which you can change up to once per year.)

Let’s compare the two when looking at national average college costs across the U.S.

If you choose to save using the Coverdell account option, suppose you save $2,000 per year for eighteen years, yielding a total of $36,000 of total out-of-pocket contributions. Add in the compound interest of those eighteen years, and you’ll find yourself with approximately $80,983 in total educational savings. Fun Fact: The national average for a year of in-state public college in the U.S. is $20,090 or $80,360 for a four year degree.

Alternatively, if you choose to save with a 529 account, you can save more than $2,000 per year, say $3,500 per year instead. Multiply those contributions by eighteen years, and you’ll have $63,000 in total out-of-pocket contributions. After calculating your compound interest into the equation, you’ve grown up to $141,562 in total educational savings. Fun Fact: The national average for a year of any college in the U.S. is $35,370, or $141,480 for a four year degree.

As you can see, both of these accounts allow you to make much more through the benefit of time and compound interest. Just like your retirement savings, the sooner you start contributing, the more interest you can earn. While the Coverdell allows you to give the account to your child, the 529 shows better savings opportunities, allowing you to maximize your potential interest.

If you’d like to learn how you can start saving for your upcoming chick-a-doo, stop by and speak with one of our dedicated personal bankers at First Security State Bank today! We’d love to help your family continue to grow!