WSB's Banknotes

Alert: Be Aware of Cyber Monday Scams - Nov. '24

Cyber Monday is on the horizon, and we would like to remind consumers to watch out for phishing and other identity theft scams this holiday shopping season. According to Forbes, in 2024, 20.1% of retail purchases are expected to take place online, but with $41 billion lost to e-commerce fraud in 2022, online shoppers need to be more careful than ever before.

Staying vigilant against the common social engineering tactics used by cybercriminals is the best way to protect yourself from becoming a victim of cybercrime. The following is a list of dos and don’ts to help you identify scams and avoid becoming victimized.

• Don’t save your card information: Retailers often ask if you want to store your card information on their site for faster checkout in the future. It's a good idea to decline this option to reduce the chances of having your card information compromised in a retailer data breach.
• Do make sure the site you’re using is secure: Submitting information like credit card info on a site that is not secure increases the likelihood that a cybercriminal will gain access to it. When shopping online, check the URL in your browser to make sure the site you’re using is secure. Google Chrome and Firefox will show a locked padlock on secure sites. If you’re using Internet Explorer, check that the URL starts with https rather than http. When unsure, try to stick with retailers that you know and trust.
• Don’t fall for phishing emails: If you receive an email that, at first glance, appears to be from a legitimate company, hover your mouse over the hyperlinks to see if it includes a valid URL for that company. Next, scan the email for spelling and grammar mistakes. Then look at the sender’s email address to see if it matches the company’s website domain. If you see any reason to suspect it might be a phishing scam, delete it immediately. Cybercriminals will often include attachments in phishing emails. Opening these attachments could result in downloading malware on your computer. Legitimate retailers also don’t force you to open attachments to see a deal, so if an email directs you to open an attachment, it’s best to assume it’s a scam.
• Do change your passwords: If you shop online frequently utilizing multiple retailers, you need to have a different password for every site. If you don’t, and a cybercriminal obtains your password on one site, they will gain access to all your accounts.
• Don’t use public Wi-Fi: The more people who have access to the network you’re using, the greater possibility that someone else could access your accounts. When making purchases online, it’s best to use a private Wi-Fi network rather than a public one.
• Do monitor your bank and credit card accounts: Even if you are careful and take every precaution, a cybercriminal could still access your account. That’s why it’s important to check your bank and credit card accounts regularly for any suspicious charges. If you notice one, contact your bank or credit card issuer immediately.

Enjoy Retirement Without Financial Stress: Budgeting for Fun and Leisure – Oct. ‘24

Practical tips for prioritizing activities to support financial peace of mind

 

Retirement is a time for seniors to reap the rewards of their hard work, indulge in hobbies, travel and engage in leisure activities. However, managing finances during this period is crucial to ensure they can enjoy these activities without the burden of financial stress. Here are some practical tips on how to budget effectively for travel, hobbies and leisure.

• Create a Retirement Budget: Seniors should begin by listing all sources of income, including pensions, Social Security and any other retirement benefits. Next, outline essential expenses like housing, utilities, health care and groceries. Lastly, allocate funds for travel, hobbies and leisure activities to ensure they fit within the budget.

• Prioritize Activities: It’s recommended seniors identify which activities are most important and prioritize spending on those that bring the most joy and satisfaction. Seniors should be mindful of how often they engage in these activities to maintain a balanced budget.

• Look for Discounts and Deals: Many businesses offer senior discounts on travel, entertainment and dining. By taking advantage of these offers, seniors can stretch their budget further.

• Plan Ahead: Seniors can also save money by booking trips and activities in advance to take advantage of early-bird discounts and special offers. This can help them save money and receive the best deals.

• Stay Flexible: Lastly, stay open to adjusting plans based on the budget they create. If an activity is too costly, look for more affordable alternatives that still bring joy.

Building Your Financial Safety Net - Sep. '24

Steps to Build an Emergency Fund and Safeguard Your Finances

In today's ever-changing landscape, establishing a robust financial safety net is essential. One of the most effective tools for preparing for unexpected expenses is an emergency fund. According to a Bankrate survey conducted on Dec. 2023, only 44% of U.S. adults could pay an emergency expense of $1,000 or more from their savings. This article explores the importance of having an emergency fund, how to determine the right amount to save, and practical steps to start or enhance an emergency fund journey.

• Assess Your Savings Needs

Determining the right amount for your emergency fund is personal. Begin by looking at monthly expenses like rent, utilities, groceries, transportation, insurance, and other regular costs. Experts typically suggest saving enough to cover three to six months' worth of expenses. This buffer helps cover unexpected situations such as car repairs, medical bills or job loss, aiming to sustain your lifestyle without relying on high-interest loans or credit cards.

• Setting Up Your Savings

Once you’ve determined your target amount, the next step is to establish a savings plan. Start with small, manageable contributions to avoid straining your budget. Setting up automatic transfers to a dedicated savings account can help make saving a habit. Choose an amount that fits comfortably within your budget, whether it’s $20, $50 or $100 per month. Consider using a high-yield savings account to maximize your interest earnings, ensuring your emergency fund grows faster over time.

• Choosing the Right Savings Vehicle

Selecting the best savings option for your emergency fund is crucial. Savings accounts provide easy access to funds, ideal for emergencies. Money market accounts offer slightly higher interest rates and check-writing abilities, and CDs offer higher returns but require locking funds for a fixed period. By considering your liquidity needs, interest rates and fees, you can make an informed decision that suits your financial goals.

• Building Your Emergency Fund

Start by making manageable monthly contributions and automate transfers from your checking account for convenience. Gradually increase contributions as your financial situation improves. Celebrate milestones, like reaching savings goals, to maintain motivation. Regularly review and adjust your savings plan to ensure it meets your financial goals and is adaptable to unforeseen circumstances.

• Managing Your Emergency Fund

Effectively managing your emergency fund involves regularly monitoring its growth and ensuring it meets your financial safety net needs. Keep a clear list of what qualifies as emergencies to avoid unnecessary withdrawals, and periodically review your budget to ensure it aligns with your current financial situation.

More Information

To explore the variety of savings options for your emergency fund, contact customerservice@washsb.com.

Five Ways to Improve Finances as a College Student - Aug. '24

As summer winds down, many young adults will embark on the exciting journey of college life. Today, the average American student leaves college with more than $37,000 in debt, including student loans. With the total U.S. student debt sitting at $1.56 trillion, according to data from the Federal Reserve, the young adults in your life may face more financial challenges in their education pursuit than past generations.

Five Money Tips for College Students

• Create a budget — Creating a budget and sticking to it allows you to control where your money goes instead of wondering where it went, regardless of your current financial situation. A budget is an effective tool to track and organize the money you make and spend. This guide from Federal Student Aid can be used as a starting point in building a budget as a student.

• Apply for FASFA assistance — Make a note on your calendar to fill out the Free Application for Federal Student Aid (FAFSA) before starting college and every year while in school. This form determines eligibility for federal aid for both current and prospective college students. It costs nothing to apply but can be a great help in paying for college.

• Explore scholarship options – The FAFSA isn’t the only resource available to help pay for college. Scholarships are a form of financial aid that don’t have to be repaid! Scholarships may be offered based on a variety of criteria, including academic merit, athletic skill, financial need and inclusion/diversity. Scholarships may differ drastically in terms of amount. Utilize your high school counselor’s office, college’s website, or call their financial aid office to learn about the various scholarships they offer and apply for those for which you qualify.

• Be discount-obsessed—Expenses can add up faster than most young adults would expect. By taking advantage of free and discounted on-campus events and using campus fitness centers, college students can save themselves from overspending on expensive entertainment. Many companies may also have student discounts. Students Beans and UNiDAYS are two free apps that offer an extensive amount of student discounts. In addition, looking for sales or price match options can help stretch your dollars further.

• Exploring classes on financial literacy — Classes may be the best way for young adults to learn finance skills. Your college or local community may offer free or low-cost classes to start your education on the subject.

 

This article was provided by the Iowa Bankers Association.

---

Deep Fake and Cloned Voice Scams a Serious Threat – July ‘24

Washington State Bank offers five tips to help consumers avoid scam that employs AI technology

 

Fraudsters often take advantage of new technology to trick consumers into giving them money. One example is by using Artificial Intelligence in a negative light to impersonate law enforcement, employees or family members.

While scammers often spoof email addresses to trick consumers into sending money to help a friend or family member, AI allows them to employ the same tactics to phone calls. Through a method called voice cloning or a deepfake scam, a criminal uses AI to mimic someone’s voice from a very small audio sample.

These fraudsters may call you, claiming to be a family member, and try to trick you into believing there was an emergency that requires an urgent transfer of funds. Scammers may also try to impersonate your boss and ask you to wire money for a rush project or claim to be a kidnapper demanding you pay a ransom. To help prevent such scams, we are sharing five tips on how consumers can protect themselves.

1. Don’t panic. Scammers prey on your emotions. Before you act, take a step back and think about the request that is being made. Contact the loved one personally before acting to verify the situation.
2. Trust your instincts. If you receive such a call from but something feels off, there’s a good chance that it could be a scam. Rely on your intuition in these situations. If something doesn’t feel or sound right, a little bit of investigation can save you money and heartache.
3. Know how to spot red flags. There are many warning signs that can help you determine if such a phone call is a scam. Some red flags to watch for include:

• • The call comes from an unknown number.
  • You only briefly hear the person you know before the phone is passed off to someone else.
  • You are asked to send money immediately for any reason, especially if it’s through cryptocurrency or gift cards.
  • You are asked for personal or financial account information.

4. Call the person that supposedly is contacting you. If you receive this type of phone call, there is one person you can rely on to verify its legitimacy — the actual person who supposedly contacted you. Call or text that person using the contact information you have saved for them. You’ll find out quickly whether it was a scam.
5. Be proactive. Stay ahead of the fraudsters by choosing a safe word only your family knows that you can use to verify their identity over the phone.

If you receive a suspicious phone call from someone impersonating someone you know, report it to the Federal Trade Commission immediately at https://reportfraud.ftc.gov or by calling 1-877-382-4357. You should let friends and family know you received the call, so they can be on alert for suspicious calls as well.

These tips were provided by the Iowa Bankers Association.

---

How To Prepare for a Weather Emergency While Avoiding Scams – June ‘24

This article comes from the FTC

Scammers follow weather reports just like everyone else — and when disaster strikes, they’ll strike, too. If you know what scams look like after a weather emergency, it’ll be easier to make plans to avoid them. Here are ways those scams play out, and how you can be prepared.

Update your insurance policy. To avoid surprises, check to make sure your insurance policy is current and find out what is covered — and what isn’t.

Check out contractors before you need one. Ask people you know and trust for recommendations. Then search online for the company’s name. Online reviews might help you decide what company to hire. When considering reviews, it’s good to look at a variety of sources, including well-known websites that have trustworthy and impartial expert reviews.

Get credentials. Find contractors who are licensed and insured. Check with your state or county government to confirm a contractor’s license. When the time comes to hire, consider asking the contractor for ID, proof of insurance, and references.

Research online sellers before you buy. When you need materials to prepare for or recover from a weather emergency, ads that promise great deals from companies you know and trust might seem appealing. But unusually low prices are a sign of a scam. If you see an ad for what seems like a familiar company but you’re not sure the ad is real, check it out. Go to the company’s website using a page you know is real — not the link in the ad.

Remember that when the pressure is on, scammers will make promises, ask you to pay upfront, and insist you pay in ways that make it hard to get your money back. Anyone who insists you pay by gift cards, wire transfer, payment apps, or cryptocurrency is a scammer. Get a contract and all promises in writing. And, if you can, pay by credit card after the work is done.

To learn more about ways to prepare for, deal with, and recover from a weather emergency, visit ftc.gov/WeatherEmergencies.

If you think you see a scam, tell the FTC at ReportFraud.ftc.gov. Your report could help the FTC stop the scammers and help someone else avoid that scam.

The Breakdown to Becoming a Homeowner- May '24

No matter what stage you’re in, homeownership can be stressful. That’s especially true in today’s market, which has been hampered by higher loan interest rates, low inventory, and high-priced listings.

Whether you’re in the market for a new home or your first home, it’s easy to become intimidated by the prospect of homeownership. It doesn’t have to be scary. With a little knowledge and preparation, you can be prepared for the homebuying process.

Determine Your Homebuying Readiness

Before you even consider buying a home, it’s important to know how the homebuying process works and make sure you’re financially ready to make such a large purchase. Taking your total savings, debt, and credit history into consideration will help determine your qualifying loan amount, interest rate and how much you can afford as a down payment.

For down payments, the more you can pay up front, the lower your payments and the higher your equity. Typically, homebuyers try to put down 20%. This isn’t a requirement, but doing so could help reduce the interest rate on your mortgage.

Once you determine you’re ready to buy a home, it’s a good idea to get pre-approved for a mortgage. This will give you a solid understanding of the loan amount you qualify for, and it will eliminate that step when you are ready to make an offer.

Documents You’ll Need

Once you’re ready to apply for your mortgage or pre-approval, you can make the process more efficient by having the following documents and information ready for your mortgage loan officer.

• W-2 forms from the past two years.
• Pay stubs from the past 30 to 60 days.
• Federal income tax returns from the past two years. (If Self-Employed)
• Bank statements from the last two months.
• Information about your other long-term debts.
• Driver’s license and Social Security number.
• Any other information your lender requires.

Once you are pre-approved and have an idea of what type of mortgage you need, it’s time to start home shopping. Be sure you stick to your budget as determined by the amount you were pre-approved for. Look at as many houses as you can, to get a sense of the type of home you need.

More Information

To get the homebuying process started, fill out our Mortgage Information Form.

These tips are provided by the Iowa Bankers Association.

Ensuring Your Family’s Future - April '24

Six Steps for Navigating the Financial Challenges of Raising Kids and Saving for the Future

According to the Brookings Institution, the cost of raising a child born in 2015, from birth to age 17, is $310,605. Of course, every family is different, and that amount doesn’t factor in college tuition, but it shows that once you add children to the equation, a significant amount of your annual expenses will be spent on their upbringing. Following are six financial planning tips to ensure your family’s well-being.

• Save for their education — Just like retirement, it’s never too early to start planning for your child’s higher education. Consider creating a 529 plan for your children. It grows tax free, and your children will be able to make tax-free withdrawals if it’s used for a qualified expense — tuition, room and board, fees, and books. With a 529 plan, you can grow your child’s college education fund over time, lessening the burden of educational expenses in the future.
• Buy a life insurance policy — If the unthinkable happens to you, a life insurance plan can ensure the loved ones who rely on you financially are taken care of after you’re gone.
• Create an estate plan — Along with a life insurance policy, you should create an estate plan to determine what happens to your assets. You will also need to determine a guardian for your children if you should pass away before they are legal adults. The guardian you select can also be designated to manage the accounts you leave to your children until they reach a legal age.
• Increase your emergency fund contributions — As we’ve stated previously, additions to a family increase expenses. If you haven’t done so already, recalculate how much you need in your emergency fund and adjust your monthly contributions to ensure you have enough saved for emergencies.
• Don’t neglect your retirement accounts — With the additional expenses that come with having children, it may be tempting to stop contributing to your retirement accounts. Contribute less if you must, but contributing nothing will set you back and likely delay your retirement plans.
• Meet with a financial adviser — Set up a meeting with a financial adviser to help identify areas in your finances you can adjust to ensure your family’s future.

How to Redefine Your Retirement in Your 50s - Mar. '24

Six Steps for Managing Your Finances as Retirement Creeps Closer

 

Age 50 is a major milestone. If you want to retire at 65, you only have 15 years left at age 50 to make sure you have enough money saved to accomplish your goals. That may not seem like a long time, especially if you’ve been working for the last 25-30 years, but there’s still time to ensure you will have what you need. Following are six steps to help you determine if your retirement plan is on the right track.

• Eliminate debt — By age 50, you should have been able to eliminate or come close to paying off some of your largest debts, including student loans and a mortgage. Look at your remaining debts and prioritize paying them off quickly so you can contribute more to your savings.

• Start planning what you want to do in retirement — What you want to do after you retire will determine how much money you need to save before you can do so. Start examining what your plans will include and if the amount you’re saving will allow you to achieve that goal.

• Learn more about Social Security — How long you have worked and how much you have paid in Social Security taxes will determine your benefit, which you can start to collect at age 62. When you turn 50, you may want to create an account at ssa.gov so you can get a better idea of how much you will be able to collect and how your other savings will impact your Social Security.

• Pad your retirement savings — At age 50, experts suggest you should have about five to six times your annual salary saved up in retirement accounts. If you are behind in your savings, you are allowed to make catch-up contributions. With a 401(k), you can contribute an additional $7,500 per year for a maximum of $30,000 each year once you reach age 50. You can also contribute an extra $1,000 to a traditional or Roth IRA for a maximum of $7,000 in one year. Calculate how much more you can contribute to ensure you will have enough to retire.

• Update your estate plan — Age milestones are a great time to review your estate plan and make necessary adjustments. Along with a last will and testament, your estate plan should include a financial power of attorney, health care power of attorney and a living will. You should also review beneficiary designations on life insurance, retirement plans and other investments.

• Meet with a financial adviser — Have a professional review your finances and provide an unbiased opinion. A financial adviser can help you gauge whether your savings are on track and help you set a tentative retirement date, so you can rest assured that you will be able to do what you want when you do retire.

The Dos and Don’ts of Your First Credit Card- Feb. '24

Getting your first credit card can be an exciting moment. It's a significant financial milestone that represents financial independence and responsibility. If not used carefully, however, they can also lead to financial pitfalls. To help you make the most of your first credit card experience, here are the dos and don’ts you should follow when using your first credit card.

Do apply for a credit card early — Most experts agree that you should apply for your first credit card as soon as you are old enough — at age 18. This allows you to start building a credit history right away, which can help when you need to apply for a loan later in life.

Do your research — One of the biggest mistakes you can make when getting your first credit card is not doing your research. Choosing the wrong credit card can result in unnecessary fees, high-interest rates and missed rewards opportunities. Compare different credit card options to find a card that fits your financial goals and spending habits.

Don’t ignore the fine print — Understanding the terms and conditions of your credit card will help you use it more responsibly. Pay close attention to the interest rates, grace period, minimum payment requirements and any additional fees you may incur.

Don’t overextend yourself — Once you start using your credit card, don’t buy more than what you will be able to pay back each month. Try to use it on a couple of small items each month, so you can build a history of paying off your balance. If you charge more than you can afford in any given month, you may be forced to carry a balance that will incur interest and will cost you more to pay off. It could also cause serious damage to your credit score.

Do pay your bill on time — Missing payments or paying late can result in large fees and cause harm to your credit score, making it more challenging to secure loans or favorable interest rates in the future. Most credit cards offer the option to set up automatic payments. Set up this tool right away to make sure you always pay your bill on time.

Don’t apply for multiple credit cards at one time — Applying for too many credit cards at once can hurt your credit score as each application will trigger an inquiry on your credit report. That can potentially cause your score to drop. That’s why you should do your research ahead of time and know what type of card you want to use, then only apply for cards that fit your needs.

Do monitor your credit — Checking your credit report annually is the best way to ensure you haven’t become a victim of identity theft or that errors haven’t been made on your credit history. You can access a free report by visiting AnnualCreditReport.com or by calling 877-322-8228. Check your report each year for inaccuracies. As you build your credit history, you may also want to consider using a credit monitoring service to stay updated on any changes.

Don’t treat credit cards as free money — Anything you charge on a credit card is essentially a loan that must be paid back. Treating credit cards as free money can lead to reckless spending and mounting debt that will cause severe harm to your ability to be approved for a loan. It can also make it more difficult to find housing or to obtain certain services.

Getting your first credit card is a significant step in your financial journey. Avoiding common mistakes with your credit cards — whether it’s your first card or your fifth — is essential to building a healthy credit history and achieving financial stability.

These tips are provided by the Iowa Bankers Association.

---

New Federal Reporting Requirements for Business Owners - Jan. '24 pt. 2

New federal reporting requirements (Corporate Transparency Act) took effect on January 1^st, 2024, that may require you to report your business entity’s beneficial ownership information to the federal government. So how do you know if your business will be impacted? The US Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) has issued a guide to help you understand the requirements and qualifications. Click here to download the guide or visit fincen.gov/boi for additional resources.

More information on the act:

Starting in 2024, many business entities across the US will need to comply with the Corporate Transparency Act. The intentions of the CTA are to combat money laundering, terrorist financing, corruption, and tax fraud. The act establishes beneficial ownership reporting requirements for specific corporations, LLCs, and other entities formed to do business in the US.

The fincen.gov/boi webpage also contains guidance documents, answers to frequently asked questions, introductory videos, quick reference guides, and other resources to ensure that reporting companies and the business community have the tools they need to comply with the new reporting requirements.

If you have questions about the reporting requirements, you can contact FinCEN’s general Regulatory Helpline by visiting www.fincen.gov/contact.

As your next step:

Go to FinCEN.gov/BOI to determine if your entity needs to report information about their beneficial owners—the persons who ultimately own or control the company—to Treasury’s Financial Crimes Enforcement Network (FinCEN). You can also subscribe to FinCEN Updates for future guidance.

FOR MORE INFORMATION: The www.fincen.gov/boi webpage also contains guidance documents, answers to frequently asked questions, introductory videos, quick reference guides, and other resources to ensure that reporting companies and the business community have the tools they need to comply with the new reporting requirements.

This information was provided by the Iowa Secretary of State.

---

How You Can Spot and Prevent Financial Abuse - Jan. '24