How Much Does Owning a Pet Really Cost?

So you’ve decided to get a pet. Aside from making sure you’re responsible and emotionally prepared to give your new friend a great life — no pressure — it’s crucial to consider the logistics. This means time — and, of course, money.

So you’ve decided to get a pet. Aside from making sure you’re responsible and emotionally prepared to give your new friend a great life — no pressure — it’s crucial to consider the logistics. This means time — and, of course, money.

Here’s what to expect in terms of expenses:

Bringing Fido home

The initial cost of getting a pet, including the necessary equipment, can range from less than $100 to several thousands, depending on the type of animal or breed. For example, a report from Rover.com finds the average one-time cost of getting a dog is $838.

But if you want a purebred puppy, you’ll pay upward of $2,000 at some breeders before going shopping for a dog bed and toys. Adoption is always a low-cost way to get a pet. At most shelters, the one-time fee ($0-$500) covers vaccines, spaying/neutering and a microchip.

Remember that dogs aren’t the only animals waiting for a forever home at shelters. Rabbits, guinea pigs, hamsters, birds, reptiles, and fish are occasionally available for adoption.

Recurring expenses

Your pet’s monthly expenses also depend on its size, age, health and behavior, as well as your location and the brand and type of supplies you buy. Fish are usually the lowest maintenance, requiring only food. Be prepared to shell out a couple hundred dollars for an aquarium when you first get Nemo, though.

For small mammals, budget for food, bedding and occasional toys or treats. This will total about $300 a year, according to the American Society for the Prevention of Cruelty to Animals. Larger mammals, such as guinea pigs and rabbits, love lots of bedding that needs to be changed often and cost closer to $600-$700 annually.

Cats and dogs need food, treats and toys, yearly medical checkups, flea and tick prevention, and sometimes licenses. The ASPCA estimates that caring for a cat costs $670 per year, including an annual vet visit. Rover.com reports the average monthly costs of owning a dog to be $75, with a yearly checkup averaging $120. That works out to $1,020 per year.

Bump up your budget for big dogs that need (a lot) more food, animals that must be groomed often, pets that need walkers or sitters, and, depending on your animal’s health and behavior, medical bills.

Unexpected costs

With pets, accidents happen — and they could cost you thousands.

“Unexpected veterinary bills are the most surprising — and most costly — variables in dog ownership,” says Brandie Gonzales, director of corporate communications and PR for Rover.com. “While preventative care can go a long way, you’ll want to be prepared for any veterinary emergencies, like if a dog were to accidentally eat something he shouldn’t. Consider pet insurance, which will make unforeseeable expenses easier on your wallet.”

Of course, cats and other animals are subject to accidents and surprise vet visits, too.Owners might also be surprised at the cost of pets with behavioral problems, including a trainer. “Another unexpected cost would be replacing any household or personal items that your pet might mistake as a toy,” Bank says.

Add pet-sitting to your vacation budget next time you plan to go out of town, and a walker if you have a pup and are gone most of the day. These services can range from around $15 for a walk to about $65 for a night of boarding.

How to save

You don’t need a $325,000 dog mansion to give your pet its best life. There are plenty of ways to save on the things you need: Buy food and treats in bulk for a discount, search your local Craigslist for hand-me-down equipment such as aquariums and cages — just be sure to sanitize before using — and check for coupons from big-box pet stores online before going shopping. You can also wash your dog at home to cut down on trips to the groomers.

Thoughtful purchases will save you money. “Buy puzzle toys to feed your dog treats instead of giving them easily consumable treats,” Gonzales says. “The toys are a great game for your dog and you’ll spend less on treats.”

Just don’t skimp on high-quality, nourishing pet food; flea and tick medication; and veterinary care. “Preventative treatments, vaccinations and dental care keep your dog healthy and help you save in the long run,” Gonzales says.

© Copyright 2017 NerdWallet Inc. All Rights Reserved

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Millennials: How Much Are You Really Spending?

You might share certain spending habits with other millennials — and you might occasionally catch flak for those habits. But some of these patterns are a byproduct of your age and the times we live in: spending less on health care because younger adults are generally healthier, for example, or spending less on magazines and records and more on e-books and streaming music. And if you compare how much of your income you’re spending on, say, entertainment, with what other generations are spending, you might be surprised by how small the differences are.

You might share certain spending habits with other millennials — and you might occasionally catch flak for those habits. But some of these patterns are a byproduct of your age and the times we live in: spending less on health care because younger adults are generally healthier, for example, or spending less on magazines and records and more on e-books and streaming music. And if you compare how much of your income you’re spending on, say, entertainment, with what other generations are spending, you might be surprised by how small the differences are.

By looking at annual spending across generations in the Bureau of Labor Statistics’ Consumer Expenditure Survey, you’ll see how age groups spend differently according to their needs and priorities — and get an idea of how your own priorities and payouts measure up.

The Consumer Expenditure Survey measures all annual expenditures, such as housing, health care, food, entertainment, insurance, education, utilities, clothing and transportation.

Total annual spending: How do you compare?

$48,576: Average amount millennials spent in 2016

The oldest two generations spent far more of their income last year, but they also earn far less than other groups. The average pretax income for millennials was $65,373.


Food

You might enjoy going out for dinner — but so does everyone else — and your overall food spending is well-aligned with nearby generations. Millennials spent an average of $6,316, or 10% of their pretax income, on food in 2016. Members of Generation X spent the highest dollar amount in this category — $8,870 — but it accounted for a similar percentage (9%) of their income.

Food spending: How do you compare?

$6,316: Average amount millennials spent on food in 2016

Millennials spent 47% of their food budgets on food away from home, more than all other groups. Still, their total food spending as a percentage of income (10%) was equal to the average across all generations.

Fun fact: Millennials spent less than any other generation on ice cream last year: $40.34, on average.


Alcohol

By some measures, you might have spent more than members of other generations on drinking away from home last year — 53% of your alcohol budget if you’re average, according to the data. But all generations spent approximately 1% of their income on alcohol.

Alcohol spending: How do you compare?

$461: Average amount millennials spent on alcohol in 2016

All generations spent approximately 1% of their income on alcohol. However, millennials spent the greatest portion of their alcohol budget (53%) and the most money overall on booze away from home.


Shelter

If you’re like most of your peers, you spent relatively little on shelter in 2016 — second only to the silent generation, who might live in mortgage-free homes or with other family members. Shelter spending includes many of the costs of keeping a roof over your head: rent or costs to own, maintenance and repairs, and homeowners or renters insurance, for example.

Shelter spending: How do you compare?

$10,678: Average amount millennials spent on shelter costs in 2016

Millennials spent fewer dollars, on average, than Generation X and baby boomers, but shelter costs accounted for 16% of their pretax income. Generation X spent 14% of their income on shelter, and baby boomers spent 13%.


Utilities

Nearly everyone spent less on residential phone service than cellular phone service in 2016, and you’re among the generation that spent the least. Millennials, Generation Xers, and baby boomers all spent an average of about 5% of their annual income on utility costs. Considering you’re likely to have a lower income than an older adult, you might be doing some strategic budgeting to keep those bills under control.

Utility spending: How do you compare?

$3,020: Average amount millennials spent on all utilities in 2016

Millennials, Generation X and baby boomers spent an average of 5% of their annual salary on utilities last year.

Not all utilities measured in the Consumer Expenditure Survey are portrayed in this chart.


Clothing

Your generation might get a bad rap for frivolous spending, but you probably spent less than many older adults on clothing in 2016. Members of Generation X spent far more — $2,577, on average — but Gen Xers and millennials both spent 3% of their pretax income on apparel and related services.

Clothing spending: How do you compare?

$1,753: Average amount millennials spent on apparel and related services in 2016

All groups spent an average of between 2% and 3% of their total income on apparel. Compare total spending across generations in the second tab below.

Not all apparel and services expenses within the Consumer Expenditure Survey are illustrated in this chart.


Transportation

If 2016 expenditures are an indication, you’re more likely to buy a used vehicle than new. And you probably spent more on public transportation — including buses, taxis, subways and commuter rails — than members of older generations.

Because millennials are slightly less likely to own vehicles than other generations, the data on vehicle purchases, gas and related car-ownership expenses are slightly skewed by those who answered $0 to those questions.

Transportation spending: How do you compare?

$8,426: Average amount millennials spent on all transportation costs in 2016

These costs accounted for 13% of millennials’ income, on average, while Generation X spent 11% and baby boomers spent 12%. Compare total transportation expenditures across all generations in the second tab below.

Not all transportation expenses included within the Consumer Expenditure Survey are displayed in this chart.

Fun fact: Millennials spent more on new motorcycles than any other generation ($64.65, on average), and spent far more on new motorcycles than used ($13.92, on average).


Entertainment

You might have spent less than members of some older generations on entertainment. Still, you likely spent more on streaming audio and video, and television probably took the biggest chunk out of your entertainment budget, with home internet services a close second.

Entertainment spending: How do you compare?

$2,311: Average amount millennials spent on all entertainment costs in 2016

All but the silent generation, who spent 5%, spent an average of about 4% of their income on entertainment. See how total entertainment spending compared across age groups in the second tab below.

Not all entertainment expenses included within the Consumer Expenditure Survey are displayed in this chart.

Fun fact: Millennials spent more on musical instruments than any other generation: $25.04, on average.


Notes on the data

The data are from the Consumer Expenditure Survey, released Aug. 29, 2017. It’s based on questions the Bureau of Labor Statistics asks households across the U.S. about their spending habits throughout each year. When numerous people answer $0 for any single expense on the Consumer Expenditure Survey, the data are skewed and the average amount spent seems low. For example, few millennials pay for a home landline. So, in 2016, the average amount millennials spent on residential phone service was $90, or approximately $7.50 per month, far lower than most residential phone bills. There are similar patterns in vehicle and home ownership costs among millennials, as well as throughout the survey data.

The survey is asked of “consumer units,” not individuals. This means, in most cases, that the expenses are attributed to a single person in the household. So, for instance, if a 19-year-old millennial lives at home with his 45-year-old father, the household expenditures will appear under the father, or in the Generation X category of the generational tables.

© Copyright 2017 NerdWallet Inc. All Rights Reserved

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Safeguard Your Identity with These Helpful Resources

Identity theft and consumer fraud can happen in an instant, so it’s important to protect yourself. Learn about simple tips and tools you can use to reduce your risk of identity theft and protect your financially sensitive information. 

Identity theft and consumer fraud can happen in an instant, so it’s important to protect yourself. Learn about simple tips and tools you can use to reduce your risk of identity theft and protect your financially sensitive information. Our short interactive course will equip you with important knowledge regarding:

  • Consumer fraud and identity theft
  • Prevention and protection tips
  • How to respond to identity theft

Get started by following the link to F&M Bank's Community Classroom.

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9
1|

The Keys to Financial Wellness for Millennials

Getting a job, buying a car, buying a home — all of these milestones are both exciting and at times stressful for young adults just getting started. For many people, these are wonderful goals that help push them forward. But as millennials build their careers, start families and consider their futures, it’s important to remember that true success has little to do with your job title, the type of car that you drive or the size of your house. Success is about having peace of mind.

Getting a job, buying a car, buying a home — all of these milestones are both exciting and at times stressful for young adults just getting started. For many people, these are wonderful goals that help push them forward. But as millennials build their careers, start families and consider their futures, it’s important to remember that true success has little to do with your job title, the type of car that you drive or the size of your house.

Success is about having peace of mind. And you cannot feel successful or have a sense of true accomplishment when you are worried about money. Millennials must be comfortable with their finances to achieve long-term success.

To have peace of mind as well as peace in your finances, you must prepare for and practice the keys to financial wellness:

Invest in yourself

This is about investing in your future by seeking the highest education that you desire intellectually and can afford financially. Your knowledge and education will open doors that would have otherwise remained closed. Education has a major influence on your earning power. It can propel you when the economy is good and sustain you when it’s bad. You can lose your job but not your education.

Save, save, save

The most essential rule of saving is to pay yourself first. You should contribute to your personal savings and your retirement savings with every paycheck. The simplest way to accomplish this goal is through direct deposit. For your personal savings, you can have a set amount deposited into a savings account and then have the balance go into your regular checking account, which is used to pay for your living expenses. By doing this, you are assured that you have emergency savings. For your retirement savings, you should start contributing to a 401(k) or individual retirement account as early as you can. Start contributing in your 20s so you have even more time to take advantage of compound interest (in which your earnings are added to your principal).

Limit your use of credit

Spend your money in a way that minimizes your debt. You should use cash to pay for small-ticket items, those things you can afford to pay for outright. Expensive purchases such as a house, car and furniture understandably might not be bought for cash. But you can still be mindful of your spending habits by asking yourself key questions: Is this a need or a want? If it is a want, can it wait, or is it something that you should purchase immediately? In addition, do some comparative shopping. Be sure that you’re getting the best price for the items you buy — and for the credit you use. Are you receiving the lowest available interest rate on your credit cards? If you’re paying 21% while you could be paying 12%, you are doing yourself a disservice and throwing away your money.

Protect your family financially

If you’ve started a family, be sure that you have adequate life insurance to protect them in the event of your death. This is especially important if you have small children, because you want to provide for their future. Your children’s financial needs will continue, and they’ll need money for their everyday expenses such as housing, clothing and food. You may also want to help ensure opportunities for a brighter future by providing enough money to assist with endeavors such as going to college, buying a car or starting a business.

You can find affordable term life insurance policies. These are basic, no-frills policies with a set duration of coverage, usually up to 30 years. You could also purchase policies for an indefinite term or with additional features. For instance, a whole life policy remains in force until death, but can be significantly more expensive than a policy that lasts for a specific number of years. Talk to your financial advisor and/or insurance agent to determine the type and amount of coverage you need.

Consider homeownership

Owning a home has long been considered a foundation of wealth creation. It’s one of the most important steps you can take toward financial wellness. If you plan on living in an area for over five years and you can afford to buy a home, it’s something you should certainly consider. As a homeowner, you can build equity and take advantage of tax benefits such as mortgage interest and property tax deductions. But homeownership isn’t for everyone. If you prefer flexibility and don’t plan to live in the same place or you don’t want the responsibility of owning a home, it may not be right for you.

Start early

The earlier you establish these practices and pillars of financial security, the more possibilities and freedom you will have later in life. Developing sound financial principles now will ensure that you and your family can weather financial storms and achieve true success.

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Scammers and Criminals Abuse Caller ID

We have been notified that several customers have received calls from the National Institutes of Health (NIH) or other groups claiming to be health care affiliated. The Caller ID on these calls make it appear that the calls are from F&M Bank. Here are some tips to avoid these types of scams!

We have been notified that several customers have received calls from the National Institutes of Health (NIH) or other groups claiming to be health care affiliated. The Caller ID on these calls make it appear that the calls are from F&M Bank.

Unfortunately, criminals and scammers can assign any number to their caller ID, which can easily confuse consumers and lead to fraud. Local numbers and those using trusted companies (such as F&M Bank) make it more likely the consumer will respond to a scammer’s call.

The NIH wants you to know that they do offer grants for research, but these grants are to researchers and must be applied for. Here are some tips to avoid these types of scams:

  • Hang up if you get a strange call from the government and visit the official (.gov) website for more information.
  • Never give out – or confirm – personal information on a call you receive.
  • Never send money through wires or reloadable cards.
  • Pressure to act immediately is a sure sign of a scam.

Consumers can register a complaint with the Federal Trade Commission (FTC) online by accessing this site: https://www.ftccomplaintassistant.gov/. Complaints can also be filed with the Federal Communications Commission at https://consumercomplaints.fcc.gov/.

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Budgeting and Planning for a Master’s Degree

Pursuing a master’s degree is exciting, but it can also be expensive, even after scholarships and financial aid are factored in. If you’ve been burning to hit the books, these tips will make it easier to pay for grad school.

Pursuing a master’s degree is exciting, but it can also be expensive, even after scholarships and financial aid are factored in. If you’ve been burning to hit the books, these tips will make it easier to pay for grad school.

Give yourself time

It’s tough to accumulate the average $30,000 to $40,000 needed for grad school tuition. Allow a year or two to save, budget and plan rather than jumping right in.

Save smart

Establish a grad school fund and commit to depositing a set amount at regular intervals. Some sound education investment choices include:

  • 529 savings plans: Money grows tax-free but must be used for qualified educational expenses.
  • 529 prepaid tuition plans: These tax-free plans allow you to pay tuition in advance to avoid future rate hikes. Money must be used for tuition at the chosen school.
  • Certificates of deposit: These federally insured certificates offer higher returns than traditional savings accounts in return for leaving funds on deposit for a specified term. The money can be used for anything.
  • Savings and money market accounts: This choice offers the most liquidity, but rates tend to be lower than other options. There are no restrictions on how the money can be used.

Take advantage of tax breaks

Once you’re enrolled, Uncle Sam can help in two ways:

  • Lifetime learning credit: This tax credit refunds 20% of qualified educational expenses up to $10,000 for a maximum student benefit of $2,000 annually.
  • Tuition and fees deduction: Deduct up to $4,000 of qualified educational expenses annually.

Boost your cash flow

To create a cash surplus while saving for and attending grad school:

  • Enjoy more home-cooked meals and dine out less frequently.
  • Reduce entertainment expenses by exploring local parks, free concerts and neighborhood sporting events.
  • Sell unwanted items online or at yard sales.
  • Turn hobbies and interests into side income.
  • Shop around for the best deals on insurance, mobile phone, bank accounts and utilities.

If things are still tight, remember that you aren’t limited to choosing between full-time studies or none at all. Attending school part time over a longer period could make budgeting and work-study balance easier.

© Copyright 2017 NerdWallet Inc. All Rights Reserved

 

Fraud Alert: Debit Card Use in the State of Florida

Fraud Alert: Debit Card Use in the State of Florida

FRAUD ALERT – on Friday, beginning around 11:30 am we began getting notifications from our fraud detection system of a small number of our Virginia customers’ cards being used in gas stations and stores in the state of Florida, with confirmations of fraud.

As a precautionary measure, F&M has placed a block that requires the use of your PIN at the following types of merchants in the state of Florida:

  • Inside Gas Stations
  • Big Box Grocery Stores (example: Walmart, Target)
  • Grocery
  • Pharmacy
  • Discount Stores (example: Family Dollar)

A PIN must be used at these merchant types until this matter is resolved.  If you do not know your PIN, please notify the bank and we will order a new PIN to be mailed to the address on file for your account.

Customers who notify the bank that they cannot recall their PIN and are a Kasasa Cash or Kasasa Cash Back Accountholder:  The Bank will pay the higher rate of interest for the statement cycle that ends in August to allow time for delivery of a PIN in the mail.  Customers would be expected to meet their 12 required transactions for the statement cycle that ends in September and there-after to qualify for the higher rate of interest.

We apologize for any inconvenience that this may cause for you, our valued customers.

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Save More When Back-to-School Shopping Online

Shopping for school supplies, electronics and clothing can be a chore — and an expensive one at that.

Families with children in grades K-12 plan to spend an average of $687.72 on back-to-school shopping, about $14 more than last year’s average of $673.57, according to the National Retail Federation. College students and their families plan to spend an average of $969.88, or about $82 more than last year’s $887.71 average.

Here’s a lesson on saving when back-to-school shopping online.

Shopping for school supplies, electronics and clothing can be a chore — and an expensive one at that.

Families with children in grades K-12 plan to spend an average of $687.72 on back-to-school shopping, about $14 more than last year’s average of $673.57, according to the National Retail Federation. College students and their families plan to spend an average of $969.88, or about $82 more than last year’s $887.71 average.

Incentives such as discounts and free shipping make online shopping an attractive option.

“Retailers are trying to cater to everything that will make the consumer happy,” says Ana Serafin Smith, senior director of media relations at the NRF.

Here’s a lesson on saving when back-to-school shopping online.

Go bargain hunting

You wouldn’t want to buy a pack of notebooks only to spot the same item elsewhere for half the cost. Fend off buyer’s remorse by shopping around before you click the “order” button. Google Shopping can help you compare the costs of items on your list between retailers, or find coupons with a browser extension like Honey. Remember to factor shipping costs into the comparison.

Ask for a price match

If you find separate retailers selling an identical item at different prices, or if there’s a discrepancy between the same retailer’s prices in store and online, ask the site with the higher price for a reduction.

Retailers with price-matching policies — including Target, Best Buy and Newegg — will honor a competitor’s lower advertised price or reimburse you the difference on eligible items if you can provide proof of the amount within a specific time frame. At Staples, you’ll get the lower price plus 10% of the difference. Call the retailer’s customer service number for help price matching your online order.

Pursue student discounts

Students — and sometimes parents, faculty and staff — can save or score freebies by shopping on sites with student discounts or promotions. For example, Apple is discounting select Macs by up to $300 and the iPad Pro by up to $20, plus throwing in wireless Beats headphones for free with eligible purchases through Sept. 25. Check other retailers or student discount networks like Unidays for deals on electronics, supplies, clothing and more.

Buy online, pick up in store

If you order back-to-school supplies online and pick them up in store, many retailers will give you free shipping or order discounts, or will send you a coupon for a future purchase. On Walmart’s website, look for items marked “free pick up and discount”: At the time of this writing, we spotted an Acer touchscreen laptop for $251.65 with a $67.93 pickup discount, lowering the price to $183.72.

Rent materials or buy used

Newer isn’t necessarily better, at least not for your wallet. You can save on textbooks, calculators, clothing and other back-to-school staples by renting or buying them used. Explore options and pricing on sites such as Chegg, Amazon and Poshmark.

Bypass sales tax

This year, more than a dozen states are waiving sales tax on eligible back-to-school items — such as clothing, books and laptops under a certain amount — during sales tax holidays. Some areas waive local sales tax, too. These events typically last for a few days in late July or early August, both in stores and online. For example, Ohio and Virginia both offer tax-free weekends Aug. 4-6. If you live in a participating state, consider timing your back-to-school purchases around the holiday, and check the list of tax-exempt items and cost limits first.

You can still strategically time back-to-school purchases if your state doesn’t take part or you miss the window. The shopping season’s peak savings usually last through August into September, closer to the start of the school year.


The article Save More When Back-to-School Shopping Online originally appeared on NerdWallet.

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Financial Steps to Take Before Buying a Car

Think about the effort it takes to search for the right new car and to negotiate the lowest price. Here are a few things to consider while looking for the best financing option.

Think about the effort it takes to search for the right new car and to negotiate the lowest price.

Unless you plan to pay cash in full, the third leg of the stool is finding the best possible financing. Because loans typically come in 12-month increments, we’re talking about a decision that will affect your household budget a minimum of two years and probably more like five or six.

Here are a few things to consider while looking for the best financing option:

Assess your credit

Your credit score is likely the single biggest factor a lender will consider in determining what interest rate to offer you. Your score is based primarily on your credit reports, which you can get for free by visiting AnnualCreditReport.com.

Check the reports for errors and take action to dispute any that you find, because a higher credit score usually leads to a lower interest rate on a loan.

Get preapproved for a loan

Borrowing options usually boil down to working with a financial institution or with the dealership. Too many people assume the latter is their only option. But you can find a loan at banks as well.

For customers with excellent credit, dealerships sometimes offer low- or even no-interest rates. On the other hand, dealers’ rates can be markedly worse than those available elsewhere.

If you go through a bank, ask for a preapproval letter. Walking into the dealership with that in hand gives you more bargaining power to negotiate a better price.

Decide what to do with your old car

If you have a vehicle already, trading it in may be enough to cover a down payment or at least serve as a credit against the cost of your new ride. Sites such as Kelley Blue Book and Edmunds can help you appraise the trade-in value.

The dealer may well offer less — sometimes substantially less — than you could get by selling your old car privately. The tradeoff is you’ll have the inconvenience and uncertainty of dealing with strangers.

Figure out how much you can afford

Take a look at your financial situation to determine how much vehicle you can afford. What other living expenses, such as mortgage or rent, utilities and other recurring payments already have a claim on your income?

When calculating costs, you might also check with your insurance agent about rates. Why? Because in addition to your driving record, insurance rates can vary depending on a vehicle’s maintenance costs as well as the history of claims tied to your specific make and model.

Buying a new car is a major financial commitment, typically second only to purchasing a home. Taking time to figure out how much car you can afford and finding the smartest financing are well worth the effort.

© Copyright 2016 NerdWallet, Inc. All Rights Reserved

We’re your local solution for automotive lending. Trust our Valley-based professionals for quick turnaround time and local decision making.

Why Payday Loans Don’t Make Financial Sense

Life happens. The washing machine dies in the middle of a load, or you discover that your last visit to urgent care wasn’t covered by insurance. It’s not always possible to pay for these surprise expenses on the spot. This is when payday loans may become tempting. Here’s what you need to know about payday loans and why they shouldn’t be part of your financial strategy.

Life happens. The washing machine dies in the middle of a load, or you discover that your last visit to urgent care wasn’t covered by insurance. It’s not always possible to pay for these surprise expenses on the spot. This is when payday loans may become tempting.

Here’s what you need to know about payday loans and why they shouldn’t be part of your financial strategy.

What’s a payday loan?

Payday loans are small, short-term loans, often of $500 or less. They’re usually due within two weeks, or on your next payday. Many borrowers choose them because they’re so easy to get: Lenders don’t require collateral and rarely run credit checks. But you will pay for the convenience.

Most lenders charge a fee of $15 per $100 borrowed, according to a study done by the Pew Charitable Trusts. To be approved, you must allow the lender access to your checking account or submit a post-dated check for the amount you’re borrowing, plus the fees.

What’s so terrible about 15%?

Maybe you’re wondering what the big deal is: 15% sounds comparable to credit card interest. With payday loans, though, that 15% is due by your next payday, making your annualized interest rate almost 400%. If you can pay it back on time, one payday loan won’t bankrupt you, but if you don’t have that cash in two weeks, you can easily get trapped in costly ongoing debt.

In fact, more than 80% of payday loans are renewed or followed by another loan, with the borrower paying additional fees. This creates a vicious cycle of debt for those who can least afford it.

Statistically, people who take out payday loans are more likely to have relatively low incomes and long-term cash flow challenges.

Are there alternatives?

Payday loans are a bad deal, and if you need fast cash, you often have better options:

• Church-backed loans: Your church, temple, synagogue or mosque might offer small, low-interest emergency loans.
Life insurance loans: You might be able to borrow against an existing cash-value policy at low interest. You have your whole life to pay back these loans.
• Family/friend loans: Someone close to you might be willing to help.
• Payroll advances: Your employer might offer a cash advance on your salary.
• Personal loans: These installment loans are available through credit unions, banks and lending companies. They generally have fixed interest rates, don’t require collateral and provide comfortable repayment terms.
• Retirement accounts: The government allows you to withdraw funds from your IRA or 401(k) penalty-free, provided you put the money back within 60 days. This option only makes sense if you’re absolutely sure you can pay it back in time.
• Account or credit card advance: Your bank, credit union or credit card company might provide cash advances. Interest rates tend to be high, but are still lower than those for payday loans.
• Peer-to-peer lending: These online loans usually have high interest rates, but they’re also more affordable than payday loans.

Expenses often pop up at the worst possible times, but you don’t need a payday loan to bail you out. By exploring more affordable alternatives, you really can make it through today without stepping all over tomorrow.

© Copyright 2016 NerdWallet, Inc. All Rights Reserved

YToxOntzOjE3OiJ0cmlnZ2VyX3JldmlzaW9ucyI7czoxOiIxIjt9

Take advantage of the My Rewards™ platinum debit card and gain access to convenient short term loans!|fa-money|792|Short-Term Loans|1