Spring 2014
F E D E R A L D E P O S I T I N S U R A N C E C O R P O R A T I O N
More Ways to
Save at the Bank
Ideas for ...
g Adding to Savings and Investments
g Checking Out a Checking Account
g Keeping Mortgage Costs Down
g Refinancing Different Kinds of Loans
Tips for Safe Shopping,
Buying and Paying
• Simple Ways to Protect
Yourself
• Person-to-Person (P2P)
Payments Online
• More About Data Breaches
ALSO INSIDE
F E D E R A L D E P O S I T I N S U R A N C E C O R P O R A T I O N
More Ways to
Save at the Bank
Ideas for ...
g Adding to Savings and Investments
g Checking Out a Checking Account
g Keeping Mortgage Costs Down
g Refinancing Different Kinds of Loans
Tips for Safe Shopping,
Buying and Paying
• Simple Ways to Protect
Yourself
• Person-to-Person (P2P)
Payments Online
• More About Data Breaches
ALSO INSIDE
2Spring 2014FDIC Consumer News
MORE WAYS TO SAVE AT T H E B A N K
Finding money to put into savings
can seem difficult, but there are some
strategies that can make it easier. Start
by asking yourself these questions.
Do I have savings goals? Knowing how
much you want to save and why can
help you stick to a plan.
For example, if you have a young child,
ask yourself if you plan to help pay for
college. Research indicates that children
who have a college savings fund are
more likely to go to college than those
who don’t. Start by looking at “529
plans” sponsored by your state (typically
with cost and tax benefits for residents)
and compare them to other 529 plan
options. Learn more about college
planning at www.studentaid.ed.gov/
prepare-for-college.
How can I spend less? Review how
much you spent in the last month and
consider ways to cut back. “Start by
reviewing recurring expenses — even
small ones — and determine what you
might be able to cut out, downgrade,
or find a better deal on elsewhere,” said
Luke W. Reynolds, Chief of the FDIC’s
Outreach and Program Development
Section.
Also try to pay less in interest. For
example, if you have multiple loans, pay
off the ones with the highest interest
rates first. And, regularly reviewing
your credit report and correcting
errors (see the back page) can result
in considerable savings on loans and
insurance policies. For more about
saving money on loans, see the articles
on Pages 3 and 4.
Do I have an emergency savings fund?
Financial experts generally recommend
that you have at least six months of
living expenses in a federally insured
product, such as a savings account or a
certificate of deposit (CD). The idea is
to help you withstand a major reduction
in income, such as from a job loss, or to
pay for a major, unexpected home or car
repair. To build your “rainy day fund,”
consider a combination of regular,
automated deposits and any “windfalls”
you receive, perhaps from a tax refund
or a bonus at work.
Saving and Investing for Your Future:
Questions to Ask Yourself Now
Am I saving money on a regular basis?
“Automatic transfers into savings on a
set schedule can help you save money
before you spend it,” said Bobbie Gray,
an FDIC Supervisory Community
Affairs Specialist.
How much investment risk am I
willing to take? Investments such as
stocks, bonds and mutual funds can
produce higher returns than bank
deposits over many years, but you
could also lose some or all of that
money. (Remember, nondeposit
investments are not insured by the
FDIC against loss.)
In general, the longer you plan to keep
money invested and the greater your
tolerance for volatility, the more likely
these investments can help you reach
your targets.
Am I saving enough for retirement?
For many, the answer is “no” even
when they think it is “yes.” Options
to save include workplace retirement
plans, Individual Retirement Accounts
(IRAs) offered by many banks and
investment companies, and the U.S.
Treasury Department’s new “myRA”
(MyRetirement Account) program.
The myRA account is a simple, safe and
affordable retirement savings program
that is backed by the U.S. government.
Savers can open an account with as little
as $25, there are no fees, the account
will earn interest at a variable rate,
and the investment is protected so the
account balance will never go down. To
learn more about myRA, go to www.
treasurydirect.gov/readysavegrow/
start_saving/myra.htm.
“Many working people can save
considerably on their taxes through
qualified retirement savings. And, if
your employer offers a retirement
savings program of any kind, find out
whether it will match your investment
contributions, and then don’t lose out
on any matches,” Reynolds added.
To learn more about ways to save, see
resources from more than 20 federal
agencies, including the FDIC, at
www.mymoney.gov. Q
Various reports suggest that it’s
getting harder to find free or low-cost
checking accounts. To help you get
the best deal on an account that meets
your needs, consider these questions.
What do I need most from a checking
account? “Make a list of the services
you need so you can select a checking
account that’s a good fit,” said Luke
W. Reynolds, Chief of the FDIC’s
Outreach and Program Development
Section.
Which banks should I consider for a
checking account? First, make sure
your current bank or prospective banks
are FDIC-insured, so your deposits are
protected if the institution fails. Next,
consider whether you prefer to bank in
person, which means you might want
a bank with branches close by, or if a
distant bank with online services and a
convenient network of free ATMs will
meet your needs.
“Far-away banks may advertise high
interest rates or low fees, but don’t
overlook banks in your community,
including smaller banks,” said
Bobbie Gray, an FDIC Supervisory
Community Affairs Specialist. “Just
because a local bank doesn’t advertise
online doesn’t mean it may not be
offering free or low-cost checking.”
How can I compare the costs of
different banks’ checking accounts?
Review each bank’s disclosures of fees
Checking Accounts:
More Questions to Ask
MORE WAYS TO SAVE AT T H E B A N K
Finding money to put into savings
can seem difficult, but there are some
strategies that can make it easier. Start
by asking yourself these questions.
Do I have savings goals? Knowing how
much you want to save and why can
help you stick to a plan.
For example, if you have a young child,
ask yourself if you plan to help pay for
college. Research indicates that children
who have a college savings fund are
more likely to go to college than those
who don’t. Start by looking at “529
plans” sponsored by your state (typically
with cost and tax benefits for residents)
and compare them to other 529 plan
options. Learn more about college
planning at www.studentaid.ed.gov/
prepare-for-college.
How can I spend less? Review how
much you spent in the last month and
consider ways to cut back. “Start by
reviewing recurring expenses — even
small ones — and determine what you
might be able to cut out, downgrade,
or find a better deal on elsewhere,” said
Luke W. Reynolds, Chief of the FDIC’s
Outreach and Program Development
Section.
Also try to pay less in interest. For
example, if you have multiple loans, pay
off the ones with the highest interest
rates first. And, regularly reviewing
your credit report and correcting
errors (see the back page) can result
in considerable savings on loans and
insurance policies. For more about
saving money on loans, see the articles
on Pages 3 and 4.
Do I have an emergency savings fund?
Financial experts generally recommend
that you have at least six months of
living expenses in a federally insured
product, such as a savings account or a
certificate of deposit (CD). The idea is
to help you withstand a major reduction
in income, such as from a job loss, or to
pay for a major, unexpected home or car
repair. To build your “rainy day fund,”
consider a combination of regular,
automated deposits and any “windfalls”
you receive, perhaps from a tax refund
or a bonus at work.
Saving and Investing for Your Future:
Questions to Ask Yourself Now
Am I saving money on a regular basis?
“Automatic transfers into savings on a
set schedule can help you save money
before you spend it,” said Bobbie Gray,
an FDIC Supervisory Community
Affairs Specialist.
How much investment risk am I
willing to take? Investments such as
stocks, bonds and mutual funds can
produce higher returns than bank
deposits over many years, but you
could also lose some or all of that
money. (Remember, nondeposit
investments are not insured by the
FDIC against loss.)
In general, the longer you plan to keep
money invested and the greater your
tolerance for volatility, the more likely
these investments can help you reach
your targets.
Am I saving enough for retirement?
For many, the answer is “no” even
when they think it is “yes.” Options
to save include workplace retirement
plans, Individual Retirement Accounts
(IRAs) offered by many banks and
investment companies, and the U.S.
Treasury Department’s new “myRA”
(MyRetirement Account) program.
The myRA account is a simple, safe and
affordable retirement savings program
that is backed by the U.S. government.
Savers can open an account with as little
as $25, there are no fees, the account
will earn interest at a variable rate,
and the investment is protected so the
account balance will never go down. To
learn more about myRA, go to www.
treasurydirect.gov/readysavegrow/
start_saving/myra.htm.
“Many working people can save
considerably on their taxes through
qualified retirement savings. And, if
your employer offers a retirement
savings program of any kind, find out
whether it will match your investment
contributions, and then don’t lose out
on any matches,” Reynolds added.
To learn more about ways to save, see
resources from more than 20 federal
agencies, including the FDIC, at
www.mymoney.gov. Q
Various reports suggest that it’s
getting harder to find free or low-cost
checking accounts. To help you get
the best deal on an account that meets
your needs, consider these questions.
What do I need most from a checking
account? “Make a list of the services
you need so you can select a checking
account that’s a good fit,” said Luke
W. Reynolds, Chief of the FDIC’s
Outreach and Program Development
Section.
Which banks should I consider for a
checking account? First, make sure
your current bank or prospective banks
are FDIC-insured, so your deposits are
protected if the institution fails. Next,
consider whether you prefer to bank in
person, which means you might want
a bank with branches close by, or if a
distant bank with online services and a
convenient network of free ATMs will
meet your needs.
“Far-away banks may advertise high
interest rates or low fees, but don’t
overlook banks in your community,
including smaller banks,” said
Bobbie Gray, an FDIC Supervisory
Community Affairs Specialist. “Just
because a local bank doesn’t advertise
online doesn’t mean it may not be
offering free or low-cost checking.”
How can I compare the costs of
different banks’ checking accounts?
Review each bank’s disclosures of fees
Checking Accounts:
More Questions to Ask