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Budgeting 101 For Young Adults

Budgeting 101 for Young Adults

Budgeting 101 for Young Adults

You’ve taken all the tests, memorized all the vocabulary, and made your way across the stage. But what comes next? After graduation there are many questions that come with your diploma. Things like, how am I going to pay for rent? Or, how much should I budget each month for food? Not everything in life is as simple as A, B, C, or D. That’s why Timberwood Bank is excited to help young adults with the complex questions of budgeting and personal finance. Find the answers to your financial curiosities with our handy Budgeting 101 study guide!

  1. Identify money coming in. Look past the salary or hourly rate on your contract and focus on take-home pay. How much will you bring in after taxes? When do you see this pay-off – weekly, biweekly, or monthly? Factor in other sources of cash flow too, like earned interest or paychecks from a part-time job. Understanding what you own dictates how you spend.
  2. Establish money going out. Divide monthly expenses into three major categories: fixed costs, savings, and discretionary. Rent, utilities, food, gas, and debt comprise the fixed costs and determine funds for the remaining categories. Savings should include an emergency fund as well as allocation for retirement or down payments on vehicles or homes. Discretionary – the Fun Fund – is the most flexible and can ebb and flow with changes in income and expenses.
  3. Balance steps 1 & 2. The purpose of budgeting is to provide control over your financials. That means ensuring that money going out doesn’t exceed money coming in to keep your head above the debt line. If you find your listed expenses exceed your income, pick one of two options: seek ways to boost income or scale back expenses.
  4. Pick a management system. Armed with a financial plan, equip yourself with tools to help you stick to it. Traditional but trusted, the envelope method helps you keep funds in physically separated expense categories. Once money runs out from that month’s envelope, it’s gone unless funds can shift from other envelopes. A number of free or low-priced mobile apps can give you even tighter control of your budgeting, providing real-time updates of spending and handy visuals of your progress.
  5. Track progress. A long-term financial plan is simply a series of short-term goals. Monthly check-ups help you gauge success from the month, making sure you stayed on target. You can adjust funds as income or expenses fluctuate and spot ways to economize your budget.

Want to take your budgeting up a notch? Meet with one of our Personal Bankers, who will work with you to plan a secure financial future. Give us a call to set up your appointment today!

Top 10 Tweaks to Add Value to Your Home

Top 10 Things to Add Value

Just like purchasing your home, selling it is a journey all its own. Whether you’re aiming to sell your home in one year or five, you can make a number of small changes that offer a big return on your home’s value. Try these key improvements and see the effect on your next home assessment.

  1. An eye-catching entrance. As the gateway into your home, your front door will set the tone for what’s within. Update your door bell, paint the front door, and hang a spring wreath to tie it all together.
  2. Energy-efficient updates: Updating appliances, windows, and fixtures, to their more green counterparts can set your home apart with the attractive promise of future savings.
  3. Low-maintenance landscaping: While flowers are eye-catching, shrubs and drought-resistant greenery make great visual impact with the promise of less hassle.
  4. A thorough clean. A deep clean of carpets, curtains, and corners will make your home sparkle and create a positive first impression. Hiring a professional cleaning service may also help to remove hard-to-clean grime and overlooked areas.
  5. De-cluttered rooms. A tidy house doesn’t always feel open. Heavy curtains, overstuffed couches, and rooms devoid of sunlight can make buyers cautious of square footage. Rid the room of nothing but bare essentials and simplistic furniture to maximize the area of the space.
  6. Extra mirrors. To double the feel of any room, strategically place mirrors to create an illusion of extra space.
  7. Small updates to big places. Kitchens and bathrooms are focal points in the selling process. Without the time and cost of a major remodel, small updates like new lighting, fresh paint, or modern accessories can add value to your home on a budget.
  8. Revamped flooring: Thin or threadbare carpets can raise alarms for buyers as they visualize the daunting need to replace the tired flooring. As your budget allows, replace your home’s carpet beginning high-traffic areas and working outwards.
  9. Modern lighting. Updating light fixtures to a timeless and simple feel, help to elevate a home’s design and gives the potential buyer a blank canvas to imagine life in their new home.
  10. A professional opinion. In under an hour, a trained interior designer can provide suggestions for small tweaks, such as furniture arrangement or paint color adjustments, which can increase your home’s value with limited investment.

While improvements are not a guarantee of improved value, they can make all the difference when drawing in interested buyers. If some of your home-improvement projects require a bigger investment than your budget expected, our lending officers at Timberwood Bank can work to help you secure the Home Equity Line of Credit you need.

How-To Give Your Child a Financial Education with Their Allowance

Financial Literacy

Allowance, when treated as an educational opportunity, gives your child hands-on experience in budgeting, saving, spending, and tracking their money. With these tactics, you and your child can make the most of their allowance while growing their financial literacy.

  • Shy away from weekly allowance. A bi-weekly or monthly allowance better reflects a real-world payment schedule than a weekly handout. Additionally, staggered money instead of a steady cash flow opens opportunities to practice budgeting for both spending and savings goals.
  • Pay financial, not household, chores. Paying your children for completing basic household duties can shift their helpfulness from intrinsic to monetary. Instead, link their allowance to financial chores, or spending responsibilities that they take off your hands. While you cover school lunch and back-to-school clothes, vacation souvenirs or sporting event concessions are up to their discretion, allowing them to make financial decisions from a young age.
  • Open a savings account. It’s never too early to start saving. Open a saving’s account with your child and explain the power of compound interest. Establish that they pull 10% of their total monthly allowance to funnel into savings, enabling them to budget the remaining 90% while teaching the discipline and value of saving.
  • Show them the options for their funds. Teach your children the potential their money has by creating four labeled jars for spending, saving, giving, investing. Each time your kids are given money via chores or other revenue sources, have them choose which jar to put the funds in. The spending jar can be used on small purchases like candy bars or little toys, and the saving jar can be put towards larger items that take more time to save.

With each dollar your children learn to save, they will continue to propel their education forward. If you’d like to get your little one’s financial education off to the right start stop by Timberwood Bank today and enroll them in their very own savings account.

Taking Baby Steps to Eliminate Your Debt

Shrinking Debt

As of 2015, the average American with credit card debt  owes $15,762 – and that’s just credit. Auto loans, student loans, and mortgages add thousands of dollars and years of repayment to your personal finances. However, debt doesn’t have to be a life sentence. Once you and your partner have made the commitment to work towards financial freedom, follow these steps from Timberwood Bank to begin eliminating debts.

  1. Establish an emergency fund immediately. Unexpected events can take a harder hit on your savings than unbudgeted spending habits ever could. Even if you’re juggling a current debt or two, work to set aside $1,000 as soon as you can in a separate emergency checking account. As you chip away at remaining debt, this cushion can protect repayment plans from being flattened by a faulty car battery or flooded basement.
  2. Adopt the debt snowball method. Instead of listing them highest to lowest by interest rates, arrange debts from smallest to largest. Paying off a handful of small debts in the same time it’d take to chip away at a large one eases burdens, yields immediate results, and provides motivation to continue saving.
  3. Reduce your rates. Refinancing your mortgage and negotiating lower interest rates on credit cards. Reevaluating your health, life, and auto insurance policies may reveal services you don’t need, or it can spur you to shop around for providers with lower rates.
  4. Chop extraneous expenses. Create a list of unavoidable monthly expenses – rent, utilities, gas, food. Create a second list of leisure expenses – gym memberships, cable, eating out, clothing. After budgeting for the necessities, pick a few discretionary categories you’d like to keep with reduced spending, but cut the rest. Putting your spending on a diet is easier when you allow yourself a few modest outlets.
  5. Evaluate progress monthly. Creating a multi-year financial plan for eliminating debt is the first step, not the only one. Perform a monthly check-up on your plan to continue spending within your budget. It can also provide a boost of encouragement when you see progress, and you might spot ways in your new financial routine to make your budget even more cost-effective.

It may be a long road to eliminate debt, but it’s within your ability to travel it. Don’t go it alone – contact one of our advisers today to help you create and stick to your financial plan.

Beginning Spring Renovations with a Home Equity Line of Credit

Home Equity Loan

With warm weather approaching spring is the ideal time to shake off the dust and get your house back into shape! Get started on your next home renovation with a strategic Home Equity Line of Credit from Timberwood Bank. Our custom financing allows you withdraw only the funds you need along the course of your future project. Inspiration can be found everywhere when updating common areas such as the kitchen, bathrooms, basement, or outdoor living area. See what these average home renovations cost with this handy guide courtesy of Timberwood Bank.

Kitchen Remodel: Creating your ideal culinary environment is more than just choosing cabinets and granite. With all the updates and finishing work, a typical Midwestern kitchen remodel can cost around $15,000 to complete. Carefully crafting the heart of your home takes concentrated decision making and long term planning. Consider updating your kitchen appliances to save you time and energy while preparing future meals. You may want to refinish or replace worn out flooring to match the new feel of your fresh remodel.

                Bathroom Remodel: Giving your common space a much needed facelift can help you add value to your home. With updates as simple as new hardware and a tasteful backsplash you can bring some timeless style to a functional space. When undertaking a full renovation, features like a walk-in shower or a double vanity can bring a bold statement to the room. The average bathroom remodel in Wisconsin typically runs under $10,000 for a completely revamped space.

                New Deck: Building a fun outdoor patio or deck can open up the area for countless fun family activities. Costing around $6000 for the average Midwestern deck, you can complete this exciting renovation in time and under budget. Spice up your new construction with added rails to hold beverages or food during grill outs and get-togethers.

                Finishing a Basement: Depending on your foundation and other structural issues, most basement renovations center on adding dry wall, placing new flooring, and waterproofing the entirety of the room. Typically costing under $25,000, a finished basement can serve as additional space for an office or play room, increasing the livable square footage of your home.

There are endless projects to begin your spring to-do list this season. Let Timberwood Bank help you get started on your next home renovation with a tailored Home Equity Line of Credit. Speak with one of our helpful lenders to get started today!

The Ultimate Guide to Garage and Yard Sales

Yard Sales

With pockets full of dollar bills and a list of dream finds in hand, serious garage sale goers are perking up for the upcoming season. Become a pro deal-spotter by harnessing some of their top tricks of the trade!

  • Check for warranties: Even if they’re dinged or damaged, goods by brands like Craftsman and Chaco may offer lifetime warranties if you send them in for repair. Avoid: Electronic-based gadgets – everything from blenders to tablets – as they’re likely past warranty andcost more to repair than buy new.

 

  • Snap up fun novelty items: Infrequently used finds like wedding accessories, costume sets, and kitchen appliances can be pricey when purchased brand new. You can buy these gently-used finds for a fraction of the original cost! Avoid: Holiday-themed wares that you’ll use once, store for the year, and toss out at your own yard sale.

 

  • Think a few seasons ahead: A summer yard sale will be loaded with wintertime treasures. Scope out pricier outerwear like parkas and boots, while keeping your eye out for cross-country skis, durable metal shovels, and other seasonal goods marked at a steep discount. Avoid: Cold weather apparel worn close to the skin, such as hats and long underwear. Also, be wary of major items like snow blowers and snowmobiles, which may require costly repairs that outweigh the price of a newer model.

 

  • Shop for the kids: When they’re set to outgrow clothes every few months, garage sales are a treasure trove of inexpensive apparel for infants through teens. Be on the lookout for limited-use clothing like costumes and formalwear to save big during special occasions. Avoid: Cribs and car seats which are frequently recalled, soft toys that can’t be easily washed or sterilized, and truly vintage toys which may pose the risk of lead-based paint.

 

  • See Beyond the Paint: Furniture can be a phenomenal find if you’re willing to put in some extra effort. A new finish or a fresh coat of paint can make all the difference on wood & metal pieces. Avoid: Mattresses and upholstered items which may have unknown stains or trapped in odors.

Online Banking Made Easy

eStatementsTechnology is a constantly evolving medium, and we’re continuing to grow with it! At Timberwood Bank we offer a variety of digital tools for our customers. Take a look and discover a new way to manage your finances through our online technology!

Online Banking: Conveniently access all your banking accounts through our secure online portal. Not only does this give you a quick and easy way to manage your finances but it’s also where you can view a complete account history, transfer funds, and more!

Mobile Banking: Enjoy all the perks of online banking from the comfort of your mobile device. This easy mobile tool allows you to keep up on your finances while you’re away or during your busy day.

Online Bill Pay: Tired of writing checks for your monthly expenses? With our Online Bill Pay you can schedule recurring payments and take the hassle out of paying your monthly expenses. Go through our easy setup process and you can start paying bills directly from your Online Banking account!

Online Loan Applications: You can now apply for a home loan online, from anywhere!  Simply visit our mortgage page on our website and follow the easy step-by-step process.

E-Statements: Make a difference and go green with our E-statements at Timberwood Bank. Not only are you helping the environment, but our E-Statements offer a quicker, simpler process to obtain your monthly statements.

Text Banking: Utilize our quick and easy text messaging service to receive account balances and recent history. Any phone with texting (SMS) capabilities can be used with our Text Banking.

Here at Timberwood Bank it’s all about YOU, our customers! We love the ease and simplicity these products offer for the everyday financial tasks. We would love to help you find the best product solution for your individual needs!

Say “I Do” to Post-Honeymoon Finances

Post Honeymoon Finances

After tying the knot, finances can be a tricky subject, but they are an absolutely necessary discussion. As Dave Ramsey says, “If you can talk about money, you can talk about anything.” Getting your finances put together takes some decision making, but here are some basic guidelines to get you started courtesy of Timberwood Bank.

Be transparent with one another.

Begin the conversation with sharing each of your individual financial states, and the goals you have for where you want to be in the coming years. Once everything is out on the table you are able to dissect the differences between your finances and discover any areas that perhaps you differ on. If one of you has debt and the other does not, then you are able to build a plan to first eliminate your now joint debt. By being open with one another you can communicate more efficiently and work toward the goals you each share.

Evaluate your account setup.

In today’s world the words “joint checking” don’t always apply. While most common among married spouses with children, a joint checking account can provide a larger sum for paying expenses and saving toward goals. Additionally, spouses today are also utilizing a combination of joint and separate accounts to maintain relative independence and have access to personal spending funds. Some couples choose to select separate accounts for all their financial means, paying bills fifty-fifty or perhaps every other. Whichever account scenario you choose, ensure that you and your spouse are on the same page, establishing ground rules and acceptable spending habits.

Make a plan and stick to it.

At least once a month set aside time in your day to discuss finances with your spouse. This helps alleviate any financial tension should any money situations arise. By openly discussing successes and failures in your household finances on a regular basis you maintain a level of security in seeing where you finances stand in conjuncture with your goals each and every month. To be successful with your finances, you and your spouse must create and maintain a household budget. When creating your monthly budget remember to factor in costs for any loan installments, debt repayment, monthly expenses, and joint or separate savings. By evaluating your budget during your monthly finance discussions you can track you progress and adjust the budget if needed to better reach your joint financial goals.

By utilizing these simple tips you will begin the path to financial security and grow in your monetary capabilities. As Ramsey says, “Marriage is a partnership, and couples can’t win with money unless they’re doing the budget as a team.”

Spring Into Spring

Spring Into Spring

Shake off colder temps, for spring has sprung! Squeeze the most out of this blooming season with these warmer weather activities to help you unthaw:

  1. Declutter your closet. To make it more open and airy, purge your wardrobe of all the clothes you didn’t wear over the winter. Donate the castoffs and make room for summer essentials.
  2. Try your hand at Frisbee golf. Running around on a grassy course soaking up the fresh air. Frisbee golf is the perfect cure to your winter blues. Grab some friends and some discs and you’re in business!
  3. Road trip to a bizarre local attraction. If famous landmarks like the World’s Largest Cheeto or Ice Cream Capital of the World are just an hour or two away, why not seize the day? Hop in your car, roll down your windows, and take a mini road trip to visit a nearby town’s pride and joy.
  4. Visit a greenhouse. Waiting until the summer to start your garden limits your options. Stretch your growing season by visiting a greenhouse, where you’ll find new plants, flowers, and produce seedlings to add to your bounty.
  5. Go mushroom hunting. Morel mushrooms grow all across the United States and sprout in the spring, making them a seasonal delicacy. Never gone hunting before? It’s easy!
  6. Get together for a grill fest. Dust off and light up your grill to celebrate warmer temperatures with friends and family. Challenge each guest to bring a dish designed for the grill so that every part of the meal – meat, veg, fruit, and dessert – is prepared outdoors.
  7. Catch a sunrise. With coffee and cocoa in tow, head to a nearby park or nature reserve to catch the sun as it rises over budding trees and new wildlife. Go all-out cooking up a delicious breakfast spread after the main event.
  8. Hit up flea markets and garage sales. One man’s trash is another man’s weekend discovery. As your neighbors spring clean, snap up items from the ridiculous to the sublime.
  9. Wash the cars. There’s something innately satisfying about watching months-worth of dust and sludge slide off a now-sparkling vehicle. Involve the whole family in the scrubbing and splashing, and reward them with ice cream at a local parlor afterwards.
  10. Get dirty. Whether it’s planting flowers, embarking on a DIY landscaping project, or simply sinking your hands and feet into gooey mud, nothing screams spring quite like dirt-streaked clothes. Embrace the mess!

Adventure is out there – go grab it! Be sure to share your favorite spring activity on our Facebook page and show us your favorite spring activity!

 

Daily Inspiration: Miracle on Ice

Miracle On Ice

Sometimes there are stories so inspiring they give you chills, make you want to go out and accomplish something spectacular simply because you now know the impossible can occur. In the financial realm of 2016 we believe anything is possible, and if you dream it, we want to help you achieve it.  So today if you’re a little short on motivation, enjoy this tale of the incredible feat by the 1980 U.S. Olympic Hockey Team, known as the Miracle on Ice.

In the summer of 1979 U.S. hockey coach Herb Brooks held auditions for the 1980 U.S. Winter Olympic Hockey Team. With a final roster of 20 young men, averaging an age of 21, the U.S. had its youngest team in history. Brooks decided to retain only one player from the prior Olympic team, Buzz Schnieder. Brooks knew that the U.S. was to be considered an underdog, and during the exhibition games he insisted the players learn a more European style of play to build strength and cohesiveness. In their final exhibition game on February 9, the U.S. played their future opponent, the Soviet Union National Team. They lost in an agonizing defeat of 10-3.

Once the Olympic Games began, the Soviet team paved their way to the top, scoring large leads against the majority of their opponents. During their first game, the U.S. team tied Sweden with a 2-2 game, pushing both teams forward. After several close games, the U.S. found themselves in the semi-finals playing against the Soviet Union National Team, which had defeated them less than two weeks prior.

In the first period of the game, the Soviets managed to sink a puck and gain the first lead. The U.S. managed to gain a goal, keeping toe-to-toe with the Soviets after another goal, eventually ending the period in a 2-2 tie with a last second goal by the U.S. In the second period the Soviets again took the lead gaining one culminating goal. After only eight minutes in the final period, the U.S. found its momentum. Through an incredible power play the U.S. earned a goal, and then another only minutes later. The Soviets began to panic, yet Brooks kept his players calm. He continued to keep the U.S. on offense making several other attempts on goal, repeating to his players, “Play your game! Play your game!”

As the seconds of the final period counted down, the sportscaster for ABC, Al Michaels joined in, famously saying, “Do you believe in miracles?! YES!!!!” When the final buzzer rang the field house was filled with exclamations from the U.S. fans as the players stormed the ice, cementing the moment as one of the best sports moments in the 20th Century.

After the game, sports anchor Jim McKay shared a comparison of the game as a group of Canadian college football players defeating the Pittsburgh Steelers.

Against all odds and predictions, the 1980 U.S. Winter Olympic hockey became a real life David and Goliath, knocking down the Soviet Union National Team and making hockey history. The U.S. later went on to defeat Finland in the finals to gain the gold medal.

Anything is possible if you plan and work to achieve your goals. We are happy to share this incredible tale to inspire you to reach for the stars. Share you financial aspirations with us, and we will work to help you do what perhaps you never thought was possible.