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April 2017 E-Newsletter

What Do Rising Interest Rates Mean for You?

If you've been keeping up with news stories about the economy lately, you may have heard that the "Fed" has been raising rates, and is likely to do so more often in the future. What does this mean, and how will it impact the average consumer?
Who is "the Fed"?
The Federal Reserve is the central bank of the United States, which means it is owned by private banks and operates independently of the U.S. government. It is led by a Board of Governors who are appointed by the President. The Fed has three mandates: maximize employment, stabilize prices and moderate long-term interest rates. It accomplishes those mandates by raising or lowering the Federal Funds Interest Rate (the basis for every other interest rate out there), which is managed by the Federal Open Market Committee (FOMC). The FOMC meets eight times per year and issues a statement about the general U.S. economy and if the Fed will raise its rate. The March increase was just the third hike since 2006 (the first was in December 2015, the second in December 2016).
Does the Fed Funds rate impact me?
Yes. Even though consumers do not directly borrow money from the Fed, the banks that provide their car loans and mortgages do. Since the Fed Funds rate is the basis for other rates (by being the cost of what your bank must pay in order to get money) raising and lowering it affects the rates you, the consumer, can get from your bank. So, if you're in the market to buy a house and you hear that the Fed may be raising interest rates soon, you know to act quickly so you can secure a lower interest rate for your mortgage.
So are high rates bad?
No. While low interest rates on large purchases like homes are good for consumers, extended low interest rates (like we've seen over the past 10 years) means that the economy isn't growing very fast and consumers aren't earning much on their savings. When the Fed Funds rate goes up, depositors see increased interest rates on their savings accounts and CDs, so higher rates are a bonus for savers. It's also important to note the Fed raises rates a little at a time (usually only 0.25%) and the higher rates only affect new loans and loans with adjustable rate terms. Higher rates also mean the FOMC sees signs that the economy is getting stronger, which is good for everyone.
If you have any questions about how the Fed raising interest rates will affect your finances, be sure to speak to your bank. They'll be able to offer specific advice according to your accounts and circumstances.

Source: WBA Consumer Column E-Newsletter

How to Safeguard your Cash & Personal Info at ATMs

An ATM can be a lifesaver when you’re on the go and need some fast cash. But as helpful as these machines can be, they’re also magnets for fraudsters who are out to make a quick buck. In fact, criminals stole data from magnetic-strip debit cards at ATMs at the highest rate in over 20 years during the first several months of 2015, according to a report in The Wall Street Journal.
Here’s a closer look at what you can do to stop these criminals and ensure that your money stays where it belongs: in your wallet.
Keep an eye out for skimming devices
Performed by hackers around the world, card skimming is the tried-and-true method of copying the information from magnetic-strip credit and debit cards by inserting a device on top of a card reader slot. This gadget scans and stores card information, which fraudsters use to produce duplicate plastic to make unauthorized purchases or withdraw money from your account.
To make sure your ATM hasn’t been tampered with, take a quick but careful look at its card reader. Consider using only those machines that are in densely populated places and that are monitored by security cameras. Criminals might be less willing to place skimming devices into these types of machines. That also makes it a good idea to stay away from ATMs located at gas stations and other remote places where cameras aren’t used.
The new microchip-embedded EMV cards are designed to foil this type of counterfeiting. They encrypt your account information and also generate an authentication code that’s required before in-person purchases are approved. Even if a scammer were able to steal your data and make a counterfeit card, the fake plastic wouldn’t work without the required microchip.
Avoid loitering
After confirming that the ATM isn’t rigged, try to withdraw your cash as quickly as possible. That way, you’ll reduce your chances of attracting unwanted attention. It will also help to initiate the transaction knowing exactly how much money you want to withdraw.
Have your plastic’s personal identification number, or PIN, memorized and use your hand to shield the keypad as you enter it. If it’s late and you’re alone, consider waiting until you’re inside a locked car or other safe place to count your money. Keep a copy of your receipt in case you received less cash than you requested.
Monitor your checking account
Although good judgment and common sense will go a long way in ensuring safe ATM withdrawals, you can make sure fraudsters aren’t using your card info by regularly monitoring your online checking account.
If you happen to notice an ATM transaction that you don’t remember making, call your financial institution immediately. The company should be able to investigate and refund any lost money within a few weeks.
The takeaway
The continued use of card skimmers means consumers must be vigilant when using magnetic-strip cards at ATMs. In a rush to get cash, it can be easy to forget the basics, such as covering the keypad and making sure that there aren’t any suspicious individuals lurking nearby.
By making the aforementioned moves, you’ll be doing everything in your power to protect yourself and your money. And don’t fret if you spot a strange transaction in one of your statements. Stay cool and call your financial institution immediately.
© Copyright 2016 NerdWallet, Inc. All Rights Reserved

Business Corner: What is a Working Capital Loan?

Working capital, or the cash required to cover day-to-day expenses, is the lifeblood of a small business. Figuring out how much you have is a straightforward calculation: assets minus liabilities equals working capital.
But while that equation is constant, the bottom line — how much working capital you have available — is often in flux. And when times are tough, you may need a loan to see you through until revenues rebound.
A working capital loan can help by serving a variety of purposes, from short-term needs such as covering payroll or rent to longer-term investments in equipment or expansion.
The conventional school of thought is that it’s a mistake to use working capital loans for fixed overhead costs like rent and payroll, on the theory you shouldn’t rely on debt to sustain your business.
Still, there may be exceptions. Yours may be the type of business that runs hot and cold depending on the time of year or other supply-and-demand cycles. Or perhaps you’ve just hit an unexpected slow patch and are short on cash to cover everyday expenses. Maybe a marketing opportunity has arisen, or some accounts receivable have been slow to pay and you need to make up the deficit.
The best way to deal with a cash-flow crunch would be to draw from a line of credit with your local bank or credit union, because these institutions offer the best financing rates. But if you don’t have a line of credit and need working capital fast, there are options.
The Small Business Administration is another source, with loans contingent on the nature of the business and the standing of its ownership. A downside to turning to the SBA, though, is the length of time the government typically takes to process a loan application.
You likely already keep regular tabs on your business’s financials, analyzing the balance sheet and profit-and-loss statement. If what you’re seeing suggests a shortfall, or a view of the landscape reveals an opportunity, consider a working capital loan.
© Copyright 2016 NerdWallet, Inc. All Rights Reserved

Best Ways to Use a Tax Refund

Over the past few years, the average federal tax refund has come to about $3,000. That’s not exactly chump change. With the filing deadline approaching, it’s not too early to begin thinking about how you’ll use a refund this year. Here are five pointers to keep in mind.
1. Pay down debt
It’s not as much fun as booking a trip to the Caribbean, but cutting down the amount of debt you owe is one of the best money moves you can make. Outstanding loan and credit card balances can hurt your credit score, making it more difficult to get the best rates on new borrowing. If you’re saddled with credit card debt, consider paying off the balance with the highest interest rate first.
2. Save for retirement
Whether it’s a 401(k) plan or an individual retirement account, you’ll do yourself a huge favor by starting to save for retirement or ramping up your savings rate. Although putting away 10% of your pre-tax income is a good starting point, you’ll eventually want to approach 20%. Compound interest and investment returns help the money in these accounts grow, so you’ll thank yourself once you retire.
3. Home improvement
If you’re a homeowner, taking care of repairs around the house can be a great long-term investment. Just remember to be strategic when it comes to deciding what to fix. Replacing a garage door or installing a new steel entry door can be among the least expensive improvements, at less than $2,000 each on average. But they can provide some of the best returns on the dollar in terms of the market value they add to your home, according to Remodeling Magazine.
4. Save for emergencies
Because it’s best to leave money in retirement accounts alone so it can grow over the years, it’s important to build a rainy day fund. This should consist of three to six months of living expenses, and the money should be readily accessible. You might be forced to use these funds when you least expect it, to handle medical emergencies or a broken down car that needs immediate repairs. A tax refund probably won’t cover half a year’s living expenses, so continuing to add to your emergency fund will help you hit your savings goal.
5. Focus on needs
As tempting as it may be to splurge on a new television, you’ll probably end up regretting using your refund for anything that lacks long-term value. That includes vacations, shopping sprees and decadent nights out on the town.
If you consistently receive substantial refunds but never put them to good use, consider asking your employer to adjust what’s withheld from your pay. That way, you’ll avoid giving the government too much money and can use it to cover more pressing needs.
© Copyright 2016 NerdWallet, Inc. All Rights Reserved

Coulee Bank's Q-Tip: Simple Steps to Avoid Being Phished

Phishing has become one of the most common risks of the internet, with even tech-savvy and cautious users falling victim. Being phished might lead to the theft of personal details like your social security number or banking passwords — and it can also put your business at risk as well.

So how does phishing work? Most commonly, users receive a “spoofed” email that appears to come from a legitimate website they frequently have online dealings with, like their bank, credit card company, or ISP, or in some cases even their employer. The one thing these spoofed sites have in common is they require the user to have a personal ID or account. The phishing email informs the user their account is somehow at risk — that they may need a security update, or to reset their password.
The phishing email may also direct you to a spoofed website or pop-up window which looks exactly like the real site, but has been set up for the sole purpose of stealing personal information. Unaware that the site isn’t real, unsuspecting users are fooled into handing over credit card numbers, passwords, or other details.

According to the Anti-Phishing Working Group (APGW), the number of phishing attacks occurring every day are staggering. According to APWG’s most recent annual Global Phishing Survey, in 2014 there were 123,972 unique phishing attacks worldwide. Companies are under constant attack, receiving 1,000 or more phishing attempts per month. The speed with which phishing attacks are mitigated is up as well, which means they’re not being shut down during those critical first few hours of an attack.
Scam artists will use familiar brands, high profile names, identifiable logos, and more to make their messages look legitimate, but there are a few ways to spot a phishing attempt. According to the U.S. Security and Exchange Commission, common phishing tactics include:
  • Using the name of a real company, as well as the company’s signature look and feel
  • Making the email appear to come from an actual employee, using the names of real people working for the company
  • Using spoofed URLs that “look right”
  • Creating a sense of urgency to cause a fear reaction from the recipient

How to protect yourself
  • Never respond to emails that request personal financial information
Banks or e-commerce companies generally personalize emails, while phishers do not. Phishers often include false but sensational messages, (e.g., "Urgent - your account details may have been stolen") in order to get an immediate reaction. Reputable companies don't ask their customers for passwords or account details in an email. Even if you think the email may be legitimate, don't respond. Contact the company by phone or by visiting their website. Pick up the phone and speak to a real person, or type the URL in yourself by hand rather than clicking a link in a suspicious email.
  • Visit bank websites by typing the URL into the address bar
Phishers often use links within emails to direct their victims to a spoofed site, usually to a similar address such as instead of When clicked on, the URL shown in the address bar may look genuine, but there are several ways it can be faked, taking you to the spoofed site. If you suspect an email from your bank or online company is false, do not follow any links embedded within it.
  • Be cautious about opening attachments and downloading files from emails, no matter who they are from
  • Keep a regular check on your accounts
Regularly log into your online accounts and check your statements. If you see any suspicious transactions, report them to your bank or credit card provider.
  • Check the website you are visiting is secure
Before submitting your bank details or other sensitive information, there are a couple of checks you can do to help ensure the site uses encryption to protect your personal data.
  • Check the web address in the address bar. If the website you are visiting is on a secure server it should start with "https://" ("s" for security) rather than the usual "http://."
  • Also look for a lock icon on the browser's status bar. You can check the level of encryption, expressed in bits, by hovering over the icon with your cursor.
  • Note that the fact that the website is using encryption doesn't necessarily mean that the website is legitimate. It only tells you that data is being sent in encrypted form.
  • Be cautious with emails and personal data
Most banks have a security page on their website with information on carrying out safe transactions, as well as the usual advice relating to personal data.
  • Never let anyone know your PINS or passwords
  • Do not write them down
  • Do not use the same password for all your online accounts 
Avoid opening or replying to spam emails, as this will give the sender confirmation they have reached a live address. Use common sense when reading emails. If something seems implausible or too good to be true, then it probably is.
  • Keep your computer secure
Some phishing emails or other spam may contain software that can record information on your internet activities (spyware) or open a 'backdoor' to allow hackers access to your computer (Trojans). Installing antivirus software and keeping it up to date will help detect and disable malicious software, while using anti-spam software will stop phishing emails from reaching you.
It is also important, particularly for users with a broadband connection, to install a firewall. This will help keep the information on your computer secure while blocking communication from unwanted sources. Make sure you keep up to date and download the latest security patches for your browser. If you don't have any patches installed, visit your browser's website, for example users of Internet Explorer should go to the Microsoft website.
Q-Tips are provided by Coulee Bank's IT Network Risk Manager, Quentin Fisher. He is always on the lookout for ways to keep our customers' information safe, here at the bank, at work and home.