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June 2015 E-newsletter

Tips for First-Time Homebuyers in a Seller's Market

While interest rates are still near record lows, supply is tight and properties are moving fast, making it a seller's market. In fact, it's not uncommon for a Wisconsin seller to receive three or four offers the day their house is listed. So, if you're looking to take advantage of great rates and buy your first home, make sure you prepare with today's real estate market in mind. Here are a few tips to get you started on your journey to homeownership:

Know your budget.

The first - and most crucial - step in home buying is to determine how much you're able to spend. That includes knowing how much of your savings you're willing to apply to the down payment and how much you can afford each month for your mortgage payment. In general, housing costs (including property taxes, utilities, maintenance and homeowners insurance) should not be more than 28 percent of your pretax income. If you can afford it, negotiate for a larger down payment or a shorter loan term to reduce overall interest costs.

Get preapproved.

To improve your changes at getting a lower interest rate on your mortgage and have the flexibility to move quickly once you find a house you want to buy, ask your bank to pre-approve you first. A free service at most banks, loan pre-approval will boost your credibility with real estate agents and sellers because it shows you're able to get financing and are serious about buying. It will also make the process of applying for your mortgage faster, especially if you obtain the loan from the same bank that pre-approved you for credit.

Shop around for your mortgage.

Just like you shop around for the perfect house, make sure you shop around for the perfect mortgage. Don't only compare the interest rates, however. Look at loan origination fees, administrative fees, title insurance, settlement charges and any other costs added to the price of the house. It's also helpful to have an established relationship with the bank you're getting the mortgage from. They'll have a better understanding of your financial goals and be able to recommend the best mortgage product for your circumstances.

Find a great real estate agent.

Once you've selected the bank you'll be getting your mortgage from, ask your mortgage banker for recommendations for a buyer's agent. They work with agents on a daily basis and will have a good idea of who will work well with you and meet your needs as a client. The process of buying a house can be complex, so working with a real estate agent that you trust is essential for a smooth first-time buying experience.

Source: Wisconsin Bankers Association

Kasasa Money Truck / Grand Old Day

Grand Old Day is the largest one-day festival in the Midwest, drawing over 250,000 people each year from the greater Twin Cities metropolitan area, regionally, and from neighboring states. The event is held along Grand Avenue, Saint Paul’s premier shopping, dining, and entertainment district (and where Coulee Bank is located of course)!

This year, our team will be walking in the parade with the Kasasa Money Truck / Rewards Rush. What is that you ask? Well, you know those crazy, old-school cash grabs? We’re putting two of those in a truck and filling the booths full of Kasasa bucks. You jump inside to grab the rewards and trade them for cool prizes that you’ll actually use.

We’ll have the truck parked outside our St. Paul branch after the parade so you can have a chance to jump inside and feel the rush of rewards banking. For more information on the Grand Old Day Parade, visit

9 Ways Recent Grads Waste Money

This year 2.8 million students will complete college and another 1 million will finish graduate school. That means nearly 4 million people are, or will soon be, newly on their own and in many cases managing their finances for the first time ever.

After the excitement of graduation wears off, having to pay bills, fund a 401(k), and tackle student loan debt can be daunting. Add everyday spending blunders and soon the paycheck you were so excited to finally claim can feel pathetically small.

If you want lights, you need to pay your bills. If you want a future, you need to save for your retirement. And if you want to keep debt collectors at bay, you need to make student loan payments. When it comes to your money, knowledge is power. Understanding ways that new grads tend to go wrong is key to making sure you come out ahead.

Not Knowing what you Can Afford in Rent

Housing is typically a person’s largest expense – recent grad or not – but many young people have no clue how much they can responsibly spend. This often leads to spending way too much, which reduces the amount you have to spend on everything else and makes it hard to stick to a budget.

Many financial planners advocate a guideline called the 50-30-20 rule. This says that 50% of your take home pay should go to needs, 30% to wants and 20% to savings. No more than 60% of your needs budget (or 30% of your take home pay) should go toward housing. This may sound impossible to someone making a relatively small salary in a big city, but the closer you can stay to this guideline the better it will be on your finances.

Not Saving

If you are offered a 401(k) plan for retirement through work, use it and contribute at least enough to get your employer’s match. About half of employers that provide 401(k)s also match some percentage of the money you put in. Not taking advantage of a match is like turning down a raise.

Mindless Buying

How many times have you walked into a store for just one thing, and left with a receipt for $100? Spending that happens without us realizing it is not adding any value. Go to the store with a shopping list and commit to no deviations. For the things you do need, see if you can lower the bill with rewards cards, store apps, or coupons.

Ignoring Fees

There is no expense sillier than paying to access your own money. Don’t put yourself in the position of having to pay ATM or minimum balance fees. At Coulee Bank, we offer free Kasasa Checking and Savings accounts - with no monthly fees or minimum balance requirements - that not only pay you rewards, but also refund up to $20 per month is ATM fees. Learn more.

Paying for Things you Don’t Use

Do you pay for cable even though you mostly binge on Netflix or use your parents’ login to watch HBO Go? Is ad-free Spotify really worth $9.99 per month? Are you paying for the priciest membership at your gym when you could sweat just as well with a cheaper one? Make value judgments about what services are worth paying for on a monthly basis. Cut the subscriptions you don’t use and scale back anything that you can get just as much value out of at a lower price. Most importantly, know what is being deducted from your account every month so you can manage cash flow.

Being Cheap

When money feels tight the urge to go with the least expensive option can be strong, but it doesn’t always make sense. Sometimes cheap furniture breaks and you spend more money replacing it than you would have if you had gone for the nicer item. Do some research before you make purchases and, if needed, spend a little bit more on quality to save in the long run.

Deferring Loans

After graduation, you typically have a six-month “grace period” before you are required to make student loan payments. Use this time to get your finances in order: Start an emergency savings fund, contribute to your 401(k), and get accustomed to living on your new income. Avoid spending more than you will have left when your loan payments come due so the new outflows aren’t a shock to your budget.

If you are going to graduate school you’ll have the option to defer loans. If you are working through grad school consider making payments anyway, especially if you have unsubsidized loans because they continue to accrue interest. If you have the means, not making payments just delays the inevitable and is wasting future money.

If you are making payments on a loan – deferred or not – and can pay more than you owe, do it. This will cut down the principle of the loan and ultimately reduce the amount of interest you owe.

Falling for Deals

Deal sites like Groupon, Gilt, or LivingSocial are great for saving on things you would buy anyway. Have plans to get dinner with a friend? Using a Gilt coupon for the cute Italian place you’ve wanted to try is wise. But the fact that they are offering a great deal on headphones (that you don’t need) does not justify the purchase.

Being Lazy

After a long day at work it is easy to convince yourself that you don’t have the time or energy to cook. So you order carry out or delivery for the restaurant down the street. About an hour and some $20 later, your food arrives. Throwing together a simple salad, pasta, or omelet would have been cheaper, faster, and healthier.

Set rules for yourself. Maybe you can only order takeout if you got stuck at work past a certain hour. Maybe you commit to eating home cooked food at least three nights a week. The same logic applies for many other tasks like hiring someone to clean your apartment or going to a salon to get your nails polished instead of painting them yourself. Some of these conveniences will be worth the money, but if you are on a tight budget you’ll need to decide which matter most to you.


Security Q-Tip: Spoofing Travel E-mail in Your Inbox

With Memorial Day behind us, the busy summer travel season has officially started. Coulee Bank Security would like to offer a brief reminder that the travel season brings with it an area of opportunity for scammers. An old but effective trick that has been used for years is airline, hotel, and resort rip-off e-mails. Users should be on high alert for travel e-mails coming to their work or personal email accounts. Here are a few tips to aid in making educated decisions about travel marketing e-mails.

  1. If you weren’t expecting the e-mail, it’s probably a scam.
  2. Never use the links in e-mails: If possible search the company from a search engine and look for “the promotion” on the website itself.
  3. Call the company: If the offer seems too good to be true it most likely is. Calling the company can help to confirm this. 
  4. Search the company and use the contact information from their website, rather than relying on a phone number in an e-mail.
  5. Remember, sending e-mail addresses can be spoofed in the title section. Always use the expanded view to check to see the actual sending information.

Since the summer season can be a busy time for spam e-mail, now is also the time to do a quick refresher on secure e-mail practices.
Safe Travels!
Coulee Bank Security

6 Smart Budget Moves to Make Before Summer Begins

If you want to enjoy a carefree summer, make sure you have your finances in order so that money stressors don't rule your days. Whether you want to jet away on a summer vacation or just plan on enjoying a few weeks of rest and relaxation at home, prepare for a fun summer ahead by taking steps to improve your financial situation right now.

Here are six smart budget moves to make before summer begins.

1. Create a Summer Travel Budget
If you're planning on doing any traveling this summer, put together a realistic budget to cover the cost of those road trips, weekend getaways, or flight and hotel packages to your destination of choice. Start researching deals and determine what type of budget range you are comfortable with for each visit. Consider being flexible with your travel dates so you can secure a great mid-week deal or last-minute package to offset some of the costs.

2. Cut out Extra Expenses
Trimming down expenses even by $50 a week can save you $200 a month leading up to those long summer days. Take a close look at your grocery budget and everyday expenses such as coffee trips, parking fees, and other miscellaneous costs that add to your weekly expenses. Cut back on extra trips, or plan on carpooling to save money on gas. Cook more of your meals at home to save on food costs. Making a conscious effort to save a little here and there can help you build up that savings account sooner than you think. Use a budgeting app for a few weeks to get into the habit of tracking your daily expenditures while you're on the go.

3. Organize your Accounts
If you have more than one bank account or different types of accounts that may or may not be collecting interest, consider consolidating your accounts to make it easier to manage your money. Take inventory of your accounts to determine whether you are paying unnecessary fees or accumulating charges because you aren't maintaining a certain balance. Those extra costs can add up, so it may be time to shift things around and just maintain a single account. Kasasa Checking and Savings accounts at Coulee Bank are free, have no minimum balance requirements or monthly service fees, pay you rewards, and refund ATM fees each month. Learn more.

4. Prepare a List of Budget-Friendly Activities
Now is a great time to brainstorm some fun ideas and activities for summer. Being spontaneous is always fun, but it can also be a costly venture when you consider that many hotels and resorts book up quickly for the summer and command higher rates during peak season. Plan ahead by making a list of budget-friendly destinations, free activities in the area, and low-cost events that you might be interested in attending this summer. Creating this list now can help you pick up a fun activity even at the last minute, without worrying too much about cost. Turn to your chamber of commerce, local parks and recreation department, area museums, and local travel blogs for some interesting ideas in the months ahead.

5. Boost your Income
If you're having a hard time saving money, seek out some simple ways to give your income a boost. You could pick up a part-time job for a few months, sell some items online, or talk to your current employer about getting a raise. Be realistic about how much you can earn over the next few months or how much you could cash in on by selling certain items. Make sure the money you save from these sources goes directly into a savings account specifically for summer funds.

6. Start Operating on a Cash-Only Basis
If saving money doesn't come naturally to you and you don't think you can reach your summer savings goal, start operating on a cash-only basis to get a better handle on spending. Withdraw a certain amount for personal expenses each week, and pay your bills directly from a checking or savings account. Getting into the habit of working only with the cash you have on hand can put you back in control of your finances and make it that much easier to set savings goals.


Business Corner: The Seven Deadly Sins of Financial Management

Managing the books while continuing to gather new insights and drive business growth is a challenge for every company. However, while these struggles may be ubiquitous, the remedies are often overlooked, resulting in messy financials and a host of other issues.

Is your business guilty of committing one or more of the seven accounting sins? Learn about each one, and how to remedy them, to ensure that your financial processes are scalable and manageable every year.

1. Scattered Business Data
You want to close the books faster, but can’t manage and integrate the influx of data. Five years ago, 70% of companies were able to close out their monthly books in six days. Now, only 50% close in that period. Move to a cloud-based financial management system that integrates with your other operational business systems so you have the right, up-to-the-minute data.

2. Departmental Silos
The finance department can’t collaborate with other departments to speed up and streamline financial processes. Employees spend nearly 28% of every workweek answering emails. Adding enterprise social technologies can improve productivity by 20-25%. Choose a financial system offering enterprise social collaboration so you can cut down on email and increase productivity.

3. Spreadsheet Gluttony
Spreadsheets are time consuming and full of reporting errors. 89% of companies are using spreadsheets for planning, budgeting, and forecasting. 88% of spreadsheets have errors. Step away from spreadsheets and migrate to a system that automates your daily finance processes. This will streamline your workflow and eliminate errors.

4. Slothful Expense Tracking
Services companies experience revenue leakage because they don’t have the proper tools. 69% of mid-to-large sized businesses think cloud-based expense management software can reduce expenses by 20% or more. Automate the process by entering time and expenses in the cloud and linking those entries to client projects to improve billing accuracy and minimize revenue leakage.

5. Stale Financial Data
Manually gathering historical data not only takes time to organize, it also has a short shelf life. More than 50% of the CFO’s time is spent doing accounting rather than making strategic decisions. Move to a system that allows you to make forward thinking decisions based on real-time financial data so you’re both fast and accurate.

6. Lack of Compliance
Revenue accounting involves overly complex, always developing regulations and stiff penalties for non-compliance. The most frequent explanations that companies gave for financial restatements a few years ago was revenue recognition. Businesses should deploy cloud solutions that streamline, centralize, and automate the revenue management process in order to minimize compliance risk.

7. Antiquated Technology
Holding on to old systems doesn't allow you to drive business decisions and forces you to waste time on manual workarounds and IT maintenance. 52% of U.S. senior finance executives said the biggest barrier to improving the effectiveness of finance was outdated IT systems. Accelerate business by using a system that will grow with your company and provide the economic, IT maintenance and innovation advantages of cloud computing.


Coulee Investment Center: Lofty Goals, Limited Means: Finding Ways to Boost Your Investments

Shari-with-title-png.pngIf you're ready to start investing or ramp up your current investment initiatives but there just doesn't seem to be enough money left over at the end of the month, don't give up. The following strategies could help you manage your money better and free up resources for your investment goals.

  • Start Budgeting: While most of us know what a budget is, how many of us actually use one? A budget can help you chart your cash flow by recording all of your sources of income and your fixed and variable monthly expenses. Once you determine where your money is going using a budget, you can prioritize your needs and potentially identify expenses that could be eliminated.
  • Cut Down on Credit Card Expenses: Avoid using credit cards whenever possible, but if you can't, at least work to pay off your debt. Consider transferring your balances to a card with a lower-interest rate, and try to pay at least twice the minimum monthly payment.
  • Watch Transportation Costs: Do you really need a brand new car right now? You could save thousands by purchasing one that's just a year or two old and yet still has a warranty. If you purchase a car -- new or used -- carefully consider whether to finance or lease it. The decision could dramatically affect your monthly expenses.
  • Put your Extra Cash to Work: Did this year's tax refund, raise, or bonus burn a hole in your pocket? The next one doesn't have to. Make plans now to invest it.
  • Cut Down on "Luxury" Spending: If you only go snowboarding or skiing twice a year, it might make more sense to rent equipment instead of buying the latest model and watching it collect dust the rest of the year. Renting movies instead of paying $8 or more to see the latest release and bringing lunch to work are other ways you can watch your bottom line without cramping your own style.

It may be difficult at first, but once you start you'll see that a little bit of discipline can make a big difference when it comes to finding the money to pursue your financial objectives.

Because of the possibility of human or mechanical error by Wealth Management Systems Inc. or its sources, neither Wealth Management Systems Inc. nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall Wealth Management Systems Inc. be liable for any indirect, special or consequential damages in connection with subscriber's or others' use of the content.

© 2015 Wealth Management Systems Inc. All rights reserved.

Securities offered through LPL Financial, member FINRA/SIPC. Insurance products offered through LPL Financial or its licensed affiliates. Coulee Bank and Coulee Investment Center are not registered broker/dealers and are not affiliated with LPL Financial.

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