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May 2019 E-Newsletter

5 Money-Saving Tips for Family Vacations


No one has ever said that a family trip to Orlando, Florida, is a bargain. So when my husband and I decided to take the kids and meet his brother and sister-in-law there over Thanksgiving weekend, we knew we had to be strategic to get the most value from our vacation. Here are the rules we applied to our vacation planning to help us stretch our budget.
Woman Gardening and on laptop
1. Consider non-traditional solutions
We have two senior dogs, and it can be a challenge for us to find someone to care for them when we travel. Because they are 12 and 14 years old, boarding them or having them stay in a dog sitter’s home is not an option. We’ve paid as much as $60 a day to have someone stay in our house with our dogs. Because Orlando is a just few hours drive each way from where we live in South Florida, my husband floated the idea of bringing the dogs with us. At first, I was reluctant because it sounded like a hassle. But once we did the math, it was actually cheaper for us to stay in a dog-friendly hotel and bring our pups than to pay for doggy care. We saved about $180 on pet care.

2. Use your credit card perks
Every credit card comes with different features, which is why my husband and I own several each. I carry the Marriott Bonvoy Boundless™ Credit Card because even though it has an annual fee of $95, it also comes with a free one-night hotel stay at a property valued up to 35,000 points. While that may not be enough for a night in Manhattan or Paris, Orlando is teeming with hotels at all different price points. The room was a mini-suite with a kitchen, two queen beds and a seating area with a pull-out couch. The hotel also had a free shuttle several times a day to and from the Disney resorts that took about seven minutes each way.

3. 'Free' can be more expensive
When you’re budgeting for a trip, expenses like meals out, parking fees and day passes to explore the parks can add up. For example, if the Universal Orlando Resort had been our main attraction, I might have preferred to stay on-site at one of its properties. Several of those hotels give guests free Universal Unlimited Express Passes, which allow them to wait in shorter, faster lines at the park.

4. Create wiggle room
After checking your budget, you may see some more opportunities to boost your savings. For example: There were two more cost-saving benefits to our hotel. First, breakfast, which included eggs, make-your-own-waffles, oatmeal, cereal, fruit, yogurts and juices, was free. All those items at an on-property hotel restaurant would have cost close to $100 for our family every day. And, unlike the on-site hotels, parking was free too. These savings gave us a little wiggle room in the budget to do something extra. We took our boys to Medieval Times to enjoy some rivalry and revelry Middle Ages-style. Adult tickets were $64.95 each, and kids 12 and under were $36.95. Our total for the excursion was $203 — just about the same as a night at the hotel. If we hadn’t gotten the one free night at the hotel through my credit card, we may not have had room in the budget.

4. Have a plan
After checking your budget, you may see some more opportunities to boost your savings. For example: There are a million ways to take a family trip. The last time we went to Orlando, our only plan was to see Universal Studios for two days. For that trip, we just had to plan lodging and park tickets. This time, we knew we wanted to do more. Once we knew we wanted to stay at a hotel under the Marriott umbrella to use the free night and that we were going to bring our dogs, it helped narrow our search for an appropriate hotel. It was a definite bonus that breakfast and parking were free, and there was a complimentary shuttle to get to and from the park. Because we took the time to research and compare our options, we were able to create a plan that saved us money and allowed us to add an extra adventure.

The article 5-Money Saving Tips For Family Vacations originally appeared on Nerdwallet.com

How to Refinance Your Mortgage

You made Image of Woman using Computerit through one of the toughest challenges: buying a home. Now, perhaps just a few years later, you’re ready to refinance your mortgage. How hard can it be? You may be surprised to find that it’s not a couple-of-emails-and-a-phone-call-or-two process. In fact, there may be more paperwork involved this time around than when you first bought your home. Let’s consider some important initial steps of a mortgage refinance — and then run through the rest of the process step by step.

Why you might want to refinance
Before you begin, it’s important to consider why you want to refinance your home loan in the first place. That guides the mortgage refinance process from the very beginning. Lowering your payment is usually the goal. And it’s tempting to refinance with another full 30-year term to really knock down that monthly payment. But that means you’ll end up taking even longer to pay off your house and paying more interest.

"Choosing a suitable loan term for your mortgage refinance is a balancing act between an affordable monthly payment and reducing your borrowing costs"


You’ll want to take into account how much interest you’ve already paid on your old loan and how much you’ll pay with the refinance. Loans are front-loaded with interest, so the longer you’ve been paying, the more each payment is going toward paying off the principal balance — and the more interest you’ve already paid. Comparing what you’ve paid in interest so far and what you will pay on your current loan versus the refi will give you a solid idea of your total loan costs for either option. By resisting the urge to extend your loan term, you can instead refinance to reduce the term and to get a lower interest rate, which could significantly reduce the amount of interest you pay over the life of the loan. Choosing a suitable loan term for your mortgage refinance is a balancing act between an affordable monthly payment and reducing your borrowing costs.

It’s also key to shop the best refinance rates
Now it’s time for a little legwork — or more likely web work and phone calls. You want to shop for your best mortgage refinance rate and get a loan estimate from each lender. Each potential lender is required to issue the estimate within three days of receiving your basic information. The estimate is a pretty simple three-page document that details the loan terms, projected payments, estimated closing costs and other fees. Compare the loan details from each lender and decide which one is best for you. This is a good time to really work Coulee's mortgage refinance calculator.

Refinancing your home loan, step by step
Ready to tackle the whole refinance process? Go!
  1. Determine your goal. We’ve covered this: Refinance for the right reason. Aim to shorten — or at least maintain — your current loan term while lowering your interest rate.
  2. Learn your current credit score. Check your credit history and get your credit score. The better your score, the better the mortgage refinance interest rates you’ll be offered.
  3. Research your home’s current value. Check your neighborhood for recent sales of homes like yours.
  4. Shop for your best mortgage rate. You can shop rates online all you want, but limit the window for submitting loan applications, or allowing your credit report to be pulled, to a two-week period to lessen the impact on your credit score.
  5. Know your all-in costs. Refresh your memory about what mortgage closing costs are, and compare closing costs listed on the Loan Estimate form you receive from each lender you consider. A home loan refinance can trigger a bunch of fees: application fees, the cost of an appraisal, origination fees, a document processing fee, an underwriting fee, a credit report charge, title research and insurance, recording fees, tax transfer fees and points, to name several. And don’t jump blindly for a “no-cost refinance” pitch. This means the lender is moving the upfront fees to your ongoing costs for the loan, in the form of a higher interest rate — or a greater loan balance.
  6. Gather paperwork. This can be a bit harder these days because so many of us do our financial business online. But you might have to gather, print or download statements, pay stubs, and whatever else the lender will need during the loan process.
  7. Lock your rate. You’ll have to decide when to lock in your mortgage refinance rate with the lender, so the rate you’re offered for your new loan can’t change during a specified period prior to closing. For the logically minded, it’s a hand-wringer — more art than science.
  8. Have cash on hand. There are likely to be property taxes and insurance, closing costs and other expenses to pay at closing, so be sure to set aside enough to cover them. Again, it’s listed in your loan estimate, so there should be no surprises. In some cases, these costs can be added to the mortgage balance, which, on the one hand, limits your upfront costs but, on the other, increases what you owe on your home.
Final tips
Keep in mind that some homeowners refinance their mortgages for reasons other than snagging a lower interest rate. Some refinance as a way to get rid of mortgage insurance. Others are interested in tapping their home equity as cash, but it’s important to understand the pros and cons of a cash-out refinance.

And for any refinance, be sure to consider how long it will take for you to break even on the fees and expenses. But refinancing — for the right reason, with a good rate and a suitable term — can enhance your financial position.

If you have any questions, our Mortgage Lenders are easy to talk to and will walk you through the process, step by step. 

The article How to Refinance Your Mortgage originally appeared on Nerdwallet.

Coulee Bank's Q-Tip: Make and Remember Strong Passwords

Photo of phone charging station Whenever you leave your home I’m sure you make sure that you secure the building – after all, you wouldn’t want to come home and find an intruder, or discover that your prized possessions have disappeared, would you?

Likewise, I’m sure you wouldn’t want anyone gaining access to your computer, or any of the information you keep on the internet. That’s why you need passwords. And lots of them.

In many ways your passwords, in conjunction with your username, are the key to your digital life and, just like you wouldn’t use a key with no cuts on it, you wouldn’t want to rely on weak login credentials to keep you safe either. Given the fact that usernames are used across a range of sites (it’s typically an email address, after all), your passwords better be good if they are to stop an attacker gaining access to all your accounts.

You’ll note at this point that I’ve said passwords – you will definitely need more than one because, if you don’t, you’ll be putting all your eggs into one basket – if that single password gets hacked, or revealed by the ever-increasing number of data breaches we keep hearing about, then all of your online accounts are immediately compromised at the same time.

Just think about that for a minute – how would you feel if someone could access your email, Facebook, bank, sign you up for inappropriate sites and post on your Twitter account? While suffering one of the above would be bad, having every account compromised at the same time would be truly tragic.

Password manager
That’s why I recommend a password manager. By using a highly rated program, such as LastPass, KeePass or 1Password, you can rely on the software to remember all of your complex passwords for you while only having to remember the master password for the program itself. For more options check out our list of the best password managers.
If you’re still not sure have a read of our guide to the pros and cons of using a password manager.

Given that the main excuse many people give for not using strong, unique passwords is their inability to remember them all, a password manager really is a useful tool.

Creating a strong password
Once you are setup with a password manager, you will be well placed to start creating unique and strong login credentials for every online account under your control.

To do so, here are 5 tips:
  1. Make use of your entire keyboard – too many passwords are overly reliant on lower-case letters which makes them weak and easily cracked. Instead, mix in numbers, symbols (!”£$%^&*) and capitals. 
  2. Change your password on a regular basis – with a password manager in place this won’t be too much of a chore and, unless you keep up with data breach news, will add some degree of extra security should your login credentials be compromised via an incident with a third party. 
  3. As previously mentioned, always, always, use a different password for every account – doing otherwise is just asking for trouble. 
  4. Make your password as long as possible – the shorter it is, the easier it will be cracked by automated password-guessing tools. Aim for an absolute minimum of 8 characters and a whole lot more if possible, especially when using a password manager which will negate the need to remember even the most complex of passwords. 
  5. If you are not entirely comfortable using a password manager, try stringing several memorable words together – but change letters for numbers where possible, i.e. ‘e’ becomes ‘3’, ‘a’ becomes ‘4’, and throw in some punctuation and other symbols for a degree of extra complexity.
Of course there are also some pitfalls to avoid when choosing a password:
  1. Do NOT use personal information as a password – you may think no-one else knows your mother’s maiden name, or your firstborn’s date of birth, but you’d be wrong – the internet and electoral role never forget a thing. 
  2. Do NOT make a password that consists solely of simple words, such as “cat” or “London” – attackers can use something called a dictionary attack to break passwords like that in milliseconds. 
  3. Never use any password that appears on a list of those most commonly used, such as the timeless classics of “123456” or “password1” because, surprise, surprise, they are often the first ones an attacker will attempt to use when trying to compromise your account.
  4. Never, ever share your password with anyone – if you’ve gone to the trouble of creating a strong password why would you want to undo all that good work by then giving it away? Also, remember, doing so at work may be a serious offence, and quite rightly too.
  5. Never send your password in an email – no company of note would ever ask you to do so. Also, never give your password out over the phone – some companies may ask you to confirm one or two characters for verification purposes, but never the whole thing.
  6. Don’t make your password identical to your username – this happens far too often and hackers are well aware of that. 
  7. Never write your passwords down and definitely do not put them on a post-it note stuck to your monitor – that’s just asking for trouble.
  8. Also, beware secret questions – some sites offer the ability to retrieve a lost or forgotten password by entering the answer to a pre-chosen question. If you aren’t careful here you may inadvertently make the appropriate answer easier to guess than the password itself.
One more piece of advice – if a site offers two factor authentication (the means to confirm your identity via an additional control method, such as your mobile phone), seriously consider taking advantage of it as it will almost certainly offer a strong, additional layer of security.

The 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.

Business Corner: SBA Loans: What You Need to Know

Of all types of small business funding, Small Business Administration 7(a) loans are one of the best ways to finance your enterprise. They’re guaranteed by the federal agency, which allows lenders to offer them with flexible terms and low interest rates. Getting one can help you grow your business without taking on possibly crippling debt. SBA loans, as the 7(a) loans are also known, are the agency’s most popular type of financing.

There’s one big downside, however: It can be tough to get a loan from the SBA.

Still, low annual percentage rates make the SBA program one of the smartest ways to fund your company. With some know-how and preparation, you may be able to secure some of the lowest business financing available. 
Image of Woman using Computer
What is an SBA loan?
SBA loans are small-business loans guaranteed by the SBA and issued by participating lenders, mostly banks. The SBA can guarantee up to 85% of loans of $150,000 or less and 75% of loans of more than $150,000. The average 7(a) loan amount was about $425,500 in 2018, according to the agency’s lending statistics. The program’s maximum loan amount is $5 million.

If you’re looking to open a new location, hire employees or refinance an existing loan, SBA loans are a great option. SBA loan rates and terms typically are more manageable for borrowers than other types of financing.

What is an SBA loan guarantee?
Lenders provide the funds that make up an SBA loan, but the agency guarantees a portion of the amount, up to a $3.75 million guarantee. That means if you default on the loan, the SBA pays out the guaranteed amount. This guarantee lets lenders offer longer terms for repayment than they otherwise could, which means your monthly payments will be lower.

Do SBA loans require a personal guarantee?
The SBA requires a personal guarantee from every owner with at least a 20% ownership stake and from others who hold top management positions. A personal guarantee puts you and your personal assets on the hook for payments if your business can’t make them.

How do I get an SBA loan? The best place to start is the SBA website, which includes a loan application checklist. Use this to gather your documents, including your tax returns and business records. Here are some of the documents you’ll need before applying:

• SBA’s borrower information form
• Statement of personal history
• Personal financial statement
• Personal income tax returns (previous three years)
• Business tax returns (previous three years)
• Business certificate or license
• Business lease
• Loan application history

Then ask your SBA district office for the names of a few approved lenders. The agency also recently set up the SBA Lender Match tool to match potential borrowers with lenders. Banks follow SBA guidelines but use their own underwriting criteria to evaluate loan applications.

The SBA has another financing program called SBA Express, which aims to respond to loan applications within 36 hours. If your credit and small-business finances are in excellent shape, the wait may be shorter. The maximum amount for this type of financing is $350,000, and the maximum amount the SBA could guarantee is 50%.

How do I pick the right bank? If you’re applying through a traditional bank, it helps to work with one that has a track record of processing SBA loans. Coulee Bank is an SBA Preferred Lender!

In general, a bank with multiple years of experience in processing SBA loans will be able to give you guidance, including letting you know your chances of being approved. “If you choose the right bank,” she says, “the lending staff will facilitate that process and make it as easy as possible.”

This article, SBA Loans: What You Need to Know, originally appeared on Nerdwallet

Coulee Investment Center: Balancing Act: Income, Expenses, and Withdrawals

In projecting what you’ll need to save in order to generate enough retirement income, it helps to (1) prepare a realistic household budget and (2) understand what types of expenses you’ll have once you stop earning a regular paycheck.

Types of Expenses
  • Fixed Expenses – “Must Haves”
  • Mortgage or rent Taxes (income and property)
  • Car payments, gas and maintenance (if applicable)
  • Health insurance
  • Food
  • Utilities
  • Discretionary Expenses – “Nice to Haves”
  • Eating out
  • Entertainment
  • Travel
  • Sports and hobbies
  • Gifts
  • Shopping
Sensible savers will plan to cover all must-have expenses before they consider splurging on nice-to-have items. You’ll also need to factor inflation into your expense projections: certain sectors of the economy, such as health care, have seen prices rise much higher than everything else.

How much should you take out of your savings?1
Retirement brings with it many unknowns, including how much you can spend each month from the so-called “three-legged stool” of Social Security, retirement plan and personal savings. Withdrawal amounts depend on how much you’ve saved and the expected return on your current investment mix and age, among other factors.

Much research has focused on what percentage of account value retirees can take each year so that the money won’t run out — assuming various rates of inflation. Some analysts suggest that 3.0% to 4.0% is a sustainable withdrawal-rate range in the early years of your retirement. A 4% withdrawal rate is considered sustainable except in cases where inflation creeps above 5%. But withdrawal rates of 5% or higher are risky, especially when inflation approaches 4%.2 Depending on the size and health of your nest egg and the growth rate of your expenses, you may be able to adjust this rate in future years.

Order of withdrawals can make a difference
Deciding which of the “three legs of the stool” to spend first depends to a great extent on tax laws. Most people know that delaying taking Social Security payments until age 70 can mean higher payments later; they may not realize that a portion of Social Security income is taxable at ordinary tax rates, which currently is set at a maximum 37%.

Remember that tax issues and IRS rules on qualified plan distributions can be very complicated. For example, although your money can grow tax-deferred inside a 401(k) or pension account, once you take a withdrawal, the entire distribution is hit with your ordinary-income tax rate and possible penalties if you’re under age 59½. On the other hand, selling stocks you hold in a taxable account means that only your capital gains will be taxed at the current maximum of 20% (depending on your income). Some think it’s best to take money first from regular taxable investment accounts and let tax-deferred accounts continue to grow.

Not everyone agrees with this strategy, though. Depending on your circumstances, some think it makes sense to withdraw money from your IRA and 401(k) before spending down your taxable assets. “The idea is to let the assets that will be taxed at the lowest rate accumulate for the longest time,” says Robert Carlson, author of The New Rules of Retirement: Strategies for a Secure Future. For example, if you think income tax rates will be higher in the future, you may want to spend down your taxable assets sooner. Consider enlisting the assistance of online tools or retaining a financial planner to tailor the order of withdrawals to your specific needs and tax situation.

1 Withdrawals from qualified plans prior to age 59½ may be subject to a 10% IRS penalty. Account values are subject to income tax upon distribution. This discussion is not intended to show the performance of any fund for any period of time or fluctuations in principal value or investment return. Periodic investment plans do not ensure a profit nor protect against loss in declining markets. 2 Gerstein Fisher, “What’s a Sustainable Withdrawal Rate for a Retirement Portfolio?” Seekingalpha.com, May 1, 2018. https://seekingalpha.com/article/4168085-sustainable-withdrawal-rate-retirement-portfolio

This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal or investment advice. LPL Financial and its advisors are providing educational services only and are not able to provide participants with investment advice specific to their particular needs. If you are seeking investment advice specific to your needs, such advice services must be obtained on your own, separate from this educational material.

Kmotion, Inc., 412 Beavercreek Road, Suite 611, Oregon City, OR 97045; www.kmotion.com

© 2019 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance; nor as the sole authority on any regulation, law or ruling as it applies to a specific plan or situation. Plan sponsors should consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.