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Pandemic Related Retirement Withdrawals

January 27, 2021

Frustrated man calculating bills and expenses.

Is It Okay To Tap Into My Retirement Funds?

The global health crisis has hit everyone in some way. For many, they experienced tremendous loss of income, some with none at all. While unemployment and added government assistance stimulus checks were helpful to some degree, there are many who are still greatly struggling and weighing all income options, including accessing retirement funds early as a matter of survival.


Tips From Our Friends at Choice Investments

Generally speaking, it is always better to leave your retirement accounts alone and pull funds from non-retirement accounts first. This has to do with many factors including the longevity a retirement account requires to make steady gains and compensate for market losses. Over time, these accounts steadily grow. If money is taken out, the compound rate of return structure changes and there are usually pretty stiff penalty fees and taxes for early withdrawal.


Alternatives To Consider

  • If you have an Individual Retirement Account (IRA) and are under the age of 59-1/2, rather than withdraw from your IRA, you may want to consider a personal loan, or home equity line of credit (HELOC). This allows you to borrow against yourself at a lower rate, rather than assume the 10% penalty, and have to pay taxes on the money withdrawn.

  • If you are over the age of 59-1/2, you could take a monthly withdrawal from your IRA to make the loan payments. This way you are only taking out a portion each month, which can be more cost effective than withdrawing a larger lump sum.

  • If you have a 401k you can always take a loan out against that plan too. Again, this is not ideal, but it is a better alternative than withdrawing a larger lump sum.

  • If you have no other choice, then by all means withdraw from your IRA. Money is needed for survival and nothing is more important than your life and health. Just be aware of what you may lose in income overall during the long term.


Invest Smarter

Whether you’re a new or experienced investor, we’re here to help with our investing options. We are more than happy to discuss your personal situation as everyone’s is unique, especially during this stressful time.

If you have any questions, call 315-735-8571 to discuss your options. If you are ready to get started click below.

Get Started


1IRA's are offered through First Source FCU and are federally insured by NCUA.

2Stocks/Stock Funds, other securities, and advisory services are offered through Cadaret, Grant & Co., Inc., a Registered Investment Advisor and Member FINRA/SIPC. These products may also be offered by a First Source "dual employee" who accepts deposits on behalf of the credit union and also sells non-deposit investment products on behalf of Choice Investments LLC through Cadaret, Grant & Co. Choice Investments LLC, Cadaret, Grant & Co., Inc. and First Source are separate entities. You can check the background of these financial professionals through FINRA’s BrokerCheck. First Source Federal Credit Union is not a registered broker dealer and is not affiliated with Choice Investments LLC.

NOT FEDERALLY INSURED    •    MAY LOSE VALUE    •    NO CREDIT UNION OBLIGATIONS    •    NO CREDIT UNION GUARANTEE 

Funds invested through Choice Investments are not federally insured, may lose value, and are of no way obligations of First Source FCU. Involves investment risk and may involve loss of principal. First Source has no guarantees of securities and annuities products offered through Cadaret, Grant & Co., Inc. Licensed to offer securities in the states of AZ, CT, FL, IA, MA, MD, NC, NY, SC, & VT.

Become a Young Scholars Mentor

January 21, 2021

Young Scholars group shot

Mentors Needed Now More Than Ever!

Are you looking for constructive ways to spend your spare time? Would you like to make a positive impact on a local student’s life? The Young Scholars Liberty Partnerships Program (YSLPP) would like to invite anyone interested in providing academic, social, and cultural enrichment to our young program participants to consider becoming a mentor. The application process is simple:

  1. Fill out the enrollment application form

  2. Complete an authorization background check

  3. Pass a Motor Vehicle Records (MVR) check

  4. All applicants must be at least 21 years old and have a valid NYS driver license

Serving as mentors to the amazing young people in the Young Scholars program is among the most rewarding experiences we participate in. For more information, contact Linda Stewart at 315-792-3237 or lbstewart@utica.edu.


The Young Scholars Program

The Young Scholars Liberty Partnerships Program is a multi-year collaborative project between Utica College and the Utica City School District (UCSD) to motivate diverse and talented students to stay in school, earn a New York State Regents Diploma with Advanced Designation, and pursue post-secondary education.

Each year, Young Scholars serves approximately 350 students from grades 7 through 12. UCSD teachers nominate students in sixth grade who show promise, but who may not achieve their full potential due to social and/or economic factors. The finalists are selected by a volunteer panel of professionals from the area.

Chosen students receive year-round academic support including a summer program prepping them for the following school year, college and career exploration, social and emotional support provided by counselors and staff, community service, and enrichment activities. If the student is fortunate enough, they are also paired with a mentor.

The program has been quite successful, as the impressive results show in the YSLPP brochure. More than one hundred YSLPP students have served as summer interns in the local community, and the program’s partnership with Workforce Development has provided hundreds of its students with summer jobs.



Mentorship

An important part of the Young Scholars program is pairing adult mentors with program participants. Mentors are volunteers who serve as positive role models, give students guidance and advice, and provide fun social and cultural enrichment experiences. Many activities are free, so it doesn’t cost a lot, in money or time. In fact, the minimum commitment is only 2-4 hours a month. Some mentors have one student they provide support to, and many mentor multiple students, often participating in activities with several students together. Many mentors have kids of their own, and bring their mentees along during family events.

While mentoring means a very modest commitment of time, mentors can make a tremendous impact on the lives of these promising young people. Mentors say they get more from the experience than the students do, and often form lasting friendships with their mentees. With a small investment in time, mentors make a big difference in the community.



Becoming a Mentor

Although a number of First Source staff and Members have joined with other community members to serve as mentors, the program can use more. The commitment is just one year, though most stay for more. Once you are qualified, the program provides an orientation, and ongoing support to help you get started and continue to provide fulfilling experiences for your mentee.



Why First Source is Invested in the Program

We are very excited to continue to partner with this tremendous program to help fulfill the dreams of our youth here in the Mohawk Valley, as their goals align with our community mission. We provide financial support, fill leadership roles, offer job shadowing and internships to Young Scholars interested in banking and/or financing, donate tools to teach financial literacy in their summer program, team up with Young Scholars for community service, and encourage our staff and Members to volunteer as mentors. 


How Can Your Place of Work Get Involved?

To teach community members more about the program, Young Scholars offers 30-minute “Lunch & Learn” presentations and workshops for any sized group, organization, or business. Simply contact them to schedule a presentation for your workplace or organization. 

Individuals can learn more by contacting Linda Stewart, Mentor Coordinator, by email at lbstewart@utica.edu, or phone at 315-792-3237. Join us in becoming a mentor, and help our students Grow Big Dreams. 



“The positive and empowering effects of being a mentor are immeasurable and I am both thrilled and proud to be part of the YSLPP mentoring experience.” 
- Kim Van Duren, Mentor
 


“Mentoring is something that has changed my life in the most positive way. I always find that mentoring has truly made me have a more profound understanding of today’s youth. I feel that no matter what, both of my mentees know that they have someone with whom to share a laugh or an important conversation. Mentoring is a never-ending gift, a mentoring situation that after graduation will hopefully turn into a lifelong friendship." 
- Dennis Hahn, Mentor


“We text frequently and do as many fun activities as we can together. She attends family functions with me because she truly is my second daughter. Watching her grow is incredible and I know there's much more that Young Scholars is going to see from Areiana in the future.” 
- Alicia Adamczyk, Mentor 

 

Federal Housing Administration Loans

October 9, 2020

Couple reviewing paperwork while sitting with their laptopAre They Right For You?

If you're looking to purchase a home, but are nervous about your credit score, or debt obligations, an FHA (Federal Housing Administration) loan may be a good choice.


Advantages of an FHA Loan

  • There are minimal credit requirements which can help ease your mind and the mortgage qualifying process. According to the FHA, loans may currently be granted with little or no credit history, and/or less-than-perfect credit.

  • The initial down payment on the home will be less than those of conventional mortgage loans. With other loans, you may be required to put down 5-10% of the purchasing price, but with an FHA loan, you may only have to make a down payment as low as 3.5%.  

  • Qualifying for an FHA loan may still be possible, even with a substantial amount of debt. Most mortgage loans limit a buyer’s monthly home and debt spending to a certain percentage of their income. While FHA loans have the same stipulations, they generally allow home and debt spending up to higher ratios of the buyer’s income, which can be helpful.

  • FHA loan interest rates are fixed and often lower than those of other mortgage loan types. This could help you save a lot over time on your interest payments.

  • Sellers have a higher percentage option for concessions than they normally would, if the buyer is using an FHA loan to purchase the home. Sellers may contribute up to 6% of the closing costs.


Potential Disadvantages of an FHA Loan

  • If you have good to great credit, the low, fixed interest rate of an FHA loan may actually not be as low as you could otherwise get from another mortgage loan option. This could cost you thousands of dollars over the long run.

  • Private mortgage insurance (PMI) is more expensive for those who get FHA loans. The initial low down payment on the home can result in higher-priced insurance payments. There is an upfront mortgage insurance fee along with a monthly premium to be paid over the life of the loan.

  • FHA loans will not allow you to flip a house. They require the property to be inspected and to qualify as FHA-eligible. This standard inspection generally prevents ‘fixer-uppers’ from qualifying, so if you're looking to find a house to flip, the FHA loan would not be an option.

  • The total amount allowed for you to borrow with an FHA loan changes from county-to-county. If you live in a county with a high demand for, but low supply of, homes, your FHA loan may not allow you to buy the home you were hoping for because its price does not land within the parameters of the loan’s allowable amount.


Borrow Smarter

We understand that every situation and every home is unique. Mortgages can be complicated, but we make it easy. We look forward to working with you on your specific need to find the best possible solution. Get started with the application process below.

 

If you have questions about what type of mortgage is right for you, consider scheduling an introductory discovery call with one of our Mortgage Team representatives. Simply click on the button below, select the “Apply for a Loan” service from the menu and choose the “Mortgage Services” option.

 

Article adapted from BALANCE Financial Fitness Program.

Posted in: FHA loan

Making Miracles Happen

September 3, 2020

Supporting Our Local Children's Miracle Network Hospitals

At just 34 weeks into their pregnancy, Grayson's parents were stunned to learn that their unborn child was in serious jeopardy of losing his life. Immediate labor induction would be necessary to save their baby.

Born prematurely at 8 months, Grayson spent the first few weeks of his life in the Level II Special Care Nursery, located on the St. Luke’s Campus. Thanks to the generosity of those in our community, the Children’s Miracle Network Hospitals (CMNH) is able to provide the Special Care Nursery with much needed funding, allowing Grayson and his family to remain close to home during this critical time. 

Today, Grayson is a happy, healthy and vibrant little boy, who loves to play with his dogs, and spend time with his mom and dad. 

Grayson, and children like him, are why we support and raise funds for the Children’s Miracle Network Hospitals. On September 9th, 2020, all First Source employees will be participating in the CMNH Miracle Jeans Day fundraiser. We encourage you to join us in our mission to help make miracles happen for all those facing childhood illness within our community. First Source has already donated $1,000 to this tremendous cause and we urge you make a contribution towards our fundraising goal. Every little bit helps, so please give. 

Donate Today

Tips For First-Time Credit Card Users

August 18, 2020

Responsible young man using a credit card.Credit cards are a powerful financial tool and as the saying goes, “with great power comes great responsibility.” If you are looking to get your first credit card, these tips can help you use it in a smart, financially-sound way. If you abuse your credit card, intentionally or unintentionally, you could find yourself in financial distress.

Credit cards can help build your credit score. Good credit scores can, in turn, allow you to access better loans and mortgage rates, higher limits on future credit cards and more. Credit cards can also damage your credit score if you use them unwisely. Avoid maxing them out, always pay your monthly statement on time and pay more than the minimum if you can. Try to pay in full whenever possible.


1. Consider Becoming An Authorized or Joint User First

Not comfortable with having your own credit card yet? See if a relative will let you become an Authorized or Joint User on their card. If you become one, you will be issued a card with your name on it but the primary cardholder will be held accountable for charges and payments. Some credit card companies may report credit activity for you as the Authorized or Joint User, and if the card is being used wisely by all parties, you could earn good credit yourself.


2. Treat It Like Cash

If you don’t have the money now or won't in the near future to pay off the purchase, you may not want to put it on your card. You'll increase your risk of accruing interest and expanding what you owe. This can put you into debt which can be hard to get out of and hurt your credit score.


3. Pay The Balance In Full Or Close To It Every Month

Make sure you pay off your purchases at the end of every billing cycle. This way, you’ll avoid paying interest, possible late fees and avoid damage to your credit score. Making only the minimum payments will cause the interest to really add up, costing you more money in the long run.


4. Use It To Build Your Credit

When you pay off your balances every month, you establish a positive credit history. You demonstrate to credit agencies and lenders that you can handle the responsibility of credit. This will become important when you want to buy a car, rent an apartment, or buy a home. Your credit score shows how financially responsible you are and is used by those checking to predict your future responsibility. On the flip side, late or consistently missed payments can damage your credit score, making you a higher risk to future lenders.


5. Always Check Your Statements

Unfortunately, credit card fraud is a very real thing. Check your statements every month to make sure there aren’t any unrecognizable charges. If you see a purchase that you didn’t make, report it to the credit card company immediately.


6. Avoid Scams and Fraud: Don’t Share Your Info With Anyone

Credit Cards are private and one way to help you avoid fraud is by never sharing your card information with others. Don’t let others use it, even close friends or family members. Beware of phishing scams where someone calls pretending to be the credit card company and asks you for personal information to “verify who they’re speaking with”, such as the security code on the back or your billing zip code. Your credit card company will already know this information and will not call you asking for it.


7. Look For A Good Rewards Program

A rewards program is designed to give card holders everything from merchandise to miles and even cash back, just for using that card. While cards for first-time users may not have a breadth of rewards available, it can’t hurt to look. Every card’s rewards formula is different, so make sure you understand what your rewards options are before you decide.


Pay Smarter

With a First Source credit card, you get the purchasing power of Visa®, for safe and secure transactions thanks to the EMV chip technology. We offer great options like non-variable rate cards and variable rate cards with reward options.

Learn more about our credit card options and benefits to see if one is right for you. Get started with the application process below.

 

If you have more questions, feel free to give us a call at 315-735-8571 or make an appointment with one of our friendly and knowledgeable representatives today.

 

Article adapted from BALANCE Financial Fitness Program.


Posted in: Credit Card

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