On the Horizon: Better Online Banking, Mobile App Features
If you haven’t heard the good news, your trusted financial home had a good financial year — despite dealing with the results of inflation — which will allow us to invest in providing you with enhanced financial services while keeping member costs (such as fees) low.
As noted in our recently published 2022 annual report, Mid American’s year-end assets increased from $369 million in 2021 to $410 million in 2022, an increase of more than 11%. We had a small increase in membership from more than 43,000 to more than 44,200.
As part of our investment into services, we are working on upgrades to our online banking site and mobile app, expected to roll out by this year’s fall quarter. As part of enhancing your digital banking experience and opportunities to interact with us online, the upgrades will give you the tools you need to take better control of your financial wellness. Several of those tools revolve around concepts we stress in our financial literacy seminars, such as budgeting and goal setting, which are important in managing your finances.
Here are two other tools that you will find useful once the upgrades are completed:
• A robust credit score section. Through this feature, you will be able to find your credit score and get insight into what factors impact your score. If you are contemplating a major purchase or loan, you will be able to run a simulation before you act on that decision to see how your credit score will be impacted.
• A dashboard look at all your financial accounts, even those not held at Mid American. Through the account aggregation feature, you will be able to link in your accounts at other financial institutions so you can get a comprehensive look at your overall financial situation.
Another investment underway are improvements to the south Wichita branch, which became wholly owned and operated by Mid American in fall 2022 after being run in partnership with other credit unions over the years. Under our ownership, new ITM stations are being added, the parking lot is being improved, and a new exterior sign will be installed with full-color video panels.
Thank you for allowing Mid American to be your trusted financial home; and with that trust, we will continue to look at ways to enhance the services we provide you.
When to Get Life Insurance
By Emily Reinhardt, blogger for Mid American’s www.moneymatters.coop
Getting life insurance can be an important step in protecting your family’s financial well-being and their future after you die. Generally, you should get a life insurance policy when other people are depending on your income or if you have a significant amount of debt that will carry on after your death.
The time to get life insurance varies depending on an individual’s personal and financial circumstances, but the older you are the more expensive it will be to purchase a policy. Here are some factors you should consider:
Dependents. If you have dependents, such as children or a spouse who relies on your income, getting life insurance should be a priority. In the event of your death, the payout of your life insurance can help provide financial support to your dependents to cover expenses such as housing, education, and day-to-day living costs.
Debts. Even when you don’t have dependents, life insurance might be necessary if you have outstanding debts such as a mortgage, car loan or credit card debt. Many lenders require payment of outstanding debts from your estate even in the event of death. You don’t want to leave that type of burden to the person handling your affairs after your death.
Age and health. The younger and healthier you are, the lower your life insurance premiums will be. Waiting until you are older or have health issues can result in higher premiums or even a denial of coverage.
Income. If you are the primary breadwinner in your family and your income is essential to maintaining your family’s lifestyle, a life insurance policy can help ensure that your family is financially secure in the event of your death.
Future plans. If you plan to start a family or purchase a home, getting life insurance can provide peace of mind that your loved ones will be financially protected if you pass away. If you have children, a policy can help ensure they can achieve an education to help with their financial future.
Term life or permanent life insurance. A term life insurance policy provides coverage for an agreed-upon length of time. The start date of the term can depend on when you think others might start depending on your income and you’ll want it to last as long as you anticipate them relying on you. If you’re a parent, that is usually until your children are grown. Couples who own property together might consider a policy for the length of the mortgage, but if both incomes are relied upon for the mortgage, then both people would need to consider a policy. With a permanent life insurance policy, also sometimes called a whole life policy, the cash value grows tax-deferred over time and it does not expire. Most permanent life insurance has a death benefit combined with a savings component, and these policies have more favorable tax considerations but have much higher monthly premiums than term life insurance policies.
As with all other serious financial decisions, it’s best to consult with a licensed insurance agent to discuss your options and determine what type of coverage is best for your situation
How to Avoid Online Romance Scams
What do we mean by romance scams? We’re not talking about the person you thought was “the one” but ended up being a dud. We’re talking about people you meet online, who lavish you with attention … and then ask for money. Usually they want the money by wire transfer or gift card. They might claim they need it for a medical emergency or to come visit you. Then they take your money, but there’s no surgery and no trip.
Romance scammers are hard at work wooing people on dating apps and social media. They may lift photos to create an attractive profile or even steal the identity of a real person. Just like with real romances, it may take them some time to gain your trust, but the scammer’s payoff can be big. Last year, people reported a median loss of $2,600 from romance scams. Never send money or gifts to a sweetheart you haven’t met in person.
Take it slowly. Ask questions and look for inconsistent answers. Check the person’s photo using your search engine’s “search by image” feature. If the same picture shows up with a different name, that’s a red flag.
Talk to someone about this new love interest. And pay attention if your friends or family are concerned.
If you suspect a romance scam, cut off contact right away. Then, report to the scam to the FTC at ftc.gov/complaint. Notify the dating site where you met the scammer, too.
IRA Creates Better Tax Breaks for Home Energy Improvements
By Debbie Stang, Home Loan Officer
Many homeowners have been interested in making energy-saving improvements to reduce their utility bills but now there’s another financial incentive: tax breaks to reduce one’s tax bill.
The Inflation Reduction Act (IRA) of 2022 expanded and extended two tax credits to encourage homeowners to invest in energy-efficient improvements or in clean energy systems for their homes.
While the bigger tax credits are for converting to or installing cleaner energy systems, like solar panels, solar water heaters, geothermal heat pumps or other systems, homeowners can also qualify for a tax break by installing more energy-efficient windows and doors. (You can even get a tax break under the IRA if you’re installing an energy-charging station for your electric vehicle.)
The IRA eliminated the previous $500 lifetime cap on the energy-efficient improvement credit. Now, homeowners can claim this tax credit annually with qualifying energy-efficient improvements from 2023 until the end of 2032.
Depending on the type of improvements being made, a homeowner may qualify for up to $3,200 in tax credits. Qualified purchases include central air conditioners, furnaces, water heaters, insulation, exterior doors, windows and skylights.
To save even more money, check if rebates are available for your purchases, according to the Energy Star website, which also includes a rebate finder by zip code. The link for that tool is energystar.gov/rebate-finder.
According to a late 2022 news release from Congress, the IRA also created grants that states can use to establish rebate programs, but those grants are not yet available.
A fact sheet about the IRA tax credits can be found on the Internal Revenue Service website at irs.gov/credits-and-deductions.
If you are interested in taking advantage of these tax credits and making your home more energy efficient, Mid American offers two home equity lending options: a loan or a line of credit. In both instances, the lending limit is determined by the difference between your home’s value and your remaining mortgage balance. For more information, please call 316-722-3921 and ask for either me or LeeAnn Marker in mortgages, or email firstname.lastname@example.org or email@example.com.
With these tips, you can do that.
• One word: staycation. By visiting your own city or taking day trips, you can save on hotel and dining costs. To find things to do, visit your city’s visitors bureau website or city website or check out your state’s travel website. Visit livingontheheap.com and check out its local affiliate websites for freebies and deals (i.e. Wichita on the Cheap or Kansas City on the Cheap).
• Go outdoors. Plan a trip to a state park, where you can camp or rent cabins and take advantage of outdoor activities. If you don’t have camping gear, see if you can borrow items from friends or family. To save money, check off-season cabin rental rates.
• Use membership perks. Warehouse stores like Sam’s Club and Costco offer travel deals to members. If you’re an AAA member, use its vacation-planning benefit and discount rates on rental cars and hotel stays.
• Travel in the off-season. To avoid crowds and higher prices on flights and accommodations, check the off-peak travel times to your selected destination.
If you haven’t already, set up a vacation savings account with Mid American and arrange regular deposits. You can withdraw funds from the account at any time and up to three times monthly.
50 and Older? Here’s Your Chance to Catch Up on Retirement Saving
If you are age 50 or older and still working, you have a valuable opportunity to super-charge your retirement savings while managing your income tax liability. Catch-up contributions offer the chance to invest amounts over and above the standard annual limits in IRAs and workplace retirement plans.
In 2023, the IRA catch-up limit is an additional $1,000 over the standard annual amount of $6,500. Participants in 401(k), 403(b), and government 457(b) plans can contribute an extra $7,500 over the standard limit of $22,500. For SIMPLE plans, the catch-up amount is $3,500 over the standard limit of $15,500.1
Contributions to traditional workplace plans are made on a pre-tax basis, which reduces the amount of income subject to current taxes. Contributions to traditional IRAs may be deductible, depending on certain circumstances.
If you are not covered by a retirement plan at work, your traditional IRA contributions are fully tax deductible. If you are covered by a workplace plan, you may deduct the full amount if your adjusted gross income is $73,000 or less as a single taxpayer, or $116,000 or less if you’re married and file jointly. If you are not covered by a workplace plan but your spouse is, you are eligible for a full deduction if you file jointly and your income is $218,000 or less.2
Contributions to Roth accounts do not offer immediate tax benefits but qualified distributions are tax-free at the federal, and possibly state, level. A qualified distribution is one made after the account has been held for five years and the account owner reaches age 59½, dies or becomes disabled. Distributions from traditional accounts prior to age 59½ and nonqualified distributions from Roth accounts are subject to ordinary income taxes and a 10% penalty, unless an exception applies.
Limited Time for 2022 Contribution
If you qualify, you can make a deductible IRA contribution for 2022 up until the tax filing deadline on April 18, 2023. The total contribution limit for someone age 50 or older in 2022 is $7,000. You can open a new IRA or invest in a current one but be sure to specify the contribution is for the 2022 tax year. The income limits for a full deduction in 2022 are $68,000 for single taxpayers, $109,000 for married taxpayers filing jointly, and $204,000 for taxpayers who aren’t covered by a workplace plan but their spouse is.2
1) Participants in 403(b) and 457(b) plans may benefit from other catch-up contributions specific to each plan type. Participants in government 457(b) plans cannot combine age 50 catch-up contributions with other catch-up contributions. When calculating allowable annual amounts, contributions to all plans except 457(b)s must be aggregated.
2) Phaseout limits apply. Married couples filing separately cannot take a full deduction. You must have earned income at least equal to your IRA contribution. Talk to a tax professional.
*Non-deposit investment products and services are offered through CUSO Financial Services, LP (“CFS”) a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment representatives are registered through CFS. The Credit Union has contracted with CFS for investment services. Atria Wealth Solutions, Inc. (“Atria”) is a modern wealth management solutions holding company. Atria is not a registered broker-dealer and/or Registered Investment Advisor and does not provide investment advice. Investment advice is only provided through Atria’s subsidiaries. CUSO Financial Services, LP is a subsidiary of Atria.