Friday, September 1, 2017

First City Credit Union Celebrates its 80th Anniversary



First City Credit Union is celebrating its 80th Anniversary with a number of celebration events in September, culminating on the credit union’s “birth date” or date of establishment, Sept. 28.  We want to invite you, our members, to the festivities!

We will have open house events that will take place in each of the credit union’s eight branches in downtown Los Angeles, Lakewood, West Covina, Claremont, Palmdale, Lancaster, and Pasadena.  The open houses will take place on each Friday in September with refreshments, member gifts, and special product offers for our members.

Sponsor and member appreciation celebrations will also take place in September.  Food trucks will be deployed at several of First City’s main sponsor groups, providing free lunch to staff while the branches will have refreshments and gifts on random days as appreciation for our members and to thank our sponsor groups for their support.

First City was officially founded on September 28, 1937 as Los Angeles County Employees Number 11 Federal Credit Union, with 65 members and a grand total of $149 in deposits!  Today, with more than 55,000 members, $630 million in assets, and 11% in capital, First City is one of America’s strongest financial institutions.

First City CEO Jim Miller wants you to know that “Through the years, we’ve helped thousands of members fulfilling their financial needs. Our success is a reflection of our relationship with the members, sponsors, and communities that we serve.  Their support places First City among the nation’s most financially sound credit unions; a credit union that has received a ‘5-star superior’ rating by the Bauer Financial independent rating firm for 17 consecutive years.”

Your credit union’s commitment to its sponsor organizations and the communities it serves is highlighted by our involvement, fundraising, or sponsorship of several events, including the Lakewood Fun Run, Department of Public Social Services Funmania, Los Angeles Sheriff’s Fight for Life, Department of Children and Family Services Family Fun Day, Los Angeles Sheriff’s Chili Cook-off, LAC+USC Medical Center’s American Heart Association Heart Walk, Antelope Valley Salute to Youth, Children’s Hospital Los Angeles Holiday from the Heart, Children’s Miracle Network Credit Unions for Kids, and Claremont’s Shoes That Fit.  In addition, First City conducts Financial Literacy programs for the sponsors and communities it serves.

We invite you to take advantage of the special rates we have to celebrate our 80th anniversary with you, our wonderful members!

Wednesday, August 23, 2017

Make the Best of a Financial Setback



Financial setbacks come in all shapes and sizes. It can be an expensive household repair or major car trouble. It may be increases in your insurance plus a rent hike taking effect at the same time. Or, it can be something more extreme, like getting a pay cut at work- or even being given a pink slip. It may be a medical emergency that isn’t covered by insurance, or some good news that will cost you a bundle, like a wedding or the birth of a baby.

It’s impossible to plan for every financial hit you will take in your lifetime.

The question is: What are you going to do about it?

You could ignore it, and keep borrowing or charging to pay for daily expenses when your income is swallowed up by the surprise. By going that route, you’ll be paying a lot more than you should for this setback because of accumulated interest. But you have options–there are proactive steps you can take. So, if you’re hit with hard times, keep these tips in mind:

1.) Don’t panic

Panic is the first reaction many people have when experiencing a financial setback. It won’t be easy, but do your best to keep your cool. Keeping calm will allow you to think more clearly and resolve your deficit quicker. Remember, as difficult as things seem, they’ll always look a little better after some levelheaded planning.

2.) Crunch the numbers

I’ll disappear if you just ignore me and pretend I don’t exist, said no problem – ever. That’s because problems won’t disappear when they’re ignored, especially not money problems. If anything, they snowball into a mountain of financial issues you really don’t want. So, difficult as it might be, sit down and figure out exactly how much more money you’ll need in order to cover your new expense, or to fill the gap of an income loss.

3.) Work twice as hard

When you’re dealing with a financial setback, you’re looking at less money than you need to get you through the month. The only way to stretch what you have to fit your needs is to earn more or to spend less. Since tightening your budget is almost always stressful, try to find ways to add to your income first. If possible, put in more hours at work or seek extra projects, even if it means working nights and/or weekends. Consider freelancing or consulting if you can. Take a side job for some extra cash. Do whatever it takes to bring in a little more money to cover the additional expenses.
If you’ve been laid off or your hours have been cut, it’s OK to work at a job that is below your skill level until you find something more permanent. There’s no shame in earning an honest living.

4.) Trim your spending

Now, it’s time to see which expenses you can trim. Before cutting your budget in half, though, take the time to prioritize. List all the expenses you cannot do without and the ones that would be irresponsible to neglect. Don’t skip mortgage payments or neglect your insurance premiums because you’re short a few hundred dollars. Instead, take an honest look at your remaining expenses and see where you can cut back.

If you’re careful, you may be able to cut your grocery bill in half. Trim spontaneous purchases by only using cash – and keep a minimal amount on you at all times. If you’re a two-car family, consider scaling back to one car for now. Push off your vacation plans until things start looking up. Do whatever you can to come up with the extra cash.

5.) Contact your creditors

If you absolutely cannot make some of your minimum monthly payments anymore, contact your creditors before they come calling on you. It’s always best to be up front about your financial situation. Most creditors will be happy to work out a reasonable payment plan with you.

6.) Reach out to family and friends

The people who care about us most are the ones who can get us through anything. Don’t be embarrassed to tell your family and friends what’s going on. They’ll support you and encourage you until you get back on your feet, and they may even be able to help you out with employment opportunities or helpful contacts.

7.) Be proactive

Hindsight is always 20/20. Harness the urgency you feel now to get into the habit of building up an emergency fund. As soon as you’re back on your feet, start putting away money that can be pulled out in future setbacks. Experts recommend that you have 3-6 months worth of living expenses saved up in case you can’t work for any reason. Knowing you have that money to fall back on will take the stress out of these situations.

Do you need help recovering from a financial crisis? Call, click, or stop by First City Credit Union today, for help with money management and ending the debt cycle.

Tuesday, August 8, 2017

Creative Ways To Save On Energy Costs



We’ve all heard it before: Close the vents in rooms you don’t use, regularly replace your AC filters and vacuum the coils on your fridge. But what if you’re following all the conventional energy-saving tips and your summertime electricity bill is still astronomical?

Here’s where we come in! You know how much we at First City love helping you save money. So we’ve compiled a list of 10 creative ways to lower your electricity bill – even when the humidity is thicker than pancake mix. And don’t worry; You won’t find any mention of refrigerator coils here!

1.) Plant some trees and shrubs
Trees are a whole lot more than oxygen-breathing beauties; they’re also your key to trimming your electricity bill.

Take a good look at your home’s exterior walls. If there are lots of west-facing windows, you’re likely getting loads of sunlight each afternoon that’s heating your home and forcing your AC unit to work harder. By planting trees and shrubs in front of some of these windows, you’ll lower your energy use in a clean – and green – way.

2.) Go solar
Getting your home’s electricity through solar panels is wonderful – and also incredibly expensive. If you’d love to go green on your home’s energy but can’t afford solar, consider leasing the panels instead of buying them. You’ll be given a set monthly fee, which makes budgeting easier, with no surprises during high-energy times of year. Also, according to Jonathan Bass of SolarCity, the monthly payment for leasing solar panels is often 15% less than the local utility rate.

3.) Rethink your roof
Is your roof dressed in black for 90-degree weather? No wonder your home is so warm! Consider installing a sunlight-reflecting “cool roof” or adding an approved coating to your roof that will deflect heat. Both can reduce your roof’s temperature by up to 60 degrees, which can then trim your AC use by as much as 20%.

4.) Keep your cool
Large, heat-generating appliances can warm up a room quickly. Consider running your washing machine and dishwasher at night or in the early morning when it’s cooler outside.

5.) Lighten up
Lighting generally eats up 25% of residential electricity bills. Listen to what your dad always told you and shut the lights in a room when you walk out. Also, consider leaving lights off completely if it’s sunny out and your windows are open. Lastly, switch to CFL or LED bulbs. By swapping out just five heat-generating incandescent light bulbs in a high-traffic area in your home, you can save $65 a year on energy costs.

6.) Fix leaky windows and doors
If your home isn’t a new build, you likely have leaking windows and doors. Caulking regularly shrinks. Structural walls of houses tend to shift with time.

To check if your doors and windows are leaking air, thus making your AC put in extra effort to keep you cool, run the match test. Shut off your AC, and close all doors and windows. Light a match and hold it near the windows and exterior doors of your house. You’ll see an air flow if the flame moves, meaning there are leaks.

And, if you’ve got air leaks, you can easily reseal your windows by weatherstripping the problem areas. Your leaky door may need a door sweep replacement. Just peel off the old one and bring it to a home improvement shop so they can help you find a new one that fits your door.
Sealing leaks is easy, economical and can cut your energy costs by 30%.

7.) Get smart!
We live in the age of the smart … everything! By installing a smart thermostat, your home will be programmed to cool off at exactly the times you need. Best of all, you can control the settings even when you’re away from home. Let your AC cool off people, not empty rooms.

8.) Pull out the plug
Did you know that up to 75% of energy consumption by home electronics happens when they’re turned off? Save money by pulling out the plugs when you’re done with your electronics, both big and small. Think toaster, coffee maker and even entertainment center. Why pay for something you aren’t using?

9.) Fire up the grill
If you can’t take the heat, get out of the kitchen! An oven that’s cranked up to the standard 350° and a flaming stove-top will both make your AC unit work harder. But who wants to stand over a hot stove on a beautiful summer day anyways? Step outside for a cold picnic supper or make good use of your grill for dinner prep. You’ll keep the heat out and enjoy the glorious sunshine at the same time!

10.) Laundry smarts
An incredible 90% of the energy used when doing laundry comes from heating the water. When possible, choose the cold setting on your washing machine to reduce your energy consumption. The next big culprit in electricity use in the laundry process is the dryer. Hanging your clothes to dry will trim your bill significantly. If you must use the dryer, consider sticking some tennis balls in there to make the dryer more efficient and help it finish its job faster.

Friday, July 21, 2017

The Best Deals On Wheels For College Students


You’ve shopped for weeks and you’ve packed for hours. Now, you’re finally ready to load your trunk and pull out of the family driveway toward your next stage in life.

Which set of wheels will accompany you on your rite of passage into the grown-up world?
Yes–you’ve chosen your college, your major, and perhaps your roommate. Now it’s time to choose your car.

There are loads of factors at play when making this decision, though.

First, you’ll need to determine if it makes more sense for you to lease or to purchase a car.
Leasing offers flexibility. It’s the perfect choice for those who aren’t ready to commit to a car for long-term usage. It’s also more practical if you can’t afford to be solely responsible for a car’s maintenance and repairs. Monthly lease payments – even with repair warranties and liability waivers – also tend to be cheaper than payments on a purchased vehicle.

Of course, a lease won’t net you anything of value in the long run. When your lease is up, you’ll be out the thousands of dollars you spent “renting” the car, and have nothing to show for it. Also, if you max out the annual mileage limit, you may end up paying a small fortune in fees.

Purchasing a car, on the other hand, is a commitment that pays off in the long run. If you can afford the down payment, monthly fee, and can foot the bill for any repairs (talk to First City Credit Union about affordable coverage for mechanical breakdowns), it may be the choice for you. Remember, though, that cars depreciate as soon as you take them for their first spin. It’s also hard to predict which vehicle will serve you best a few years down the line.

If you do decide to purchase a vehicle, first determine exactly what you can afford. Don’t take on a monthly payment that’s going to squeeze your budget. Building and maintaining a good credit history is crucial – at every stage in life.

Be sure to do extensive research before signing on a car. As a cash-strapped college student, you need to make the most cost-effective decision possible – but that doesn’t mean buying the cheapest car you can find. Your vehicle should serve its purpose without draining your wallet on fuel costs and repairs.
Carefully screen every car you’re considering for fuel efficiency, safety, warranty inclusion and coverage, and cargo capacity.

To make your search a little easier, we’ve compiled a list of the top six cars for the budget-wise college student. Each one is fuel-efficient, offers excellent cargo capacity, and is well-priced. (Cargo capacity listed is with the rear seats folded.)

1.) 2016 Kia Soul
Starting price: $15,900
Cargo capacity: 24.2/61.3 cubic feet
Fuel economy: 27 mpg combined

2.) 2017 Honda Fit
Starting price: $15,990
Cargo capacity: 16.6/52.7 cubic feet
Fuel economy: Up to 36 mpg combined

3.) 2017 Chevrolet Sonic Hatchback
Starting price: $18,455
Cargo capacity: 19/47.7 cubic feet
Fuel economy: 32 mpg combined

4.) 2016 Mazda 3 Hatchback
Starting price: $18,545
Cargo capacity: 20.2/47.1 cubic feet
Fuel economy: 33 mpg combined

5.) 2016 Hyundai Elantra GT
Starting price: $18,800
Cargo capacity: 23/51 cubic feet
Fuel economy: 27 mpg combined

6.) 2017 Volkswagen Golf Hatchback
Starting price: $19,895
Cargo capacity: 22.8/52.7 cubic feet
Fuel economy: 29 mpg combined

Before heading to the dealer’s shop, it’s best to get pre-approved. This way, you’ll know exactly what you can afford, and you’ll be taken more seriously by the dealer. Be sure to drop by First City for your pre-approval and auto loan! Our credit union offers low rates on pre-owned vehicles, so call 800-944-2200 or apply online at www.firstcitycu.org!

Thursday, June 8, 2017

Plan The Ultimate Family Vacation – Together!


If you’ve ever taken your kids on vacation and had to listen to them complain about your choice of activities and about not having enough money to do everything, try something different this year! Bring the kids into the budgeting process, letting them know how much you have to spend and what the costs of various attractions will be. You might even withdraw the money needed and make actual piles of cash for each day. They’ll quickly understand that choices have to be made, but making them part of the process will improve their attitudes and lead to more summer fun!

Planning the ultimate family vacation is quite a challenge. This is especially true when you’re trying to fit in the best attractions and give your kids the vacation of a lifetime while staying within a budget.

How can you accomplish all that and still keep your kids happy?

The solution is simple, yet brilliant: Let your kids be a part of planning that vacation! This way, they’ll be the making many of the choices, thus eliminating the usual complaints and groans about your chosen attractions. Plus, your job will be that much easier. As an added bonus, your kids will learn invaluable lessons about budgeting and making choices.

Several weeks before your planned vacation, hold a family meeting. Then, let your kids know what your destination is before enlisting their help in planning the itinerary. Make sure they know what your exact budget is and fill them in on all the best attractions in the area.

Tell them they are going to have to make some very hard choices. They need to decide exactly what they want to do with the vacation budget.

Do they want to try out the famously fantastic Thai restaurant near the hotel and then spend a day at the beach? Or, would they rather pick up a budget meal and take in the huge amusement park in the area? Do they want to go horseback riding and skip the ATVing? Or, would they rather give both activities a miss and spend the money on water-skiing? Let them know that each option is going to make a dent in the budget, so they need to choose wisely!

To make it even more tangible for your kids, withdraw cash for the entire amount you plan to spend on your vacation and place it on the table. Then, when a choice is made, physically subtract the amount it would cost you from the stash of cash. This will allow your kids to actually see how much each attraction will “cost” them and force them to make better choices.

When your meeting is through, you will have your itinerary planned and your kids will have gained an invaluable life lesson in budgeting and decision-making.

How do you save on a vacation and still keep your kids happy? Share your best tips with us in the comments!

Tuesday, May 9, 2017

Choosing An Equity Loan In A Rising Rates Environment

Question: I’d like to take out a loan against my home’s equity, but I’ve heard that interest rates are expected to climb soon. What are the differences between a home equity line of credit (HELOC) and a typical home equity loan? How does an environment of rising interest rates impact each choice?


Answer: It’s true that most financial experts are predicting an interest rate hike (or multiple hikes) this year. With rising rates, borrowing against the equity of one’s home will likely become a more popular choice. That’s because people will choose to fund home renovations and other high-priced needs with their equity instead of moving to a new home with a mortgage that has higher interest rates. Refinancing their existing mortgage for a lower payment will no longer be a viable option either, since they probably already have a great rate they won’t want to give up.

With that said, here are some basics you’ll want to know about each kind of loan:

HELOCs


1) How they work


A home equity line of credit is a revolving credit line that allows you to borrow money as needed to a limit, with your home serving as collateral for the loan. Lenders approve applicants for a specific amount of credit by taking a percentage of their home’s appraised value and subtracting the balance owed on the mortgage. They may also consider any outstanding debt you have, your income and your credit history.

If you’re approved for a HELOC, you can spend the funds however you choose. Some plans do have restrictions, though, and may require you to borrow a minimum amount each time, keep a specific amount outstanding or withdraw an initial advance when the line of credit is first established.


a) Pros


HELOCs allow for more freedom than fixed home equity loans. Since you’re opening a line of credit and not borrowing a set amount, you can withdraw money as needed from the HELOC over the course of a set amount of time known as the “draw period.” This is especially beneficial if you’re renovating your home or using the money to start a new business and don’t know exactly how much money you’ll need to fund your venture.

Repayment options on HELOCs vary, but are usually very flexible. When the draw period ends, some lenders will allow you to renew the credit line and continue withdrawing money. Other lenders will require borrowers to pay back the entire loan amount at the end of the draw period. Others allow you to make payments over another time period known as the “repayment period.”

Monthly payments also vary. Some require a monthly payment of both principal and interest, while others only require an interest payment each month with the entire loan amount due at the end of the draw period. This can be beneficial when borrowing for an investment or business, as you may not have the funds for repayment on a monthly basis but anticipate earning enough to pay back the entire loan.


b) Cons


HELOCs have variable interest rates. This means the interest you’re paying on the loan can fluctuate over the life of the loan, sometimes dramatically. This variable is based on a publicly available index, such as the U.S. Treasury Bill rate, and will rise or fall along with this index. Lenders will also add a few percentage points, called margin, of their own.

Obviously, taking out a HELOC in an environment of rising interest rates means your rates are likely to increase over the life of the loan. In addition, HELOCs that only require repayment of principal at the end of the term can also prove to be difficult for some borrowers. If you have trouble managing your monthly budget, you may not be able to pay back the full amount on time. In that case, you will be forced to refinance with another lender, possibly at an unfavorable interest rate.

Home Equity Loans


1) How they work


A home equity loan, also secured by your home’s equity, allows you to borrow a fixed amount that you receive in one lump sum. The amount you will qualify for is calculated based on your home’s loan-to-value ratio, payment term, your income and your credit history. Most home equity loans have a fixed interest rate, a fixed term and a fixed monthly payment.


a) Pros


The primary benefit a fixed home equity loan has over a HELOC is its fixed interest rate. This means the borrower knows exactly how much their monthly payment will be for the entire life of the loan. In an environment of rising rates, this is especially beneficial for the borrower, as their loan will not be subject to the increasing rates of other loans. Also, the interest paid on a home equity loan is often 100% tax deductible (consult your tax advisor for details).

Unlike the repayment policy of HELOCs, every payment on a home equity loan includes both principal and interest. Some loans allow borrowers to pay back larger sums if they choose, but many will charge a penalty for early payments. Regardless of policy, at the end of the loan term, the entire amount is paid up and you can forget about the loan.


b) Cons


Taking out a fixed home equity loan means paying several fees. Receiving all the funds in one shot can also be problematic if you find that you need more than the amount you borrowed. Also, the set amount is due every month, regardless of your financial standing at the time. And, of course, if you default on the loan, you may lose your house.

Carefully weigh the pros and cons of each kind of loan before tapping into your home equity. Shop around for the best rates and terms, and be sure to calculate whether you can really afford the monthly payments of your chosen loan.

Don’t forget to call, click, or stop by First City Credit Union to find out about the loans we have available for you.

Tuesday, April 18, 2017

Regulation D: How Does It Affect Me?



Have you ever wondered about the real differences between your savings and checking accounts? Many people realize there must be more to it than just the fact that one includes checks and the other does not. However, they just don’t know what those differences are. So let’s look at some of the technical differences that define each account type.

Reserve Requirements

Did you ever wonder how much cash your credit union keeps in its vaults? It’s not all the money that members have deposited into their accounts. If that were the case, the credit union could never lend or invest money, and you could never earn any dividends on your deposits. Your credit union would simply function as a gigantic communal piggy bank.

There are laws determined by the Federal Reserve’s Board of Governors, called reserve requirements, which govern how much cash financial institutions (including credit unions and banks) must hold in reserve against the accounts at that institution. The portion of federal regulations that contain these rules is called Regulation D – Reserve Requirements of Depository Institutions.

The percentage of funds that must be kept by institutions is currently 10%. But here’s the catch: Only accounts that are defined as “transaction accounts” are considered when calculating this ratio. Other types of accounts do not have the same requirements. If you think about it, it makes perfect sense.

Transaction accounts, such as checking accounts, are used by account holders on a daily basis for their personal finances. That being the case, there is a great likelihood that the credit union will need to come up with a portion of those funds each day. On the other hand, non-transaction accounts, such as savings accounts and money markets, are intended more for long-term savings, so account holders usually leave the deposited funds in the account to grow over longer periods of time.

This also explains why savings accounts frequently offer higher dividend rates than checking accounts do: because financial institutions can use more of the funds on deposit to make money with savings deposits than they can with checking deposits.

Transaction Vs. Non-Transaction Accounts

What accounts fall into the category of transaction accounts? These include demand deposit accounts, also called checking accounts and NOW (negotiable order of withdrawal) accounts.

What characteristics do transaction accounts share? The depositor is allowed to make an unlimited number of payments and transfers from the account to third parties as well as to other accounts belonging to the depositor. The account holder can perform these transactions in various ways, such as by writing checks and by using a debit card and online payment services, among others.

Which accounts are non-transaction accounts? These include savings accounts and money market accounts. What characteristics do they share? Firstly, financial institutions must reserve the right to require at least seven days of written advance notice before account holders intend to make a withdrawal. This right is rarely if ever exercised, but it is included in the account agreement. Additionally, the account holder is limited to making no more than six “convenient” transfers or withdrawals per month.

These “convenient” transfers include preauthorized automatic transfers, transfers and withdrawals requested by phone, fax or made online, checks written to third parties and debit card transactions. Less convenient transactions, however, are unlimited. This includes any transactions made in person, by mail or at an ATM, and phone withdrawals requesting a check mailed to the account holder.

If a depositor tries to exceed the six-per-month transaction limit, the financial institution is required to refuse transfer privileges or convert the account into a transaction account. When this happens to them, many people are unaware of the laws in Regulation D (and never bothered to read their account agreement) and think their credit union or bank has a strange policy. But the truth is, if you don’t like it, you’re going to have to take it up with the Federal Reserve. Your financial institution is just following regulations.

Of course, there are simple solutions that allow savings account holders to avoid the issue. If you need to make more than six payments or transfers from your savings account, you must be up for a little more inconvenience and may need to complete the transactions in a less high-tech method than usual.