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Money Matters

Farmshares A Great Value for Your Grocery Dollar

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According to the USDA, as of March 2011 families receiving food aid from the government rose 13.5% in California. Many families have members that are out of work and with rising fuel costs, more and more families are having to rely on government aid to put food on the table.

While those statistics are obviously inclusive of many factors, I can’t help but wonder how many of those families are using the aid to its best benefit.

Did you know that buying fresh fruits, vegetables, and meat from local farmers is not only good for you, but can help stretch your food spending plan? Are you considering signing up for government aid and you’re looking for ways to scale back what you spend on groceries every week? Locating a farmshare may be exactly what you’re looking for.

I’ve read estimates that range wildly between $100 a week for a family of four to $400 a week for a family of four for groceries. We all know that the most expensive items are those that are prepackaged and/or frozen. Fresh food is rarely expensive in money, however it’s usually expensive in time, or so we think. The reality is that there are plenty of quick, tasty recipes that are available for free online and from friends and family. Local farmshares can provide fruits, veggies, and meat weekly or monthly, to your home or for pick up. Check around the site to find a farmshare that fits your food tastes and your spending plan.

There really is no down side. You’re family will be spending fewer dollars on food, adding more great-tasting foods to their diets, and maybe even losing a few pounds in the process. If you’re looking to get the most out of your grocery dollar visit LocalHarvest.org and order a farm share.

Shay Olivarria is the most dynamic financial education speaker working today and the author of three books on personal finance. Visit her at www.BiggerThanYourBlock.com.

 

Heard About the New Credit Score?

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There is lots of talk going on about the new VantageScore credit scoring system. Have you heard?

This credit scoring method places more emphasis on your recent history and can also include your rent and utility payments. It’s supposed to help give lenders a better picture of your overall credit worthiness by including bills that you have been paying for years and have not been getting credit for under the FICO scoring method. Experian is the only credit reporting agency to include rental payments so far.

As you know, there are three major credit reporting agencies in the United States; Experian, TransUnion, and Equifax. Each one has a credit file on you, therefore you have three separate FICO scores. The FICO scoring method was created by the Fair Isaacs Corporation as is used widely by companies in the United Stated to asses your credit risk. The FICO scores are computed from a complex algorithm that takes multiple pieces of information into account to create a numerical representation of your credit risk between 300 and 850. The higher the number, the less concern there is that you will repay any loan extended to you. According to www.MyFico.com the five most important pieces of information are: payment history, debt ratio, length of credit history, new credit, and types of credit used. Credit scores go up and down based on your behavior.

The VantageScore scoring method is owned by Experian, TransUnion, and Equifax together, so it’s offered by all three scoring companies, along with the traditional FICO score. Scoring is very similar to the FICO model but with two differences: what you’ve done lately is weighted more than what you’ve done previously and rental payments can be included in your score. This will be a benefit to those with little-to-no traditional credit history: young adults, those that do not use credit cards, and recent immigrants. The range is from 551 to 990 and will be accompanied by a letter grade.

Haven’t we all wondered why someone can’t get a mortgage with a monthly repayment of $900 when they have been paying $1,200 in rent, per month, for the last five years? Well, this new scoring model can take those payments into account. We have to make sure that our voice is heard, especially in areas of credit reporting. Encourage your rental company to start reporting rental payments today.

Visit www.VantageScore.com for more information about the new VantageScore scoring model and don’t forget to ask your rental agency if they are reporting your rental history. It could help you buy a home of your own.

Shay Olivarria is the most dynamic financial education speaker working today and the author of three books on personal finance. Visit her at www.BiggerThanYourBlock.com.

Invest in Yourself

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Troy Polamalu is taking time during the NFL lock-out to earn his college degree. I wish more NFL players, and people in general, were being proactive about their financial futures.

Though Troy makes millions and, according to the U.S. Census Bureau, the average American family brings in $50,221 a year we have a lot more in common that one might think. We all have to feed our families, keep a roof over our heads, and clothes on our backs. We all have to make decisions about how to spend our money and how we can increase our net worth.

Every day we make decisions about how we will spend our money. Most of the time we spend our money investing in things that will not increase the value of ourselves, our families, and our communities. In 2010 African-American buying power was valued at  $836 Billion by the U.S. Census. How much of that money went into purchasing things that increases the net worth of African-American households?

There is an idea that you’ve had for a while now about generating more income. It could be starting a business. It could be furthering your education. It could be cutting unnecessary costs to create, or add to, your emergency account or retirement account.

What’s stopping you from investing in yourself? I bet you invest in soda manufacturers, jeans companies, and utility conglomerates every day. Is giving your money to those organizations to create value for those shareholders more important than creating value for yourself?

I thought not.

You are going to take one step this week to increase your value. You are going to do one thing differently than you would normally do it to increase your net worth. It might be saving your change in a jar because you know that, on average, you’ll save $50 per month. Perhaps you’ll buy a water filter pitcher for your home so you can stop buying bottled water and use the savings to start your emergency account. Find a small opportunity to make a big difference in your financial life.

Whatever you do, you’re going to start investing in yourself today.

Shay Olivarria is the most dynamic financial education speaker working today and the author of three books on personal finance. Visit her at www.BiggerThanYourBlock.com.

Housing Market: How to Make the Best of the Current Economy

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Curtis Flannigan
Assistant Vice President and Branch Manager
Corona Magnolia Branch

The current state of our nation’s economy has been difficult for many homeowners. Mounting foreclosures, plunging home values and swelling adjustable-rate mortgages have left some property owners facing bankruptcy or foreclosure. Conversely, the low interest rates and sharply discounted prices have created a unique advantage for many buyers in today’s housing market.

While buying low may be the natural and appropriate move for some, it may not be the right choice for all. Research each scenario, evaluate the variables and consider your options before purchasing a home.

Assess your situation As appealing as discounted properties can be, jumping into the housing market under the wrong pretenses could end up costing you in the longterm.

Expecting to “flip” the house as an investment property may be risky, given the transaction costs of buying and selling property. In general, if you buy a home, plan on living in the residence for at least a few years.

In addition, if you are not prepared to put forward at least 20 percent towards a down payment or to budget for monthly mortgage and principal payments, then it may not be the right time for you to buy a home. Both factors are vital to the decisionmaking process: the down payment provides an equity cushion in case prices keep declining and budgeting may help you gauge whether you can afford the payments.

Evaluate your finances Get your finances in order early. Make sure you have the job security to follow through on the purchase. Have your down payment ready and compile the information for your income verification. Ensure your credit history is as clean as possible by checking your credit report, confirming the data are accurate and correcting any errors. These steps can help ensure a favorable mortgage rate. Have a clear picture of the type of property you are looking for. Do the research and be ready to take action if you find one that fits. You might even be able to leverage the seller into paying for inspection-related improvements and providing other concessions such as assistance with closing costs.

Consider foreclosures Foreclosures have created home ownership opportunities for some buyers. You may want to review the foreclosures in your market as part of your home search. Buying such a property can be complicated so you may benefit from a professional who has foreclosure experience.

Research special homebuyer programs First-time homebuyers can still take advantage of the government’s tax credit of up to $8,000. The government recently extended this credit until September 30, 2010. There is also a long-time resident credit of up to $6,500 to others who do not qualify as first-time buyers. Please check with the IRS or your tax advisor for the details.

Stay put You may be able to benefit from the current market without purchasing a new home. One option is refinancing your mortgage. Generally, homeowners are encouraged to refinance if there is a difference of one to two percentage points between the current market’s interest rate and the existing one on the mortgage.

Making improvements to your current home is another option. If you have the capital, you may wish to make renovations to increase your home’s value and make the property more attractive to future buyers.

Energy efficient upgrades can save money on utility bills and may be eligible for tax rebates.

While the current housing market can still provide some significant challenges, with thorough planning, accurate assessment and sound decisions, you may be able to benefit from its unique opportunities.

For more information contact:

Corona Magnolia Branch
1431 South Rimpau, Suite 102
Corona, CA 92879
Curtis Flannigan, Branch Manager
(951) 739-5925

Tips on ATM Safety

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By Lawrence Henry, Union Bank, N.A. Senior Vice President and Regional Manager –

For many, visiting an automated teller machine (ATM) is part of a routine, much like grocery shopping and filling up at the gas pump. With new, sophisticated scams to pilfer personal financial information, it is smart to be increasingly vigilant in your efforts to protect yourself and your financial information when visiting an ATM.

Before your next ATM stop, consider these safety tips:

• Be alert. When visiting an ATM, scan the area for anything that looks suspicious, especially someone who may be standing too close. Do not allow strangers to help you with your transaction and do not hesitate to cancel your transaction if you begin to feel uneasy.

• Location, location, location. Consider using an ATM in a well-lit location and preferably inside a bank branch or lobby or closer to the center of a building rather than the corner or back of a building where there may be blind spots.

• Plan ahead. Consider keeping a supply of deposit envelopes on hand so you can prepare your paperwork ahead of time. Have both your deposit paperwork and ATM card in hand when you arrive in front of the ATM.

• Tuck it away. As soon as your money comes out of the ATM, put it away and count it in a location that is safe.

• Know the scams. One of the more common scams used at ATMs is “skimming.” Criminals using this method mount a wireless skimmer device to the front of a legitimate ATM and strategically place a hidden wireless camera where it can capture PINs inserted into the keypad. When a card is swiped, the skimmer reads the card number and transmits it to the criminals. The camera captures the corresponding PIN number as it is inserted. To help combat this crime, consider shielding your PIN with your hand as you enter it. If your card becomes stuck in an ATM machine, alert your financial institution right away. If you notice any changes to equipment on an ATM or anything unusual, contact your banking institution and alert the manager of the institution where the ATM is located.

• Lock up at drive-up ATMs. When visiting a drive-up ATM, consider keeping your engine running, your car doors locked and your windows up until you are ready to make your transaction. Keep valuables out of sight.

• Keep your PIN private. Your PIN number is for your use only and should never be shared with anyone. If you receive a telephone call from someone who says they are working for your banking institution, do not provide your PIN and immediately notify your bank and the authorities. It is also important to review your bank statements regularly to scan for any suspicious charges.

The foregoing article is intended to provide general information about ATM safety and is not considered financial advice from Union Bank. Please consult your financial advisor.

Lawrence Henry is a senior vice president and regional manager for Union Bank, N.A., a full-service commercial bank providing an array of financial services to individuals, small businesses, middle-market companies, and major corporations. The bank has 340 banking offices in California, Oregon, Washington and Texas and two international offices.

UnionBanCal Corporation is a wholly- owned subsidiary of The Bank of Tokyo-Mitsubishi UFJ, Ltd., which is a subsidiary of Mitsubishi UFJ Financial Group, Inc. Union Bank is a proud member of the Mitsubishi UFJ Financial Group (MUFG, NY SE:MTU), one of the world’s largest financial organizations. Visit www.unionbank.com for more information.

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