Freeze Your Credit For FREE!

Everyday we place our personal information in the hands of companies and trust that they will keep our personal information protected.  We swipe our credit cards and debit cards at retailers, we provide identifying information to establish online accounts with social marketing applications and in placing online purchases.  Our healthcare providers, utilities and communications providers all require personal information to establish accounts.  Bank On encourages citizens to protect their identity, but what happens when the companies we do business with don't protect our information?

Over the last few years we have heard reports of many companies being hacked.  Here is just a short list of a few that might have touched your life:

• Anthem
• AOL
• Apple
• AT&T
• Cox Communications
• CVS
• Dropbox
• Ebay
• Equifax
• JP Morgan Chase
• Michaels
• Target
• TD Ameritrade
• Uber
• US Department of Veterans Affairs
• Virginia Department of Health
• Yahoo

These hacks make us more and more vulnerable to identity theft.  

If you want to have greater protection for your identity, here is some good news: on May 24, 2018, President Trump signed the Economic Growth, Regulatory Relief and Consumer Protection Act into law.  This law enables you to request a free credit freeze for anyone requesting one after September 21, 2018.  

Credit freezes protect identity thieves from opening up an account in your name.  Credit freezes prevent a credit reporting bureau from releasing your credit information to a third party, so new accounts cannot be opened without you taking a positive action to release the freeze.  Currently, state laws govern the establishment of a credit freeze and it can cost up to $10 for each credit reporting bureau to.  This new law makes freezing and unfreezing your credit free.  

To learn more about these new protection visit www.ftc.gov and search for "credit freeze".  Protecting your good name will soon be free!

Tax Refund Uses to Jump Start Your Financial Plans

Do you spend weeks eagerly anticipating your tax refund? When the money finally comes in, is it gone tomorrow? Many people view tax refunds as unplanned bonuses, using for splurges or treats. A tax refund provides the opportunity to improve your financial situation. Use these tips to get the most value from your refund check.

• Pursue financial goals. Saving for a house or car down payment?  Apply your tax refund toward these goals. With Bank On Hampton Roads, you can establish SMART goals to speed your progress. Bank On has monthly classes to help you with your financial makeover. 10-Month class series begins January, April or September. Learn more at www.bankonhr.org

• Pay down your debt. Use your refund for some much needed debt relief. Pay down credit card balances. Your refund paired with a debt snowball can knock years off your indebtedness. To get started on a debt snowball, you can visit www.powerpay.org.

• Save for a rainy day. Put your refund into a savings account or emergency fund to prepare for big expenses. Savings helps you with a major car repair bill, medical emergency or other unexpected expenses. Virginia Saves offers a variety of savings and debt reduction strategies. Join today at www.virginiasaves.org

• Build retirement. Tax time is a great time to establish or increase your retirement funds. Starting early and letting your investment grow can provide you a secure future in your older years. Find out how much you need to save each month, check out the Ballpark Estimate at www.choosetosave.org/ballpark

• Enjoy. Apply your refund to pay for your vacation, back to school or holiday expenses to take the stress out of those irregular expenses that can throw your budget off course. We all have things we enjoy. Use Virginia Saves’ 30-40-30 plan to earmark a portion for pleasure while still saving and reducing debt. Learn more at www.virginiasaves.org.

• Upgrade your life. Your refund check provides the opportunity to improve your life. Spruce up your home (replace the siding, stain the deck, etc.). Repair or replace your car to increase your transportation reliability. Improve your career opportunities by taking a class or training course.

• Train your children. Use your refund to teach your older children to handle money. Allow them to manage a portion of the refund, teaching them to budget for school, clothing and entertainment expenses as well as the importance of savings. Our children depend on our instruction to prepare them for life’s choices. Begin now.

• Leave a legacy. Use your refund to offer hope and encouragement to others by making a charitable contribution to a non-profit. Investing in the lives of others can offer them a helping hand at a crucial moment in their lives and can also provide you a charitable deduction to reduce your taxes next year. 

Are You Taxed?

Earning income is a great thing, but the more you earn under our tax regulations, the more you owe.  
Often, life events can throw us into a new tax situation without us really realizing it.  Things like marriage, divorce, children becoming young adults, retirement, pay increases and more can impact our tax circumstances and we may find ourselves unprepared for the tax bill we get. 

If you find yourself owing the IRS, here are some ideas to help you overcome this year's tax liability and prepare for next year so that you don't have to repeat the process.  Most of the actions that need to be taken are things you can do right now.  

1. Paying your tax bill.  If at all possible, you should pay what you owe in full and on time.  It may be a big hit, but it is better to adjust your spending over the next couple of months and pay the IRS than to incur penalties and fees associated with non payment or late payment (up to 5% per month).

If you are unable to come up with the funds to pay your taxes out of your monthly budget, consider borrowing from other sources before doing a payment plan with the IRS.   IRS monthly interest can be higher than traditional sources.

If you have no other option for payment, the IRS offers payment plans.  IRS has both short term payment plans (less than 120 days) and long term payment plans.  These plans allow you to repay your tax debt over time and avoid incurring additional penalties for non filing or non payment.  There is an interest charge for these repayment plans, but it is much easier than the non payment penalties.  

2.  Adjusting Withholdings:  If you owed an amount that was hard to bear, you may want to consider adjusting your withholding on your W-4.  This is the form that tells your employer how many deductions you anticipate for your taxes.  If you reduce the number of deductions, your tax payment will go up each payday and your paycheck will go down.  But paying each payday is easier than having a big hit at the end of the year.  

The IRS encourages employees to use the Withholding Calculator to perform a quick “paycheck checkup.” An employee checking their withholding can help protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time in 2019. It can also prevent employees from having too much tax withheld; with the average refund topping $2,800, some taxpayers might prefer to have less tax withheld up front and receive more in their paychecks.  If changes to withholding should be made, the Withholding Calculator gives employees the information they need to fill out a new Form W-4, Employee’s Withholding Allowance Certificate. Employees will submit the completed W-4 to their employer.

3.  Increase Retirement Participation:  One of the easiest ways you can reduce your tax bill and prepare for your future at the same time is to increase the amount you contribute to your employer retirement plan.  This money is not included in taxable income on your W-2 at the end of the year so it can save you some money on next year's taxes.  

Detonate Your Debt