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Saving for Real Estate Taxes and Insurance Without an Escrow Account

Melanie Tarrant on October 15, 2024

Many homeowners rely on escrow accounts to manage real estate tax and homeowners insurance payments. These accounts allow mortgage servicers to collect a portion of your taxes and insurance along with your monthly mortgage payment, ensuring those big bills are handled on time. However, not all members choose this option—either because they’ve paid off their mortgage, or they’ve received an escrow waiver. If you’re in this situation, here’s how to manage these payments on your own and make the most of your money in the process.

What Is an Escrow Account?

An escrow account is typically required by mortgage lenders to ensure real estate taxes and homeowners insurance are paid on time. Each month, part of your mortgage payment goes into this account, and your lender pays those bills on your behalf when they’re due. It’s a convenient way to break large, annual bills into smaller, more manageable amounts.

Benefits and Drawbacks of Escrow Accounts

Benefits:

  • Convenience: With an escrow account, your servicer handles the payments for you. This reduces the number of bills you have to track and ensures you don’t miss a due date.
  • Budgeting Help: Breaking large bills into smaller monthly amounts can make it easier to budget and avoid hefty lump sum payments at the end of the year.

Drawbacks:

  • No Interest: Most escrow accounts don’t pay interest on the funds sitting there waiting to be used. This means you miss out on potential earnings that your money could generate in a savings account.
  • Less Control: Since the lender controls the funds and when payments are made, you have less flexibility with how and when your money is used.

How to Save Without an Escrow Account

If you’ve opted out of escrow, you’ll be responsible for paying your real estate taxes and insurance on your own. Here’s a disciplined approach to make sure you have the money when you need it:

  1. Open a Dedicated Savings Account: Set up a separate, interest-bearing savings account specifically for real estate taxes and insurance. This way, your money is working for you while it sits, waiting to be used. Click here to see our current interest rates on Hight Yield Checking, CDs, and Money Market Accounts.
  2. Calculate Your Annual Payments: Estimate your total yearly payments for real estate taxes and homeowners insurance. You can typically get this information from your local tax authority or insurance provider.
  3. Set Up Automatic Transfers: Divide your total yearly payment by 12, and set up monthly automatic transfers into your dedicated account. This makes saving easier and ensures you’re consistently putting money away.
  4. Monitor Your Balance: Regularly check your savings account with AGCU Mobile and Online Banking to make sure you’re on track. If there are any changes to your tax or insurance rates, adjust your savings plan accordingly.
  5. Maximize Interest: Choose an account with a higher interest rate so your savings can grow. While it might not generate huge returns, every little bit helps when preparing for large expenses. Click here to see rates!
  6. Lower Your Insurance Payment: If you haven’t compared rates in a while, contact AGCU Insurance to see if you can lower your homeowner’s insurance costs.

Discipline Is Key

One of the main challenges of managing these payments without an escrow account is the discipline required to save consistently. If you’re not careful, it can be easy to fall behind on saving and face a large, unexpected bill at the end of the year. A separate savings account with automatic transfers can help avoid this issue.

If you don’t have an escrow account, we highly recommend opening an interest-bearing savings account today. Not only will this help you prepare for your annual real estate tax and insurance bills, but it also allows you to earn interest in the meantime. Talk to one of our Member Services Representatives today about setting up an account that works for you.

Disclaimer: This article is for informational purposes only. Please consult a lawyer or accountant for professional advice on managing real estate taxes and insurance.

5 Best Times to Buy a Car: Your Guide to Scoring the Best Deals

Melanie Tarrant on September 3, 2024

When it comes to buying a car, timing is everything. Whether you’re eyeing a brand-new model or looking for a reliable used vehicle, knowing the best times to make your purchase can save you a significant amount of money. Here’s a guide to help you navigate the car-buying process and identify the optimal times to buy.

1. The Best Days of the Week: Midweek Wins

Most people do their car shopping on weekends, which means dealerships are busier and less likely to offer significant discounts. To get the best deal and personalized service, consider visiting the dealership on a weekday, preferably midweek. Tuesdays and Wednesdays are particularly good days to shop because the dealership is typically quieter, and salespeople may be more willing to negotiate to make a sale.

2. The Best Time of Day: Late Afternoon and Evening

If you’re looking to strike a deal, consider heading to the dealership later in the day. Salespeople may be more eager to close a deal before they head home, especially if it’s been a slow day. This can work in your favor, as they might be more willing to offer you a better price just to finalize the sale.

3. The Best Months: September, October, and December

Timing your car purchase to the right month can lead to significant savings:

  • September and October: These months are when dealerships start receiving new models for the upcoming year. To make room for the new inventory, they’re often eager to sell off the current year’s models at a discount. This is an excellent time to find deals on cars that are still brand new but may not have the latest features.
  • December: December is arguably the best month to buy a car. Dealerships are trying to hit their year-end sales quotas, and salespeople are often more motivated to offer better deals to meet these targets. The closer you get to the end of the month, the better the deals tend to be.

4. The Best Time of the Month: Month-End

Car dealerships often have monthly sales targets they need to meet. As the month draws to a close, salespeople may be more motivated to make deals in order to hit their quotas. The last few days of any month are an excellent time to visit the dealership if you’re looking to negotiate a lower price or secure better financing terms.

5. The Best Time for Used Cars: Early in the New Year

If you’re in the market for a used car, consider shopping in January or February. After the holiday season, many people trade in their old cars for new ones, leaving dealerships with a surplus of used vehicles. Dealers will be eager to move this inventory, and you may find great deals as a result.

Worst Times to Buy a Car: Avoiding Common Pitfalls

While there are plenty of great times to buy a car, there are also some times you should avoid:

  • Weekends: With the dealership crowded with potential buyers, it’s harder to get a good deal.
  • Early in the Year: While holiday sales events in January can offer discounts, they are often not as substantial as those later in the year.
  • Summer: Unless you’re looking to buy a car model that’s nearing the end of its cycle, summer months generally offer fewer discounts.

Choose Your Best Time to Buy a Car

When you’ve identified the right time to buy, AGCU can help you make and finance your purchase. Our 100% financing options and competitive rates on new and used cars make it easier to drive off in your dream vehicle. Be sure to check out our auto loan rates and apply online for a preapproval before you head to the dealership.

Next Steps:

  1. Assess your flexibility and plan your car purchase around one of the best times of the year.
  2. Research makes and models, and familiarize yourself with fair-market prices to identify a great deal.
  3. Visit your local dealership prepared to negotiate, and consider getting preapproved for an auto loan with AGCU to streamline your purchase process.

By timing your car purchase wisely, you can ensure you’re getting the best deal possible.

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20 Back-to-School Hacks So You Can Beat Inflation

Melanie Tarrant on August 2, 2024

Back-to-School Hacks to Beat Inflation

Back-to-school season is here, and this year, the second-biggest shopping season of the year will be more expensive than ever. With inflation still at all-time highs, the supplies and gear you always buy may cost a lot more than you paid just a year or two ago. No worries, though. There are still ways to trim your back-to-school spending and keep your budget intact. Here are 10 back-to-school hacks for beating inflation.

1. Set a Budget and Stick to It

Create a realistic budget for your back-to-school shopping and stick to it. Make a list of essential items and allocate a specific amount for each category, such as clothing, supplies, and electronics. Make sure your budget is generous enough to cover all purchases but tight enough to not end in debt. This will help you avoid impulse purchases and stay within your financial limits.

2. Start Early and Plan Ahead

One of the best ways to save money is to start shopping early. This will enable you to take advantage of sales and avoid the last-minute rush when prices may be higher. For example, you can pick up pencils when they’re on sale at Walmart one week and paper from Target when it is marked down there. Spreading your purchases over time will also make it easier on the budget.

3. Take Inventory of What You Already Have

Before heading to the stores, check out the inventory of supplies and clothes you already have at home. Often, last year’s items can be reused or repurposed. Check closets, drawers, storage bins, and last year’s backpacks for notebooks, pens, pencils, and other supplies. This can help you avoid buying more of what you already have and save a significant amount of money.

4. Shop During Tax-Free Holidays

Many states also offer tax-free holidays, where certain items are exempt from sales tax. Plan your shopping around these dates to maximize your savings. Combine sales with coupons or loyalty programs for even better deals.

5. Buy in Bulk

For items you’ll need to buy many of, like notebooks, pens, and paper, buying them in bulk can be more cost-effective than traditional shopping. You can generally find discounts on bulk purchases at warehouse stores and office supply retailers. To save even more, you can team up with other parents and split the costs.

6. Use Price Comparison Tools

Harness the power of technology to find the best deals as you shop for school supplies, gear, and clothing this season. A price-comparison website or app, like Honey or RetailMeNot, will automatically compare prices across different retailers to find you the best deal. Many will also find promo codes and coupons for you so steeper discounts can be had.

7. Consider Secondhand Options

Thrift stores, consignment shops, and online marketplaces, like eBay and Facebook Marketplace, can be treasure troves for gently used clothing, backpacks, and other school supplies. Check out these places for high-quality items at a fraction of the cost of new ones. For textbooks, check out websites, like Chegg or ThriftBooks, for used or rental options.

8. Choose Quality Over Quantity

While it might be tempting to buy the cheapest option available, investing in high-quality items can be the least costly choice in the long run. Durable backpacks, sturdy shoes, and long-lasting electronics might have higher upfront costs, but they will likely outlive their less-expensive counterparts and save you money over time.

9. Take Advantage of Student Discounts

Many retailers offer student discounts on a variety of items, from clothing to electronics. Check out the sites of your favorite retailers to see what they offer before completing a purchase. Don’t shy away from asking about possible student discounts in real-life stores, either. You may need to provide a student ID or use a promo code to access these discounts, but you can walk away with significant savings.

10. Leverage Cashback and Rewards Programs

You may want to use credit cards that offer cashback or rewards on purchases to get a little extra back for your spending. Only do this if you know you can pay off the credit card bill in full soon after. Otherwise, the interest charges you’ll be paying going forward will likely offset any benefits you may enjoy.

11. Utilize Cashback and Rewards Programs

Many credit cards offer cashback or rewards points for purchases. Use these programs to your advantage by paying for back-to-school items with a card that provides rewards. Just be sure to pay off the balance in full to avoid interest charges.

12. Take Advantage of Buy-One-Get-One-Free (BOGO) Deals

Keep an eye out for BOGO deals on school supplies and clothing. These offers can significantly reduce your overall spending, especially if you have multiple children to shop for.

13. Use Student Loan Programs for Technology Purchases

If your child needs a new laptop or tablet for school, look into student loan programs that offer low-interest rates or deferred payment plans for technology purchases.

14. Participate in Store Loyalty Programs

Many retailers offer loyalty programs that provide exclusive discounts, points on purchases, and special promotions. Sign up for these programs to maximize your savings.

15. Swap and Share with Other Parents

Organize a swap meet with other parents to trade gently used school supplies, clothing, and gear. This can be a fun way to get what you need while saving money and reducing waste.

16. DIY When Possible

Consider making some of your school supplies at home. For example, you can create customized notebooks, binders, and pencil cases with inexpensive materials. This not only saves money but also adds a personal touch to your child’s items.

17. Seek Out Coupons and Rebates

Before making any purchases, search for coupons and rebates. Websites like Coupons.com, RetailMeNot, and manufacturer websites often have printable coupons and rebate offers that can save you money.

18. Utilize School Supply Drives and Donations

Check with local community organizations, schools, and churches for school supply drives. Many organizations offer free supplies to families in need. Take advantage of these resources to reduce your back-to-school expenses.

19. Use Cashback Websites

When shopping online, use cashback websites like Rakuten or Swagbucks. These platforms give you a percentage of your purchase back as cash or rewards points, which can add up over time.

20. Plan for Next Year

Start planning for next year’s back-to-school shopping as soon as this season ends. Take advantage of end-of-season sales and clearance events to stock up on supplies and clothing at deeply discounted prices.

Incorporating these additional tips will help ensure your back-to-school shopping is as cost-effective as possible, allowing you to beat inflation and stay within your budget.

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Your Ultimate Pre-Vacation Checklist: Financial and Practical Tips

Melanie Tarrant on July 30, 2024

Your bags are packed, your itinerary is set, and you’re counting down the minutes until you take off for your dream summer getaway. Before you head out to the airport, though, read through this checklist of important things to remember, especially when it comes to your finances.

1. Notify Your Credit Union About Your Vacation Plans

Give us a call at 866-508-2428 before you set off on your vacay. Let us know your vacation destination so we can honor any card transactions you make while in another state. If you’re traveling overseas, ask us about foreign transaction fees and best practices for using cash and cards. We’ll help you make the best decisions for managing your money while you’re away.

2. Check Your Auto Insurance Plan

If you plan on renting a car, check with your auto insurance provider to find out if rental cars are covered in your policy. This can save you from purchasing unnecessary additional coverage. Contact AGCU Insurance to learn more about your insurance options

3. Pay Your Bills

Before heading out, make sure all of your monthly bills are paid up. You don’t want to be busy paying bills during your vacay or risk getting late fees. Log in to your AGCU account, or open one here to set up automatic payments for peace of mind.

4. Automate Your Email

Set up an automatic email response that lets people know you’re out of the office. This avoids appearing unprofessional or unresponsive and keeps your contacts informed.

5. Hold Your Mail

If you’ll be gone for a while, ask the USPS to hold your mail at the post office until your return. You can do this online and prevent your mailbox from overflowing.

6. Unplug Electronics

Pull the plug on all small appliances and electronics before you leave to prevent vampire energy leakage and potential fire hazards.

7. Clean Your Home

Before your departure, give your house a thorough cleaning. Dispose of any perishable food items from your refrigerator to avoid coming home to unpleasant odors. Consider eating or donating food that will expire while you’re away. You’ll be greeted by a spotless, clean-smelling house upon your return, and you’ll help avoid an invasion by ants or other critters.

8. Inform Your Mobile Service Provider

If you’re traveling abroad, check with your cellphone company about possible overseas service plans that allow you to use your smartphone for calls, texts, and internet access when on vacation.

9. Turn Off Your Water Supply

Avoid coming home to a flood by turning off your water supply before leaving. This simple step can prevent major water damage. This tip is especially helpful if you’re house is in a climate where pipes can freeze

10. Adjust Thermostats

If you have the AC blasting throughout the summer, remember to adjust your thermostat before leaving. Turning it off completely is unwise, as you’ll want some air to circulate to keep humidity under control and avoid mold growth. Also, set your hot water heater to vacation mode/setting.

11. Use a Timer for Lights

Keep the prowlers out by setting your lights to go on and off in different rooms and at different times of the day throughout your vacation.

12. Confirm Your Reservations

It’s a good idea to confirm your flight, hotel room, car rental, and attractions before setting out on your trip. This ensures you have everything in order and can avoid any last-minute surprises.

13. Exchange Currencies in Advance

If you’re traveling internationally, exchange some currency before you leave. This saves you from the hassle of finding a currency exchange service upon arrival and often provides better exchange rates.

14. Secure Your Home

Make sure all doors and windows are locked securely before you leave. Consider installing a home security system or using a security service to monitor your home while you’re away.

15. Inform a Neighbor or Friend

Ask a trusted neighbor or friend to keep an eye on your home. They can collect any packages, check your property, and ensure everything looks normal. Provide them with your contact information in case of emergencies.

16. Manage Your Subscriptions

If you receive any newspaper or magazine deliveries, pause these subscriptions to avoid them piling up and signaling to others that you’re not home.

17. Prepare for Emergencies

Leave a copy of your itinerary and important contact numbers with a trusted person. Make sure they know how to reach you in case of an emergency.

18. Double-Check Travel Documents

Ensure all your travel documents, such as passports, visas, and driver’s licenses, are up to date and easily accessible. Make copies of these documents and keep them in a separate location from the originals.

19. Check Weather Conditions

Check the weather forecast for your destination and pack accordingly. This can help you avoid unexpected weather-related issues and ensure you have the right clothing and accessories.

20. Pack a First Aid Kit

Include a basic first aid kit in your luggage. This should contain bandages, antiseptics, pain relievers, and any prescription medications you may need.

21. Back Up Important Data

If you’re taking electronic devices like laptops or tablets, back up important data before you leave. This ensures you don’t lose any vital information in case your device is lost or damaged.

23. Set Up Mobile Banking Alerts

Enable mobile banking alerts to monitor your accounts for any unusual activity. This allows you to quickly respond to any potential fraud or issues while you’re away.

24. Pack Smart

Make a list of all essential items you need to bring and check them off as you pack. Remember to include chargers for your devices, travel-sized toiletries, and any other necessities.

25. Review Health and Safety Guidelines

Check the health and safety guidelines for your travel destination, especially if you’re traveling internationally. Be aware of any vaccinations, health advisories, or safety concerns.

26. Plan for Pets

If you have pets, arrange for their care while you’re away. This could mean hiring a pet sitter, boarding them at a kennel, or asking a friend or family member to look after them.

By following these tips, you’ll be well-prepared for a relaxing and enjoyable trip. Safe travels!

Banking With A Purpose

Much more than a catchphrase, our tagline is our passion, our reason why we do what we do. This is the impact of your membership with AGCU.
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What is a Credit Report?

Melanie Tarrant on July 18, 2024

Your credit report affects a dizzying array of things that go on in your life, so you really need to know what it is and what affects it. We’ve got the total breakdown!

Keeping Your Personal Information Up to Date

Melanie Tarrant on July 15, 2024

Having your current address, phone number, and email on file ensures that you receive important notifications and updates about your account. It also helps prevent your account from becoming dormant and potentially classified as unclaimed property.

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