Financial Tips & Resources

Not only are we here for our customers in terms of products and services, but we make it a priority to provide tips and educational resources as well. That way you can have confidence in your ongoing financial decisions. We have cultivated some proud partnerships encompassing money management, fraud prevention, helpful tips, and much more, in order to offer you detailed guidance.

Choose from our list of helpful resources below for a few tips, a refresher, or a thorough educational experience.

How to Borrow From Your IRA without Paying a Penalty

Here's how to borrow from your IRA without paying a penalty:

Whether you need a stack of cash to pay college tuition for two students this year, or to pay it for two or three years to come, you are among many people who have big expenses coming up.

Fortunately, you can take money from your IRA penalty-free at any age, and for any purpose, if you follow certain rules. Early-out payments are known as 72(t) distributions, named for the section of the tax code that authorizes them. The provisions allow you to take "substantially equal" distributions for at least five years or until age 59 1/2, whichever is longer.

If you have more than one IRA, you can choose to take distributions from just one account. If you have only one account, you can split off a portion of it into a new IRA to satisfy your early distribution requirements and let the remainder continue to grow tax-deferred.

Try the free calculator at www.72t.net to estimate how much you can withdraw under three different distribution methods.

The site also lets you calculate in reverse. Start with how much you would like to withdraw each year and you can see how much you need in an IRA to satisfy the withdrawal schedule.

You have to follow the plan once you're into it. There's a big penalty if you deviate from the distribution schedule once it's set up. Advisors at Kiplinger Personal Finance remind you that if you do deviate from the schedule, you'll owe the 10 percent withdrawal penalty retroactively on all your plan withdrawals.

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Tips Every Home Buyer Should Know

With low housing prices and mortgage interest rates, it is a good time to explore buying a home. However, today, there are more obstacles to getting a mortgage, including higher credit score standards and closer reviews of applications.

Preparation is key to navigating today's market. ABA offers these tips to help households prepare for buying a home.

Figure out if you can afford to buy. A detailed analysis of your financial situation is central to the decision to buy. Make a budget or all of your current expenses – car payments, credit card debt, etc – and potential mortgage payments, taxes, and homeowner's insurance, aiming to keep all debt payments below 40 percent of your monthly income. Stay within your budget when shopping. Use our mortgage calculators to help create your budget.

Check your credit score. Your credit history is an important factor when applying for a loan. Most lenders rely on the Fair Isaac Corporation (FICO) credit score when reviewing your loan application. The score reflects how well you manage your debt and is calculated using data from your credit report. A lower credit score will result in a higher interest rate on your loan.If your score is too low, you may not be approved for a loan at that time, but there are a number of steps you can take to understand and improve your credit score. Resources are available in this tip sheet.

Consider all the costs. A lender will review costs such as fees, closing costs, points, and homeowner insurance. But consumers should also consider repairs and maintenance costs. As a homeowner, you are responsible for those additional costs – there won't be a landlord to call.

Organize your finances before you go to the bank. While each bank may require different documentation – click here for a more complete checklist – at a minimum you will need:

  • Pay stubs,
  • Tax returns,
  • Financial statements (one that is less than 60 days old),
  • Copies of additional monthly payments such as car loans, credit cards, student loans, etc., and
  • Any additional information – like proof of additional income – that you think will help your banker to positively evaluate your credit request.

Plan for the future. A home is a long-term investment, so if you plan on being in an area only a short time, renting may be a better option. Typically, if you plan on staying in an area less than five years, buying a home may not be worth the cost of the investment. Instead, focus on paying down debt and building saving.

For more information, check out ABA's Homeownership Page.

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Volunteer State Bank Offers Tips During Low Interest Rate Periods

With interest rates at record lows, consumers face a number of choices for managing their money. Whether they want to save, spend, or invest, consumers are encouraged to consider their options and choose the strategies that best suit their particular financial circumstances. Volunteer State Bank offers the following tips on how to take advantage of low interest rates.

1. Consolidate debt. With interest rates at historic lows, it makes sense to consolidate debt into one low interest loan. For example, if you have outstanding balances on several credit cards, consider transferring those balances to one credit card with the lowest interest rate. If you qualify, it may be a good time to apply for a home equity line of credit to consolidate debt or make a home improvement.

2. Shop around for credit cards with the best interest rates. You may be able to get one with better terms than the one you are currently using. Or, ask your credit card issuer to lower your interest rate to make it more competitive.

3. Make large purchases now. If you've been thinking of making a major purchase like a house or a car, today's low interest rates make it a good time to finance big ticket items. However, make sure you have a good credit record and can pay off the loan before applying.

4. Know your credit score. Before you apply for any loan or credit card, check your credit report and learn your credit score. Make sure your score is high to qualify for the very best rates. If your score is low, pay down your balances, remove errors from your credit report, and pay bills on time to raise your score.

5. Keep saving. Make regular savings account deposits a priority and keep saving for your future. Your savings will accrue, you'll be less likely to spend it, and you know it will be safe. If you can afford to lock up your money for a while, longer-term Certificates of Deposit generally pay the highest interest rates.

Low interest rate periods offer a variety of opportunities and challenges for customers deciding how to manage their money. Customers should never take on more debt than they can afford to repay, but this could be a good time to consolidate debt to make payments easier, or make a home improvement you've been thinking about for a long time.

Visit any of our nine Volunteer State Bank branches where we can assist you with your credit needs and savings goals. Member FDIC. Equal Housing Lender.

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June is National Homeownership Month

June Is National Homeownership Month Today there are many choices that allow buyers to find a mortgage that best fits their pocket book and housing needs. To find the right product, the American Bankers Association recommends that buyers:

  • Figure out if you can afford to buy. It may seem like everyone is buying a home so you should too, but first decide if you can afford to buy. Your bank or other online resources can provide a calculator to determine if you can afford to borrow and if so, how much.
  • Do your homework. When considering adjustable rate or interest-only loans, it is important to look at both current and future income. The monthly payment on these loans will rise, so consider this also when looking at your income.
  • Consider all the costs. A lender will review costs like fees, closing costs, points, homeowner insurance, etc. But consumers should also consider repairs and maintenance costs. As a homeowner, you are responsible for those additional costs – there won't be a landlord to call.
  • Organize your finances before you go to the bank. While each bank may require different documentation, the following items are often needed:
  • Pay stubs,
  • Tax returns,
  • Financial statements (one that is less than 60 days old),
  • Copies of additional monthly payments such as car loans, credit cards, student loans, etc., and
  • Any additional information – like proof of additional income – that you think will help your banker to positively evaluate your credit request.
  • Pay off or pay down other loans. Credit cards, auto loans or other small loans should be paid off or paid down before you look for a mortgage. This will help increase your credit score and qualify you for a larger mortgage or lower interest rates.
  • Plan for the future. A home is a long-term investment, so if you plan on being in an area only a short time, renting may be a better option. Typically, if you plan on staying in an area less than five years, buying a home may not be worth the cost of the investment. Instead, focus on paying down debt and building savings. Visit www.volstatebank.com to find financial calculators and the mortgage loan that meets your needs. Equal Housing Lender. Today there are many choices that allow buyers to find a mortgage that best fits their pocket book and housing needs.
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Protect Your Financial Identity

Protect Your Financial Identity from the ABA Education Foundation

Identity theft is one of the fastest-growing types of financial fraud. Without stealing your wallet, a crook can steal your financial identity with as little information as your social security number. It is also called "account-takeover fraud" or "true-name fraud," and it involves crooks' assuming your identity by applying for credit, running up huge bills and stiffing creditors – all in your name. Take these steps to protect yourself:

1. Order copies of your credit report once a year to ensure they are accurate. You can call each of the three national credit-reporting agencies because each may contain different aspects of your credit history, or you can contact the Annual Credit Report Service for one free credit report each year, or 1-877-322-8228.

Equifax 1-800-685-1111 or equifax.com

Experian 1-888-397-3742 or experian.com

TransUnion 1-800-916-8800 or transunion.com

2. Keep an eye on your accounts throughout the year by reading your monthly/periodic statements thoroughly. That's an easy way for you to be sure that all of the activity in your accounts was initiated by you.

3. Tear up or shred pre-approved credit offers, receipts and other personal information that link your name to account numbers. Don't leave your ATM or credit card receipt in public trash cans. Crooks (a.k.a dumpster divers) are known to go through trash to get account numbers and other items that will give them just enough information to get credit in your name.

4. If your credit card or other bills are more than two weeks late, you should do three things: First, contact the Postal Service to see if someone has forwarded your mail to another address. Second, contact your bank to ask if the statement or card has been mailed. Third, contact the businesses that send you bills.

5. When you pay bills, don't put them in your mailbox with the red flag up. That's a flashing neon light telling crooks to grab your information. Use a locked mailbox or the post office.

6. Protect your account information. Don't write your personal identification number (PIN) on your ATM or debit card. Don't write your social security number or credit card account number on a check. Cover your hand when you are entering your PIN number at an ATM.

7. Don't carry your Social Security card, passport or birth certificate unless you need it that day. Take all but one or two credit cards out of your wallet, and keep a list at home of your account information and customer service telephone numbers. That way, if your wallet is lost or stolen, you'll only have to notify a few of your creditors and the information will be handy.

8. Never provide personal or credit card information over the phone, unless you initiated the call. Crooks are known to call with news that you've won a prize and all they need is your credit card number for verification. Don't fall for it. Remember the old saying, "if it sounds too good to be true, it probably is."

More Tips to Protect Your Financial Identity Take action if you are a victim:

1. Financial fraud is a crime; call your local police department.

2. Contact the fraud units of all three credit bureaus. Ask them to "flag" your account, which tells creditors that you are a victim of identity fraud. Also, add a victim's statement to each of your credit bureau reports that asks creditors to contact you in person to verify all applications made in your name. Call the fraud units of the credit bureaus at:

TransUnion Fraud Assistance Department— 800-680-7289

Equifax Fraud Assistance Department— 800-525-6285

Experian Fraud Assistance Department— 888-397-3742

3. Call the Federal Trade Commission's ID Theft hotline at 1-(877) IDTHEFT. The hotline is staffed by counselors trained to help ID theft victims. Check out the FTC Website.

4. Notify your banks. They can help you obtain new account numbers for all of your checking, savings and other accounts. Be sure to pick a new PIN number for your ATM and debit cards. Close all of your credit card accounts and open with new account numbers.

5. Notify the Postal Inspector if you suspect mail theft – a felony.

6. Depending on your situation, you may want to contact the Social Security Administration to get a new Social Security number. Their telephone number is 800-772-1213. You also may want to contact your telephone, long distance, water, gas and electrical companies to alert them that someone may try to open an account in your name.

7. Finally, make sure to maintain a log of all the contacts you make with authorities regarding the matter. Write down each person's name, title, and phone number in case you need to re-contact them or refer to them in future correspondence. More Tips if You Are a Victim of Identity Theft Phishing Scams: consumer tips Questions? Contact the ABA Education Foundation.

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