Posted by

Anastasia, Apple FCU
 
 
 
Income taxes… they are one of life’s three certainties. [Bonus points to those who can name the other two.] If you found yourself working for the first time this summer, or are currently in the market for an after school job, taxes are a certainty you definitely cannot ignore.
 
No matter what you’ve heard, a part-time job does not equal a tax time free pass. Whether you filled fast food orders, wrangled unruly grade schoolers or mowed miles of lawns, the type of employment doesn’t matter. What does matter is the income you earned for services rendered in 2010.
 
Rest assured, your part-time work doesn’t have to turn into a full-time tax headache. Extract some ideas on how you can prepare for tax season with the IRS’s top six tips for working students. You can also visit the IRS website to learn more about filing requirements that may apply to you.
 

And for those of you still stumped on life’s other two certainties, they are… death and change.
 
 
 

Posted by Dawn, Apple FCU
 
 
Never lend money is a warning commonly offered by financial experts. Not opening your wallet may be the safest approach, but the truth is, many of us at one time or another want to help out a friend or family member in need. If you decide to become a lender, here is how you can do it wisely:
 

1. Don’t lend money you can’t afford to lose: Even if the borrower is 100% dedicated to repaying the loan, stuff happens. Perhaps he or she suffers a job loss or has to pay for an expensive unexpected car repair. You always have to be prepared for the possibility that you won’t receive your money back. If you lend cash that you need to pay the mortgage or other essential expenses, not only are you putting yourself in a precarious financial situation, but you will probably become more frustrated with the borrower if you do not get you money on time, possibly damaging your relationship.
 
2. Get the agreement in writing: Do you remember the exact details of all of the conversations you had yesterday? Last week? Last month? Last year? If you only agree on the terms verbally, it is possible that both you and the borrower will genuinely remember them differently. (The borrower may even think you intended the money to be a gift!) By writing down the repayment terms, including the amount borrowed, interest rate, and payment schedule, there will be no question as to what was agreed to. (It will also come in handy if you need to go to court to collect.) Make sure each of you has a copy signed by both of you. You may even want to have them notarized.
 
3.Be aware of the tax implications: The interest that you earn on a loan is considered taxable income. If you do not charge any interest and the loan amount exceeds $10,000, there may still be tax consequences. The IRS requires loans to come with a minimum interest rate (called the Applicable Federal Rate), and the interest can be considered income even if you don’t actually collect it. It is a good idea to consult with a qualified tax advisor about your tax liability if you are lending this much.
 
4. Give a reminder: Even though the loan agreement should contain the payment schedule, the borrower probably won’t put it in a visible spot. So that he or she does not forget about the payment, give a friendly reminder before the due date. Sending an e-mail is one option. Or you could give the borrower a loan coupon book.
 
5. Communicate and cooperate: If your friendly reminder fails to work, instead of stewing silently or angrily demanding the money, try to communicate with the borrower calmly. If he or she is experiencing ongoing difficulties, can you work out an alternative repayment agreement (for example, accept $100 a month instead of $150)? You would probably prefer to get paid back more slowly than to have the borrower stop paying completely because the payments are not affordable. You can go to small claims court to collect, but it can be time-consuming (not to mention kill the relationship), and it is usually best used when all else fails.

Posted by Theresa, Apple FCU

 
 
 
 
There’s no doubt about it, at one time or another we all have done it—chose something because of its brand name. Well that brand name is likely costing you more than you think.
 
Which water to wet your whistle – Fiji vs. Nestle?
 
According to Fijiwater.com, one case of 24, 500 ml-bottled water is $37.50. That’s $1.56 per bottle. On Costco.com, one case of the same size bottled water (Nestle brand; think Deer Park, Poland Spring) costs only $6.99 – making  it only $.29 per bottle!  Total savings: $30.51 by selecting the ‘lesser’ Nestle brand bottled water.
 
Buy This: Nestle brand water
Not This: Fiji brand water
 
While some may argue that one tastes better than the other, one must consider the opportunity cost, or the $30.51. Opportunity cost is what you give up to get what you choose. For example because you choose the water you like better, you forfeit the $30.51 cost difference of the cheaper water. If you experience pleasure because the Fiji tastes better and you believe it’s a better product you have to think, “Is it worth the additional cost over a comparable offer?”—and to some people it is.
 
After all, we all have our own personal preferences—but maybe it’s time to reevaluate and ask yourself “Is it really worth it?”
 
Stay tuned for the next “The Cost of Brand Loyalty…”
 

Posted by Cristian, Video Contest Winner/Guest Blogger