Tips to save money in the summer

This was originally published on Monday, May 27, 2019, in the Pacific Daily News.  Click here to subscribe to the PDN.

By making some small changes to your household and lifestyle, you can ease the burden on your wallet without sacrificing the summer fun.

  • Rent heavy duty tools.Summer is a popular time for home improvement and borrowing or renting heavy equipment instead of buying can save you a lot of money. Depending on the scale of the project, you could save thousands of dollars.
  • Keep blinds, curtains closed. Close the blinds on western-facing windows to limit the sunlight entering your home and reduce your air conditioner’s workload. Following this simple tip can decrease the amount of sun-generated heat in your home by up to 77 percent, according to the U.S. Department of Energy.
  • Fill in air gaps.Don’t let precious cool air escape because your home isn’t airtight. By insulating properly and sealing gaps, you can keep cold air inside and reduce the strain on your air conditioner. It’s a fairly cheap fix that can produce significant savings.
  • Keep vents clean and clear. Your air ducts should be cleaned out at least once a year to prevent dust and dirt buildup from reducing airflow. You should also be careful not to block any vents with furniture or decorations.
  • Replace AC filters.Along with keeping your air ducts clean, you should replace or clean your air conditioning filter regularly to prevent it from getting clogged. Swapping a dirty filter for a clean one can reduce your unit’s energy consumption by between 5 percent and 15 percent, according to energy.gov.
  • Moderate AC temperature.It might be tempting to lower that thermostat to 70 degrees on brutal summer days, but you’ll end up paying a hefty price for the convenience. Save 1% to 3 % on your electric bill for each degree the thermostat is set above 72 degrees, according to the California Science Center.
  • Use fans.Turning the air conditioning off and switching on a fan can be an excellent money saver. Fans use less power and keep the air in your house circulating, which makes you feel cooler. Reduce cooling costs by as much as 90% per day by using fans instead of the air conditioner, according to Energy Impact Illinois.
  • Take a cool shower.Taking short, cool showers helps regulate your body’s temperature. You won’t need to run the air conditioner as much, resulting in a lower energy bill.
  • Cook outside.Summer cookouts aren’t just great fun, they’re also great money savers. By taking the kitchen outside, you prevent heat from the stove or oven from building up and eliminate the cost of running those appliances.
  • Turn off lights.It’s a bad habit to leave the lights on when you leave a room. Switching them off can save you a bundle in the long run. Old-fashioned incandescent bulbs give off 90% of their energy as heat, so you might want to switch to a more efficient lighting source.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 24 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at http://www.moneymattersguam.wordpress.com.

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Finding the right real estate agent

This was originally published on Monday, May 13, 2019, in the Pacific Daily News.  Click here to subscribe to the PDN.

A real estate agent who understands your needs can assist you in making a confident decision when buying or selling a home. Real estate agents promote themselves with yard signs and online ads, but finding the right agent can be tough.

You want to ensure that your agent fits your needs and produces the outcome you desire. Here are several ways to find a great real estate agent whether you are buying or selling your home:

Referrals from other clients. One of the best compliments a real estate agent can receive is positive word-of-mouth reviews from satisfied clients. If others were pleased with their experience, chances are you will be, too. Ask agents to provide a list of what they’ve listed and sold in the past year, with contact information.

You want someone who specializes in what you’re selling. It’s best to interview at least three agents before picking one. When interviewing a real estate agent for the job, first look to see that they do a lot of business and if their previous customers are satisfied. Second, go with your gut feeling. If it feels right, they may be the realtor for you.

License, disciplinary actions. Check with your local regulatory body to find out whether an agent you’re considering is licensed and whether the agent has any disciplinary actions or complaints.

Credentials. Like doctors, real estate agents have specialties. Some agents get additional training in particular areas. A real estate agent may have advanced training and credentials. A certified residential specialist has completed additional training in handling residential real estate. An accredited buyer’s representative has completed additional education in representing buyers in transactions. And a seniors’ real estate specialist has completed training aimed at helping buyers and sellers age 50-plus.

An agent who is a realtor is a member of the National Association of Realtors and has formally pledged to a code of ethics.

Experience and knowledge. Ultimately, you want someone who is actively engaged in a particular area and price range. You will want an agent to demonstrate knowledge of the area and real property in your price range. The local licensing authority often can tell you how long an agent has been in business.

Ask about recent selling prices of other neighborhood homes. Is the agent well-informed about the community and special features of the neighborhood? Are they honest about something that could be a concern, such as previous structural damage?

A good agent should know about other properties that are available in the area. If the agent knows the property and can give you a few details, that may indicate he or she really knows the area. You want someone who is knowledgeable about the market.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 24 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at http://www.moneymattersguam.wordpress.com.

Finances critical for college students

This was originally published on Monday, April 22, 2019, in the Pacific Daily News.  Click here to subscribe to the PDN.

College students face many difficult financial decisions when it comes to managing their money. Often, they do not realize that their financial performance in college will impact them long after they graduate.

Decisions they make on using their credit cards, financial aid and spending can impact their job search, their credit score and their ability to pay back what they borrowed. As young adults they need to figure out how to pay for college, earn some spending money and still go to class and get good grades.

  • College is the best time to start thinking about being financially sound and getting into the habit of creating and using a budget. A student’s financial responsibilities are still simple and manageable. It will not take long to create a budget.

It’s easy to lose track of spending and having a budget ensures that they will know exactly where their money is going. Today’s technology makes it easier with apps that they can use directly from their smartphone.

  • Credit card debt.Credit cards are a convenient way to pay for college necessities and can play an important role in establishing a college student’s credit history. Schools sometimes allow financial institutions to come on campus during open house or orientation. The financial institutions usually offer credit cards for college students.

Because students may not have favorable credit yet or do not have income, these credit cards have high interest rates, unfavorable terms and allow students to spend more money than they earn. At times, the financial institution may require parents to be a co-signer.

If the student only pays the minimum monthly payment, they may be stuck paying their credit card debt years after they graduate. In worse scenarios it could affect their credit score and that of their parents, if they are co-signers.

Teach college students how to use credit cards wisely, paying the bill on time and only charging what they can afford to pay in full. Inform them of the consequences if they pay late or do not pay off their debt in full.

  • Peer pressure.Living on their own without parental supervision leaves students open for all sorts of peer pressure. With their newfound independence, some students can get into financial trouble trying to keep up with their friends, who may not be financially savvy or have a larger spending limit from their parents. They may be pressured into eating out more often, buying more clothing than they need, going out on the weekends or planning a costly vacation during their breaks.
  • Failing classes.For many years your child has attended school and followed a strict schedule. Even their after-school activities and homework are carefully monitored. College is very different from what they have been accustomed.

Some professors may not expect students to be in class every session and, depending on their course load, they may have a lot of time that they may consider free. Socializing is also a big part of the college experience. This new freedom could lead to academic troubles and financial troubles.

Dropping classes may result in forfeiture of the tuition and retaking classes is expensive and could prolong their time in college. If it becomes a trend, they may be put on academic probation or, worse, expelled. There may be fees associated with failing a class and loss of scholarships and/or grants. Being accepted by another college will become difficult.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 25 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at http://www.moneymattersguam.wordpress.com.

College students need a budget

This was originally published on Monday, April 15, 2019, in the Pacific Daily News.  Click here to subscribe to the PDN.

College or career school costs can vary significantly and there are many schools with affordable tuition and generous financial assistance. Make sure to research all schools that may meet your academic and financial needs.

Set a budget and stick to it. Determining a budget will help you compare anticipated college or career school expenses against your potential available income and financial aid. You also can use a budget to compare costs between different schools.

  • Tuition and fees:Tuition is the cost of the classes and can vary depending on the school you attend and the number of classes (or credits) you plan to take each semester. The major you are perusing can also influence the price of tuition.

For example, resources and supplies used in engineering or computing may be more expensive than the needs of business majors.

Tuition fees may include student parking, library access, lab fees and other campus services.

You may be required to put a down payment to enroll you in your classes. Most colleges will offer a payment plan.

Tuition costs will also be higher if you are an out-of-state student.

  • Living expenses: Besides the costs of books, tuition, room and board, you will incur other incidental costs. You should enjoy your college experience, attend games, enjoy a night out on the town and take in the local attractions. Balance studies with fun.

Create a budget to help you stay on track. Whether you are living in the dorms or renting an apartment, you will have to purchase necessary items to furnish your new living quarters. Many rentals around the campus have fully furnished apartments to rent.

Other costs may include a computer, printer, microwave, small fridge, bedding and towels. You may also need other equipment for certain classes.

Don’t forget to add mobile phone and seasonal clothing.

To offset some of your living costs, you may want to get a part-time job. Many local restaurants around the campus hire college students. You can also find part-time employment on campus.

  • Health care: Most young adults can stay on their parents’ family health plan until they turn 26, even if they are married or not living with their parents. Some schools offer a student health plan which can be an affordable way to get basic insurance coverage.

According to the healthcare.gov web site, a student health plan will count as qualifying health coverage. This means you are considered covered under the health care law and won’t have to pay the penalty for not having insurance. Be sure to check with the plan to be sure.

If you are under your parents’ family plan, be sure to find what local hospitals and clinics will accept your insurance and how much will be your co-pay.

  • Travel:You may want to include a yearly flight back home. If mass transportation isn’t available, you may also want to think about how you will get around. If you purchase a car, remember to add insurance, fuel and maintenance to your budget.

If you live off campus and public transportation is available, you will want to add that into your budget as well.

Bicycles are a great mode of transportation while in college. The added benefits using a bicycle is you get a little exercise, you can lock your bicycle near your classroom and you avoid parking fees.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 25 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at http://www.moneymattersguam.wordpress.com.

Costs associated with college

This was originally published on Monday, April  , 2019, in the Pacific Daily News.  Click here to subscribe to the PDN.

Paying for college is expensive and many families are feeling the pinch as tuition costs soar. Converting dollars into knowledge isn’t cheap these days and it gets more expensive every year.

College tuition prices are a lot higher today compared with two decades ago. According to U.S. News data, the average cost for tuition and fees among national universities has risen significantly since the late 1990s.

Increases aren’t limited to universities; costs at other four-year institutions and community colleges have also risen.

SAT/ACT: Taking the SAT and the ACT tests cost money. For both tests, you can send your scores to four colleges for free. However, if you are applying to more than four schools, you will need to cover the cost to send the additional scores.

A waitlist fee can also be assessed if you register after the late registration deadline and are seated on the test day. If you change the test date or the location of the test, that too will cost.

Both tests have an optional service that sends you the test questions and the correct answers for a fee. There’s another fee if you need to expedite sending your scores.

Transcripts: You will need to send your high school transcripts to the schools to which you are applying. If you are going directly from high school into college, speak with your guidance counselor to understand the cost and process for doing this.

If you graduated from high school a while ago, you will have to contact your high school. Be aware that there may be a cost for each transcript request. Some colleges may require the transcripts go through a third party that will add extra costs.

Books and supplies: College students pay an average of $607 per year on books and course materials. Some new textbooks can cost more than $100. The cost of the class varies with each term.

To cut costs, utilize gently used books, electronic texts or rent your textbook. You can also sell your books when you are done with your class to recoup the cost of next semester’s book costs.

Application: For each school to which you apply, you’ll likely be responsible for an application fee and maybe a processing fee. According to a study by U.S. News and World Report, the average application fee is about $42.

Room and board: Once you are accepted to the school you wish to attend, you will need to start thinking about where to live. Some universities require out-of-state students to live on campus their first, and sometimes second, year. If you will be living in the dormitories you will likely need to make a deposit to hold your place in student housing.

Some room-and-board costs include a meal plan. Many colleges offer different meal plans to fit your budget. If you are living off campus, you can save money by not opting into the meal plan.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 25 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog atwww.moneymattersguam.wordpress.com.

Getting married? How to discuss money, finances before the wedding

This was originally published on Monday, February 25, 2019, in the Pacific Daily News.  Click here to subscribe to the PDN. 

When two hearts become one wallet, it’s critical that you understand each other’s values on money. Before walking down the aisle, you and your soon-to-be should have the money talk.

The talk isn’t always an easy conversation to have. However, these talks should be a priority, since poor money communication can lead to unhappiness in a marriage. Merging your finances and your lives may be challenging without a firm foundation. As difficult as the talks may be, each partner needs to bring honesty and realistic goals to the conversation.

Budget. You and your partner need to decide how you want to budget. Include your take-home pay, how much debt you have, how much you have saved, and what you spend monthly. Discuss what each other’s plans are to pay off debt. Discuss your financial goals: whether it be buying a house, going on a vacation, having children, going back to school or when to retire.

Once you create a budget, decide how often you want to go over your expenses. You can also discuss how you are achieving your goals. Talking about money early in the relationship makes it easier as more responsibilities are added to the family budget.

Mine, yours and ours. When entering a relationship, you have three main options for dealing with money:

  • each spouse manages and maintains their own separate accounts and each pays an agreed upon amount per month of household expenses;
  • merging your accounts halfway where each spouse keeps a separate bank account in which their paychecks are deposited. Then there is a joint account that each spouse contributes to which is used for household expenses; or
  • joint checking account in which all paychecks are deposited and from which all expenses are paid from.

Not every couple is the same. What works for your parents may not work for you. It’s important that each person is comfortable with the option that is decided. If after a while it doesn’t work, you can always try a different option.

Prenup. Prenups used to be taboo, but many couples are now deciding to protect their assets before entering a marriage. People are getting married later in life when they have careers, a house and have started contributing to their retirement accounts.

Most lawyers recommend one for both parties, especially if each party is bringing with them a large amount of assets and debt. It is best to use different lawyers to represent each party.

Will. It could be considered an odd time to think about death at a time when you are planning for one of your happiest days. But a will is a vital financial and legal document that each spouse should have.

Create a list of your assets and financial accounts and how you would like them to be divided. If you have children, include who will have custody if the worse should happen. Include in your will who will have custody if something happens to the both of you. The attorney drafting your will may cover all these areas and more.

Insurance. Coming into the marriage, you probably have different insurance companies. As you merge car, home and life insurances, you may want to shop around for different policies and see if they can be bundled to save money. Ask your employer about a two-party or family health insurance policy and how much of a difference it will cost.

If you don’t have life insurance, you may want to consider getting a policy that protects both spouses. It’s best not to wait until you get older since premiums increase.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 24 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at http://www.moneymattersguam.wordpress.com.

Financial tips for 2019

This was originally published on Monday, December 31, 2018, in the Pacific Daily News.  Click here to subscribe to the PDN. 

2018 is just about over. To prepare for the new year, take some time to review your insurance.

Update your insurance. Review your coverage. Does it still cover what is important to you? Did you make a large purchase in the past year? If you did, be sure that your insurance will cover it. If you use photos or videos to keep records of your belongings, it’s time to update them. You can easily store copies of photos and videos online in private accounts. If your computer and paper files become damaged, you will still be able to retrieve online copies from another computer.

Inspect your home. By inspecting your home annually for fire, theft, and flood hazards, and correcting the problems that you find, you can protect your family from perils. You will possibly prevent or limit damage to your home. Did you invest in a new anti-theft system? If you did, you may be able to lower your insurance costs.

Check your doors and windows for gaps where water and hot air can enter. It may take a simple act of weather stripping, but it will save you a lot in power costs and water damage. Look for fire hazards as well. Test your outlets and look for signs of electrical damage. Test your smoke detectors and replace the batteries if necessary.

Insurance discounts. Over the past year, you may have made improvements to your home to safeguard your structure and belongings against major perils. You may have installed smoke detectors, added typhoon shutters, or otherwise weatherproofed and secured your home. Not only do these actions protect your home and your family, but they also may make you eligible for a discount. Create a list of improvements to refer to when you visit or call your insurance broker or agent.

Update your car insurance. If a young driver moves away from home or no longer needs to drive the family car, an annual review can help remind you to adjust your coverage to your current number of drivers. You can also check for car insurance discounts if you have made any changes in the past year, such as installing a car alarm.  Some insurance companies will give discounts to students who have good grades as well.

Adjust your deductible. If you have saved up enough to cover a higher deductible for your car and home insurance, you can adjust your deductible upward to save money on premiums. But before you do this, it’s a good idea to move those funds away from the financial accounts that you use frequently, to a standalone emergency savings account. If it’s easy for you to transfer funds from your savings and into your checking account, you may be more tempted to spend your deductible before you need it.

Discuss your situation with your broker or agent. Your broker or agent can talk to you about the changes you have made over the past year, and help you find discounts of which you are unaware. He or she can also help you re-shop for insurance and find policies that are better suited to your needs and budget.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 24 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at moneymattersguam@yahoo.com and read past columns at the Money Matters blog at www.moneymattersguam.wordpress.com.