Money

Unfortunately, for a lot of folks, these lessons come later than they should, and often as the result of something going terribly wrong. Not enough people make financial education a priority for children, which results in young adults entering a surprisingly complex financial world without the tools necessary to survive and thrive.

Even if your children are very young, remember that the sooner you start teaching them money and personal finance skills, the more apt they’ll be at applying those skills when the time comes.

Check Your Attitude

One of the most difficult issues parents have to face is step one – examining your own attitudes about money. This is extremely important because your children learn more from what they see you do than from what you tell them. You can preach to your kids every day that “A penny saved is a penny earned,” or that “A fool and his money are soon parted,” but it won’t do any good if they see that you waste your own money consistently.

Be an Open Book

It is very important to communicate openly with young kids about money, in simple terms that they can comprehend. Too often, young adults have to learn about credit and debt the hard way: by fending for themselves. It’s better that they learn about personal finances under the guidance and tutelage of someone who’s already been there – their parents.

Involve Children in Family Financial Planning

While a young child won’t necessarily understand or appreciate the finer details of budgeting and investing, it can be very helpful to keep them informed of the broad strokes of your family’s financial plan. If you can help them understand that money isn’t limitless and that careful planning is needed for all major (and many minor) spending decisions, that can go a long way towards positively shaping their understanding of personal finance.

Give Children a Chance to Be in Control

If you give your child an allowance, let them be in charge of spending it. This is a great way to teach the relationship between their actions and the positive or negative consequences that follow. The key, of course, is to talk about their choices and help them understand why money spent today isn’t available tomorrow. You can also open a savings account in their name and let them make deposits, so they can see the value in building savings.

Provide Extra Income Opportunities

Allowance is nice, but it’s helpful to show children that money is something you earn, not something you are entitled to. Considering offering children opportunities to earn money, rather than just handing it out. This is also a great way to show them the value of hard work and hand off a few of the less unenjoyable household chores.

Take Children Shopping With You

You can use routine shopping trips as an opportunity to give children a sense of scale when it comes to money, showing them that some things are more expensive than other things. You can also explain to them why you buy the things you do. By showing them the details you take into consideration, you’ll be teaching them how to be a more mindful consumer.

Union Plus Credit Counseling

Union members can get a no-obligation money and credit assessment from certified, experienced consumer credit counselors though Union Plus Credit Counseling. Powered by the non-profit Money Management International (MMI), your free session will cover a complete financial review, assistance in budgeting, advice for working with creditors, and more.

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Emergency Savings

At a minimum, you should have enough money available (and easily accessible) to cover three months’ worth of expenses. Six months’ worth is better, but three is a solid beginning. How do you arrive at that figure?

Start with living expenses. Add up three months’ worth of rent or mortgage payments. Look at your utility bills and add three months’ worth of each to the total. For more variable bills, like electricity and heating, use numbers from the more expensive months in your calculations. Use receipts and bank statements to find out what a typical month of groceries and dining out costs you (keep in mind, if your income does suddenly stop, you’re very likely to start spending significantly less than you currently do).

Keep in mind that thanks to inflation, those figures will always be going up. So once you’ve put together an adequate amount of emergency savings, you should ideally review that amount once a year to make sure it’s still sufficient to cover your needs.

Finally, emergencies can happen at any time, so make sure you can access your emergency savings at any time – and hopefully with little to no penalty.

College

By the time a child born today is ready for college, four years at an in-state public university is going to cost around $100,000. So it’s pretty reasonable to want to get a head start on savings.

Saving for college, however, should probably be on the lower end of your priorities, well behind building up an emergency savings account and saving for retirement. Thanks to the ready availability of financial assistance and tuition loans, it isn’t a necessity to have funds saved up in advance.

Your best option may be to open up a 529 plan, which include helpful tax breaks, can receive contributions from anyone (making them a nice gift-giving option), don’t expire, and can even be cashed out without penalty if your child gets a full scholarship.

House

You could theoretically purchase a home with no money down, but that’s far from ideal. Without getting too bogged down into the science of mortgage rates, the more you can bring to the table as a down payment, the better off you’ll be. A sizable down payment means more initial equity for you and less risk for the lender, which can help you get more favorable terms.

In that sense, the more you can save for a down payment, the better. But if you’re looking for a number, you should really try to make a 20 percent down payment your goal. Why 20 percent? The answer is Private

Mortgage Insurance, or PMI.

Lenders require PMI on any mortgage that represents 80 percent or more of the home’s value. This insurance is to help protect lenders against a potential foreclosure and it can be costly – it may run as high as 1.5 percent of the loan value per year, depending on your credit score and other factors. It’s a cost you can avoid by saving enough for a 20 percent down payment. You can use listing sites like Zillow.com to see what the median sales price is for homes in your target area and determine how much you need to save in order to get your 20 percent.

Retirement

Most retirees require between 70 to 90 percent of their pre-retirement annual earnings in order to live comfortably during their retirement years. So if your income were around $100,000, you would need – at minimum – around $70,000 (per year) in savings. That “per year” bit is a little hard to quantify, because (not to be grim or anything) you don’t necessarily know how long you’re going to live.

In the United States right now, the average age of retirement is 63. Life expectancy is currently 78.8 years. For the example above, a retiree would want a nest egg of at least $1,120,000. Which is a lot. It’s also completely achievable if you start early and make a concerted effort to save regularly throughout your adult life.

You can use the figures above to help you get a sense of what you’ll need to build up, but keep in mind that inflation will impact both your future earnings and the future cost of goods and services. If you haven’t already, it may be a good idea to work with a financial advisor to help you sort out a plan to get you ready for retirement.

Union Plus Credit Counseling

Union members can get a no-obligation money and credit assessment from certified, experienced consumer credit counselors though Union Plus Credit Counseling. Powered by the non-profit Money Management International (MMI), your free session will cover a complete financial review, assistance in budgeting, advice for working with creditors, and more.

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Make a Plan

Before heading to the grocery store, do some preparation in advance. Have a selection of different recipes and meals that your family enjoys, and make sure you know all of the ingredients needed. Cut out coupons in magazines and newspapers for items your family uses, and check the grocery sale papers before you head out to make sure you know exactly what is on sale.

Manage Your Urges

Time your shopping trip to occur right after you eat, so that you aren’t hungry and more prone to impulse buying. If your children are inclined to pull cookies and sugary items off the shelves, you may want to leave them at home.

Hunt for Sales

When shopping, instead of purchasing items related to your menu and recipes for the week, you can also plan your menu around what’s on sale that week. While fresh fruits and vegetables can often be expensive and rarely have coupons, in-season produce is generally cheaper. Look for discounts and good deals – just be sure to steer towards foods your family will actually eat. Local farm stands or farmers’ markets are another way to get reasonably priced fresh produce.

Use Bulk Wisely

Also take advantage of “buy one, get one free” sales and bulk discounts. Having a good storage system in place will make food less likely to go to waste. When freezing meat products, write the date of purchase on the package so you know when you’ll need to eat it. Cleaning out your freezer frequently can help you know exactly what food you have available. Soups, pastas, and canned goods are great to purchase in large quantities when they are on sale.

Also, if you have a warehouse club near you, compare prices and consider sharing purchases with a nearby friend or relative. Make sure you have willpower though, or else you’ll come out with a basketful of bulky items you didn’t plan to purchase.

Dried, Canned, and Frozen

Dried items such as beans can be a great, healthy alternative to meat, and are generally reasonably priced. Beans can be added to salads, rice, and soups to add more protein. Also, consider purchasing canned (with no added salt) or frozen vegetables and fruit, which usually contain the same nutrients as fresh food.

Union Plus Credit Counseling

Union members can get a no-obligation money and credit assessment from certified, experienced consumer credit counselors though Union Plus Credit Counseling. Powered by the non-profit Money Management International (MMI), your free session will cover a complete financial review, assistance in budgeting, advice for working with creditors, and more.

LEARN MORE

What’s Under Your Policy’s Hood?

So your homeowner’s policy is very likely to cover a bit more than just your home. Therefore, it’s important to understand exactly what’s covered and for how much. Most policies typically offer the following types of coverage:

• Dwelling
• Other structures
• Personal possessions
• Loss of use
• Personal liability
• Medical payments

Dwelling – More than Just Your Mortgage

One common mistake homeowners often make is to only get enough insurance coverage to cover the cost of their mortgage. Your mortgage, however, does not represent the actual value of your home, or the cost to replace the home as is. Ultimately, what you want is enough insurance to completely rebuild your home in a worst case scenario. Your best bet would be to hire a builder to assess your house and provide an estimate for current replacement costs. Insurance agencies also sell “guaranteed replacement cost” insurance, which – as the title implies – guarantees that you’d be covered for the full cost of replacement, but those policies are costly and hard to come by.

Alternately, you can get “extended replacement coverage”, which in most cases means the insurer will pay out up to 125 percent of your policy limit towards rebuilding your home. Some insurers offer an “inflation guarantee”, which increases to cover changing costs over time. Otherwise, you’d be wise to routinely review your dwelling coverage against the actual cost to replace – materials and services are likely to increase in cost over time, meaning total replacement may require a higher policy limit.

Special Circumstances

Depending on where you live and what hazards your house faces, you may need to purchase additional types of coverage. The most common type of supplemental insurance is flood insurance. In many locations, flood insurance may actually be required by your lender before closing on a mortgage.

Unfortunately, the reason flood insurance exists is because most regular homeowner’s policies don’t cover damages related to flooding. If you’re unsure about whether or not you need flood insurance, you can visit FloodSmart.gov, which is the National Flood Insurance Program’s website.

Other Structures and Personal Possessions

Coverage for “other structures” generally refers to unattached buildings (like a shed) or fences on your property. As with dwelling coverage, ideally you should have a policy limit high enough to fully replace these structures should they be destroyed.

Personal possessions, as a category, can be a little trickier. A popular rule of thumb is to insure your possessions for about 50 to 75 percent of your dwelling coverage, and then purchase additional coverage for any possessions of exceptional value (like expensive pieces of jewelry). If you’d like to be a little more accurate, you can use an app or a program like KnowYourStuff to create a complete catalog of all of your possessions.

Loss of Use, Personal Liability, and Medical Payments

Loss of use coverage represents money that would be available to you if you were temporarily displaced from your home and needed to stay somewhere else. It’s a bit like the rental car coverage you may have included in your car insurance.

Personal liability and medical payment coverage are there to protect you in the event someone is hurt or injured on your property. Medical payment coverage specifically covers medical bills for you or anyone else who suffers an injury on your property, while personal liability kicks in if you’re sued for injuries or damages occurring on your property.

Without adequate personal liability coverage, your savings and other accumulated assets could be at risk if an incident occurs. It’s hard to know exactly how much personal liability coverage is the right amount, but you should definitely consider the relative risk factors (Do you have a swimming pool? Is your home more than one floor? Etc.) when deciding on an amount.

Your Deductible

Finally, while homeowner’s insurance is expensive to have, it’s also expensive to use. Like most forms of insurance, if the cost of a repair is low enough to handle out-of-pocket, it’s usually in your best interests to do so. That’s why it’s often preferable to choose a policy with a high deductible, since a higher deductible usually means a lower premium, which can represent a significant savings over time. It’s a good idea to earmark a portion of your savings for out-of-pocket repairs or covering your deductible so you’ll be prepared if something goes wrong.

Need a little more help? MMI offers homebuyer education courses for anyone looking to buy a new home. Whether you're a first-time homebuyer looking to learn the basics or current owner in need of an education certificate for a specialized loan program, these online courses are thorough, informative, and easy-to-use.

Susan White originally decided to join the union because the job was located in close proximity to her home and the pay was good. For 13 years, she worked as a United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) member in an automotive assembly plant near Statesville, NC.

“I was an assembly setup press operator, assembly line operator, inspector, tagger, labeler, boxer – a jack of all trades really. At the plant, we assembled car parts,” she explained.

White entered the Union Plus 30th Anniversary American Dream Sweepstakes after learning about it through a Union Plus e-newsletter. She was elated when she found out she had been randomly drawn as a $500 winner.

The Union Plus member benefits program is celebrating three decades of serving union members with an American dream-themed sweepstakes sponsored by the Union Plus Credit Card Program.* Each week, 12 winners were randomly drawn to receive a $500 Mastercard® gift card prize. And, one winner, Frank Valone, an AFSCME retiree, was drawn to win the $30,000 grand prize.

White has participated in the Union Plus Credit Card Program for the past two decades and considers it one of her most valued Union Plus benefits, as it has enabled her to establish good credit.

When asked how she would describe the American dream, she spoke about home ownership and the benefits of union membership.

“The American dream right now is being able to survive and keep my house,” she said. “Unions fight for fair wages and benefits for members. They keep our wages going up, save our benefits, and keep our health insurance costs at a minimum. They do a very good job at those things.”

White plans to put her $500 toward the basics. “I’m going to use the money for my essentials right now because that’s where it’s most needed,” she said.

To read the stories of the Union Plus American Dream Sweepstakes winners, visit unionplus.org/winners.

Recently retired International Brotherhood of Electrical Workers (IBEW) Local 96 member Bill McMilleon of Pekin, IL, boasts a union career dating back to 1969.

“I was a union electrician in the construction field and I worked on projects like schools, hospitals, and power stations. During the past 22 years, I worked as an electrician in a steel mill. My duties varied with each individual job. Some jobs were a few weeks long, while others lasted several months,” he said. “Through my years with the union, I worked in the same role in both Massachusetts and Illinois.”

McMilleon was ecstatic to learn that he was drawn as a $500 winner in the Union Plus 30th Anniversary American Dream Sweepstakes.

The Union Plus member benefits program celebrated three decades of serving union members with an American dream-themed sweepstakes sponsored by the Union Plus Credit Card Program.* Each week, 12 winners were randomly drawn to receive a $500 Mastercard® gift card prize. And, one winner, Frank Valone, an AFSCME retiree, was drawn to win the $30,000 grand prize. Read his story here.

When asked how he would describe the American dream, McMilleon said it is reflective of the life he is currently living.

“The dream is about being able to own a house and support your family. I think unions help members reach those goals by providing fair working opportunities,” he said.

With $500 extra in his pocket, McMilleon wants to put the money toward his beloved hobby of woodworking.

“I’m probably going to use it to buy a new table saw. I like to make furniture and various things for my grandkids.”

To read the stories of the Union Plus American Dream Sweepstakes winners, visit unionplus.org/winners.

In 1978, Peggy Kienle of Pottstown, PA, began her career as a telephone operator and Communications Workers of America (CWA) member.

“The company I worked for created an entirely new department to set up toll free 800 service for customers, which I was part of. I started out as a telephone operator connecting long distance calls,” she said.

Kienle was overjoyed to learn that she was randomly selected as a $500 winner in the Union Plus 30th Anniversary American Dream Sweepstakes.

The Union Plus member benefits program celebrated three decades of serving union members with an American dream-themed sweepstakes sponsored by the Union Plus Credit Card Program.* Each week, 12 winners were randomly drawn to receive a $500 Mastercard® gift card prize. At the end of the sweepstakes period, one winner, Frank Valone, an AFSCME retiree, was drawn as the winner of the $30,000 grand prize. Read his story here.

Kienle is a fan of many of Union Plus’ discounts and benefits, and her favorite is the Union Plus Credit Card Program, which she has been enrolled in for over two decades.

When asked for her definition of the American dream, the sweepstakes theme, Kienle said it boils down to the basics.

“It’s about having a roof over your head, enough food, and a decent paying job that helps you support your family. For most of my life, I believe I’ve lived the American dream. The unions help fight for a decent wage and benefits for union members,” she explained.

Kienle used the money she won to shop for gifts, among other things.

“I used it to buy an Amazon.com gift card for each of my grandkids, and to cover the cost of gifts and shipping those gifts to each of my three children. I have $10.18 left and I think I may spend those last dollars at the grocery store.”

To read the stories of the Union Plus American Dream Sweepstakes winners, visit unionplus.org/winners.

At the age of 87, Florence Gardy doesn’t skip a beat when talking about her 29-year career as a registration coordinator at a local university and her union membership with the American Federation of State, County and Municipal Employees (AFSCME). During her working years, she assisted students with enrolling in their classes each semester. It was a job she thoroughly enjoyed.

Now, Gardy, of Harpursville, NY, is talking about being selected as one of the lucky $500 winners in the Union Plus 30th Anniversary American Dream Sweepstakes.

The Union Plus member benefits program celebrated three decades of serving union members with an American dream-themed sweepstakes sponsored by the Union Plus Credit Card Program.* Each week, 12 winners were randomly drawn to receive a $500 Mastercard® gift card prize. At the end of the sweepstakes period, one winner, Frank Valone, a fellow AFSCME retiree, was drawn as the winner of the $30,000 grand prize.

Gardy participates in the Union Plus Credit Card Program and has carried an AFSCME Advantage Credit Card since the 1980s.

“The customer service is great. One time, someone stole my card number, and a customer service representative was working on my situation immediately. That reason alone makes me a fan of the credit card program,” she explained.

Now with $500 in her pocket, Gardy said she has extremely specific plans for how she will spend it.

“I’m going to give a percentage of it to my church, and then I’m going to buy me the best KitchenAid® stand mixer in the color red. I don’t care what anyone has to say about it!”

To read the stories of the Union Plus American Dream Sweepstakes winners, visit unionplus.org/winners.

David Fairhurst, of Brooklyn, NY, has always been an aficionado of the arts. As both an Actors’ Equity Association (AEA) and a Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) member, his professional background includes both television acting and theater.

“For myself, and most actors, the day-to-day consisted of looking for work mostly —sending out headshots, going to auditions, researching upcoming projects. When you’re an actor, you actually spend most of the time not acting, but looking for work,” he explained. “I had some small roles in TV shows, like Law & Order. I also did a lot of theater as well.”

Fairhurst recently learned that he was randomly drawn as a $500 winner in the Union Plus 30th Anniversary American Dream Sweepstakes.

The Union Plus member benefits program celebrated three decades of serving union members with an American Dream-themed sweepstakes sponsored by the Union Plus Credit Card Program.* Each week, 12 winners were randomly drawn to receive a $500 Mastercard® gift card prize. And, one winner, Frank Valone, an AFSCME retiree, was drawn to win a $30,000 grand prize. Read Frank’s story.

When asked to describe what the “American dream” means to him, which was the theme of the sweepstakes, Fairhurst spoke to the value of work passion and the protection that unions offer.

“I think the American dream is being able to make a living doing work that you love, that is respected - and hopefully making more money than your parents did!” he laughed.

“I think unions certainly have a long history of helping members achieve the American dream. It’s very easy to exploit actors because they’re mostly young, very ambitious, and desperate to work - even for free. But you can’t make a living that way. There needs to be some standards and basic salary requirements. Without the AEA and SAG-AFTRA, it would be impossible to be an actor. That’s what’s great about them.”

Fairhurst told Union Plus that the $500 he won is, “more than likely going to end up being spent on gifts for family and friends.”

To read more Union Plus American Dream Sweepstakes winners’ stories, visit unionplus.org/winners.

It seems that as long as people exist, there will be scams. Methods change with time, but at their heart, scams will always be about preying on your fears. The most effective scams are the ones that successfully use your desire to help others and stay out of trouble against you.

The “Can You Hear Me?” Scam

This particular scam started picking up steam late last year. It’s essentially a robocall (automated dialer) with a recording that asks something to the effect of, “Can you hear me?” The question itself may change, but it’s usually designed to elicit a “Yes” from whoever answers the phone. The scammer wants to get a recording of you saying “yes”, which they can then use to initiate calls with financial institutions and creditors, in the hopes of accessing your accounts.

Just hang up. If able, avoid calls from numbers you don’t recognize.

The FBI Calling Scam

This scam comes in many different shades and hues, but it basically amounts to a scammer calling from an official seeming number and demanding a payment.

Recently, there has been a rash of calls from scammers spoofing local FBI field office phone numbers. Based on what your caller ID is telling you, it looks like a legitimate call from the FBI. So when the person on the line starts demanding that you make an immediate money order payment on old student loans or unpaid parking tickets or else risk being arrested, you’d be forgiven for rushing to do as they say.

These kinds of calls can also come from places like the police or the IRS. Of course, the FBI, the IRS, and your local police department are not debt collectors. They will never call you and ask for a payment. So feel free to hang up.

As a general rule of thumb, never make a payment or give out sensitive information on a phone call you did not initiate. If you’re curious about the debt mentioned, follow up with your creditor directly. Just don’t use the phone number the caller provides – look up the phone number from a credible source.

Unsolicited Check Scams

Recently, consumers in multiple states have received checks in the mail, along with instructions. The instructions are for a “mystery shopper” program (most often at Walmart), and direct recipients to cash the checks, use the money to purchase a MoneyGram at a particular store, and then complete a survey on the experience.

Financial institutions can only hold funds for so long – unfortunately, not long enough to verify that the check is a fake. By then you’ll have sent a MoneyGram to the scammers and you’ll be on the hook with your bank or credit union in the amount of the bounced check.

Mystery shopper programs do exist, but they don’t typically hire strangers through the mail. There are a lot of variations on this scam, so make it a point to never, ever cash a check from a stranger, especially if that check comes on the condition that you “repay” some amount or wire funds to a third party.

Charity Scams

Scammers aren’t ones for ethics. Sadly, that extends to bilking money out of good citizens in the name of legitimate charities. Consumers in Indiana were recently victimized by a series of phone calls from scammers claiming to be soliciting donations on behalf of the Indiana Breast Cancer Awareness Trust. Some scammers even solicit donations face-to-face, pretending to represent a charity.

The safest way to support a charity is to contact them directly, either through their website or a publicly available phone number.

The Fake Kidnapping Scam

As noted above, scammers are all about preying on your emotions. In this extremely unpleasant scam, thieves will call and claim that someone you know (usually a child) has been kidnapped and demand that you make a payment immediately. Scammers gather real information by monitoring your online social accounts. They will demand that you act quickly and not contact the police.

This scam can take a few other forms, but the central idea is that someone you know is in trouble and you need to make a payment right away. The fact that they won’t let you off the phone without a payment is a telltale sign that this is a scam. Step back from the situation and check on the person in question if you’re concerned. Otherwise, just hang up.

Whenever you encounter a scam, don’t hesitate to report it. You can use the Better Business Bureau Scam Tracker to submit scams and the Federal Trade Commission’s Scam Alert page to monitor newly reported scams.

Union Plus Debt Management

Did you know that union members can get free budgeting advice from certified consumer credit counseling advisers? It's true! For union members who need additional assistance in eliminating debt, you can receive an enrollment fee waiver for a Debt Management Plan (DMP) available through Union Plus Credit Counseling.

Learn More