Banks V.S. Credit Unions

Essentially, banks are for profit institutions where credit unions are non-profit institutions.

Why choose a credit union?

• Typically has higher interest rates on deposits as well as lower interest on loans.
• Emphasis on customer service.
• Non-profit

Why choose a bank?

• More branches in the region or across the country.
• Typically quicker to roll out new apps and other tech.
• For Profit

 

Checking and Savings Accounts

This is what you need to know, you use a checking account to spend the money you earn. A savings account is what you use to, save and profit off the money you earn. Often, a checking account is linked directly to the payroll system at your work, called a direct deposit. the savings account comes in when if you decide to allocate a set amount per paycheck to be deposited into savings. Money is earned on this savings through yearly interest. You give the bank your money to use, they in turn pay you interest on the amount you keep in the account.

 

Great Way to Use a Savings Account

A great way to use a savings account is as an emergency fund. Maintain a balance which overs 3-6 months of living expenses. Because you are keep this money in savings, you are also earning interest. One important thing to note is that there is a legal limit of 6 withdrawals per month from a savings account.

A few great savings account options.

Marcus by Goldman Sachs Online Savings Account APY-1.55% With $0 minimum balance

Capital One 360 Performance Savings™ APY-1.50% With $0 minimum balance

Discover Bank Online Savings APY-1.40% With $0 minimum balance

American Express National Bank Personal Savings APY-1.50% With $0 minimum balance

 

Do You Need Checks?

Simply, you don’t need checks. However, think of a check as a more secure, though less convenient version of a debit card, both function the same way. Often times a check will be used to make large payments, larger than your debit card may allow. If you go to pay for a car in “cash”, what actually happens is you fill out a check for the total amount of the car and that is then pulled out of your account. If you live in an apartment, it is possible that you can bring in a check to avoid paying online processing fees when rent is due. You can even use a check in some grocery stores if you happen to forget your card.

Here’s an info-graphic you can use to learn how to fill out a check.

Buying a Car SUCKS!

Let’s just get this out of the way. No one likes to drop a load of cash on a car, or get locked into a terrible financing deal that lasts 5-6 years. Those who do like it generally have more money than they know what to do with. I’m in college, and I have owned 3 cars in 3 years. No they weren’t crashed, well one was. This may be because I’m impulsive and picky, but I’d like to think it took me a few tries to find the right fit. In doing this, I have learned may tricks within the car sales industry, and I wanted to share with y’all my “professional” opinions.

Basic Rules to Follow

1. Only look if you are ready to buy then and there.Sales people are there to sell, going to a dealership not ready to buy wastes your time and the time of your salesperson. It sounds redundant, but the dealership is there to make a sale out of you. Yes they want to develop a customer relationship, but lets be honest here, you’re always a number in their system.
2. Make the biggest down payment you can! The ideal situation is that you can pay in full, ideal is the key word here. Make yourself follow the 25% rule. Have enough in pocket to pay for 25% of the car you want. $5,000=$1,250 / $10,000=$2,500 / $15,000=$3,750
3. If possible, do all your negotiations via email.I have had the most success when I negotiate my price and options over emails with a salesperson. This can be done through basically any dealer website. Reach out when you find the one, ask what deal they can make you, and NEVER give them a price. You will be asked, “what do you want to pay” you answer should be “not that”.

So you have $5,000

Any car person will tell you, buy a Camry or an Accord, and they have a point. When your not working with a large sum of money, you need to consider cost or ownership and reliability. The Camry and Accord will check both of those boxes. However, they’re boring, and who likes boring. Here are three options that I have found on CarGurus which I think are good all round choices.

1. 2011 Ford Focus 
2. 2012 Mazda3
3. 2012 Ford Fiesta Hatchback

Author’s Note

Notice you don’t see any European car. Cars from Europe are, in most cases, feats of engineering. That engineering costs money to maintain. Do yourself a favor, stick to American or Japanese, parts run cheaper on average, and they are much easier to service.

What About $10,000?

1. 2011 Toyota Prius Five 
2. 2008 Infiniti G37
3. 2016 Hyundai Veloster

Let’s Go for the Big Money! $15,000

1. 2019 KIA Forte
2. 2018 Ford EcoSport
3. 2018 Buick Encore

Be Smart

A car is the worst thing you will ever buy, period, but most of us need one. Don’t get bullied into payments you cant afford, and don’t look until you are absolutely ready. Make sure that you know what you want, you know what is going to suit your needs, and it is something you can afford. Most importantly, when in doubt, get an Accord or a Camry. 😉