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Updates and News

We have an Updated Fee Schedule which will take effect September 1, 2018:

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Card Information Updates and Authorzations:

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The Financial Market 2018, 2019 & Beyond

It is predicted that the U.S. GDP growth will rise to 2.7 percent in 2018, then 2.4 percent in 2019, and again 2.0 percent in 2020. That's according to the most recent forecast released at the Federal Open Market Committee meeting on March 20, 2018. This estimate takes into account the most recent U.S. economic policies.

Interest Rates

The Federal Open Market Committee raised the current fed funds rate to 1.5 percent in December 2017. Maybe some of you noticed but we too adjusted our CD rates now offering:

  • 24 month CD at 1.00% APR

  • 36 month CD at 1.25% APR

  • 60 month CD at 2.00% APR

The Fed expects to increase the fed funds rate to 2.1% in 2018, 2.7% in 2019, and 2.9% in 2020.

The fed funds rate controls short-term interest rates in an effort to keep inflation and unemployment rates in check. It is widely thought that 2018, 2019, and perhaps part of 2020 the US economy will see continued growth and expansion but many Economists are prediction another slowdown or economic “recession” sometime in 2020.

What does all this mean for you?

Well, take advantage now of the low interest rates while they are still here if you need to make a purchase. More than likely if you have looked at a new car lately, the 1.9% car deals are not there anymore. These deals are now in the 2.9% or even 3.25% low introductory APR rate area. Mortgage rates too, have gone from the 3.5% to now 4.25 or even 4.50% and this will only creep higher as the fed rate continues creep up. Of course, you can protect yourself from the Fed's rate hikes by choosing fixed-rate loans wherever possible.

Where these rising rates are a benefit are to the savers of the world. If you have CD’s it’s possible you may see 3-4% CD’s in the next 12-18 months! CD rates will bounce back faster because they are less liquid. This means you have to keep them on deposit with your financial institution for a set period of time. Savings account rates typically have a lower interest rate because you can come in and withdraw them at any time. They react slower but in time they too will be trending up.

The last time the Fed raised rates was in 2005. It helped cause the subprime mortgage crisis. A majority of Americans believe the real estate market will crash in the next two years including most major news media outlets (and of course those guys trying to sell you gold on late night television). I will tell you, I do not believe this is true. While I do think that the real estate market is slightly high right now, it is so because the demand for homes outweighs the supply on hand. This is the OPPOSITE of what we had in 2005 where the supply vastly outweighed the demand. Think of all the real estate flippers flooding the market with not enough people to buy them.

 

So what do I do?

The best advice I think anyone can give on financial wellness is to take the long road and stay the course. Set the right habits in place and try to improve little by little every day, each week, every month, year by year until you find yourself in the place you want to be. Much like dieting, drastic changes are hard to sustain and rarely last. However, building that lifestyle and living it is where you find success.

Continue to improve your financial skills and chart a clear course for your financial wellbeing. If you've invested in the stock market, be calm during any pull-back and see down turns in the market as buying opportunities. DON’T REACT. Plummeting commodity prices, including gold, oil, and coffee, will return to the mean. Right now is an excellent time to reduce debt, build up your savings, and increase your wealth. Try to avoid the distraction of people trying to sell you things.

Don’t be embarrassed. If you are carrying a number of loans and those rates are higher than 15-18%, know there are lower alternatives available. Seek help! Put your money back on the debt and not in the pockets of your creditors by seeking debt consolidation loans and developing plans either with one of our member service representatives or any trusted financial resource officer.

 

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