Buying Your First Car
Buying your very first car is an exciting milestone, but one that is often overshadowed by the stress of financing. Choosing and purchasing your new car doesn't have to be a struggle, though. Follow these helpful hints and you'll be well on your way to the feel-good freedom that can only come from your very own ride.
- First, the fun part. Picture the car of your dreams. Then ask yourself: What do you really need from your car? How often will you use it and what kinds of special features might you want? Think about year-round weather conditions in your area. Consider your daily habits. Try to be realistic, but enjoy yourself too.
- Now, get an idea of your budget. While a loan can be a big help, you also want to establish what feels comfortable to you. How much are you willing to spend on a car in the first place? There are various ways to calculate this, but people tend to spend between 10% and 50% of their yearly income on a car. If you need a car, but you don't care about much beyond getting from one place to another, you'll want to stick closer to the 10% side. If owning a shiny new ride is your reason to live, you're closer to 50%. Most people fall somewhere in between. For example, if you make $35,000 per year and you decide 20% of your income sounds right, you'll be spending $7,000. The same goes for loan and car payments - you probably don't want to be spending much more than a quarter of your monthly income on debt payments. So, make sure your bank account can handle adding a monthly car payment to your existing bills.
- Then for the research. Once you have an idea of your ideal vehicle, take a look at pricing. Check out both new and used models in various locations. Be sure to consult pricing standards for particular models as you go along. The Kelley Blue Book is a wonderful and respected resource for this. As potential cost becomes clearer, determine how closely your dreams and your budget align. If they're not so close, make adjustments until you are looking at cars that are within your price range.
- This is where we come in. Columbia Bank can help you finance the purchase of the car that's right for you. Our auto loans offer up to 100% financing for new automobiles, and up to 80% financing for used cars. Or, you might even consider a home equity loan, if that is an option for you.
Learn more about how a loan from Columbia Bank can help you with your automobile purchase by visiting the branch nearest you. You can also check out our current auto loan rates, or contact a customer service representative with any questions you might have: (800) 522-4167, Monday-Friday 7:00 a.m.-9:00 p.m. (EST) and Saturday 8:00 a.m.-4:00 p.m. (EST).
Saving for College
Refinancing is a word that comes to mind when thinking about mortgages, but what about student loans? Dealing with student debt is tough in any situation. Add in factors like a weak economy, high interest rates, and multiple loan services, and paying off your student loans can feel more daunting than the years of school it took to accumulate them. What many people don't realize is that it's possible to refinance student loans. Here are the three biggest benefits of doing so:
Consolidate multiple separate loans. It's often the case that graduates are juggling several loans, and these loans are often spread between different loan service providers. It can be quite the challenge to keep everything straight. When you refinance, it's often possible to consolidate all of your loans into one monthly payment.
Get a lower interest rate. One of the main reasons to refinance is to save yourself money in the long run. If you are paying down your loans at a high rate of interest (like most recent grads), it makes sense to refinance them into a loan with a lower rate. That means you'll end up paying less total interest on your loans. It also makes it easier to maintain and build good credit.
Pay less monthly. Perhaps the most exciting and immediate result of refinancing your student loans is that the resulting monthly payment should be much less. This, of course, depends on how you choose to refinance, but should you choose to switch to a longer repayment term, your monthly loan expense should drop.
If you are in a position to make consistent monthly payments, it could be in your best interest to refinance. Visit your nearest Columbia Bank branch to learn more about the course of action that is right for you, and feel free to contact a customer service representative with questions: (800) 522-4167, Monday-Friday 7:00 a.m.-9:00 p.m. (EST) and Saturday 8:00 a.m.-4:00 p.m. (EST).
How to Buy Your First Home
Buying a home is easily one of the most significant moments in life. Whether or not your first home will be your last, the process of searching, choosing, and financing is exciting and important. It can also be stressful. Columbia Bank is here to help with a collection of tried-and-true home-buying advice.
- Are you ready? Before you start getting into the nitty-gritty of the search for your dream home, make sure you are at a point in your life to make this choice. If you think you'll move again soon, or if other parts of your life are in a state of flux, it might be a good idea to wait a while. There is no shame in renting, and while you do it you can build up your credit. Consider the general housing climate, as well. What's the market doing right now? Is it stable? Inflated? A good time to buy? If you've considered these things and you decide the timing is right, dive in.
- Start with an open mind. Where do you want to live? Think about different parts of the country. If there are regions you feel interested in, take a few trips. Narrow it down. If you're in love with your current city, take time to consider all the options. Explore neighborhoods you've never thought about. Walk and drive through different areas at different times of the day and week.
- Location is key. Once you've zeroed in on your ideal neighborhood, get in contact with people who live there. Talk to them about what they like and dislike about the area. Learn about the property value of other homes nearby and keep your eyes peeled for those in need of repair. Just one rundown house can bring down the value of an entire block. Research schools in the area. Even if you don't have kids now, you might someday. You also may end up wanting to move again. It's much easier to sell a house that's located in a desirable place.
- Establish a realistic budget. Once you start looking at houses, it's easy to get swept away by what you think might be The One even if it's a little outside of your price range. So, before setting foot in your first open house, establish a budget that won't budge. One of the most important budgeting aspects of buying a house often gets overlooked: the mortgage payment. Often, first-time homebuyers get caught up in the down payment. They save as much as they can then put every penny into the down payment. While this makes sense in theory, it's important that you're able to afford your mortgage payment each month. Plus, buying a home comes with all sorts of expenses you might have forgotten about. From repairs and homeowners insurance to utilities and the expenses of maintaining a yard for the first time, the cost of owning a home adds up quickly. Learn more about our mortgage options, or visit your local branch and a Columbia Bank representative can help you navigate the wilds of buying your first home.
- Get approved before you go. When you feel comfortable with your budget, apply for a mortgage. Once you start visiting potential homes, things move fast. Good houses get taken off the market quickly. The difference between you and another potential buyer could easily come down to timing.
- Hire a realtor. You know what you want, a realtor knows how to find it. It's as simple as that. Sure, you'll have to add this expense to your budget, but a good realtor understands the market, the area, and how to get you the house you want at a price that's reasonable. This will save you time and stress.
- Know what you're looking for. Before you start going to open houses, get clear on the details. Think about the structural layout of your ideal home. Make a list of the things you must have in a home and take it with you as you look at houses. It's easy to add a coat of paint, it's much more difficult to add two more bedrooms. Train yourself to look beyond how homes are staged or set up by an agent. Imagine your own furniture inhabiting the house. What do you need from each room?
- Pay attention to contracts and rules. Congratulations! You found it! Before you sign on the dotted line, read the contract - the whole contract - as well as any neighborhood rules. Your realtor should be willing to go through these things with you. If you're interested in buying a particular house, but you know you want to put a pool in at some point, make sure the community's homeowner association doesn't have any regulations against this. Finding the home for you is just about as exciting as it gets, but don't get too distracted. This might be the most important purchase you ever make - the details matter.
Learn more about how a loan from Columbia Bank can help you with your home purchase by visiting the branch nearest you. You can also contact a customer service representative with any questions you might have: (800) 522-4167, Monday-Friday 7:00 a.m. - 9:00 p.m. (EST) and Saturday 8:00 a.m. - 4:00 p.m. (EST).
Financial Effect of Marriage
You've chosen the person you want to spend the rest of your life with, now for the life part. Getting married means a lot of changes. From buying a house, to combining your book collections, to sharing a closet, things that were once yours are about to become ours. Your finances are no exception. To help keep the transition from single life to married life nice and smooth, Columbia Bank has collected some helpful thoughts and tips on everything from saving for your wedding to filing taxes.
Before the Wedding
- Start talking. Money is an important part of everyone's life, and no two people deal with it in the same way. Talk with your partner about how they have dealt with money in the past and how they would like to do so in the future. Get a sense of where you agree. Get a sense of where your opinions differ. It helps to keep an open mind. Make regular conversations about money a part of your routine.
- Be specific. Once you start feeling more comfortable with the topic, identify how you hope to proceed as a couple. What will change after you've gotten married? What might change even before then? Make a specific plan and timeline around establishing joint accounts.
- Save up for your wedding. A good place to start your joint account adventure is with a savings account. Weddings are expensive. No matter how you slice that cake, costs add up quickly. Saving for something together is good practice, too. Set goals for your savings and be realistic about what each of you feels comfortable contributing.
- Consider a prenuptial agreement. You never know what the future holds. A prenuptial agreement doesn't mean you love each other any less, but it does mean a much easier process should you choose to stop being married at some point. A financial advisor can be a big help during this step and in general. Contact one of the trusted professionals at Columbia Bank for a consultation.
After the Wedding
- Joint accounts or not, the choice is yours. Every couple manages money differently. Some share it all from the very beginning, while others keep separate spending accounts or credit cards for their entire lives. Based on your individual comfort with shared accounts, as well as the information you've gathered in the time before you married, make the choice that's right for you. Columbia Bank has a variety of configurations to fit your needs. Perhaps you'd like to keep a joint savings account and a credit card for shared purchases, but you each want to maintain your own checking account, or open additional individual savings or business accounts. There's no wrong way to do it!
- Set a budget together. Whether or not you decide to combine accounts, you'll want to set a budget. Presumably, you and your partner will be together for a long time. It's important to start planning for that future early on. From daily spending to retirement goals, get it out there in the beginning.
- You don't have to combine debt. In many cases, it's actually a good idea to keep debt separate. Say, one partner has more credit card debt than the other. If you keep all of that debt on that partner's side, there is a better chance the other partner can maintain or build good credit, something you'll want to have sooner than later - homes, cars, kids, oh my! Student debt is tricky, too. Because student loans aren't erased in bankruptcy, you're stuck with them no matter what. If your spouse's name is on those loans and you die or get a divorce, your loved one will continue to be responsible for them.
- File taxes as a couple. Regardless of the date you marry, you're considered married for that entire tax year. So, you'll either file tax returns jointly or as married filing separately. Which you choose usually depends on what will be most financially beneficial to you. Usually filing a joint tax return will save you money, but in some cases this isn't true. If there is a big difference between incomes, you'll probably want to file jointly and you might even get a marriage bonus. However, if your combined income puts you in one of the four highest tax brackets, you may end up avoiding steep penalties by filing separately.
- There are always other things to think about. If you're a student, or planning to be a student, your marital status affects your eligibility for financial aid. Depending on your age and your spouse's income, you may even want to wait until after you finish school to get married. Learn more about the specifics of how marriage might affect your FAFSA application. Getting married also means you are now eligible to receive benefits from your spouse's employer. You'll also automatically inherit his or her assets, receive Social Security survivor benefits, and in some cases worker's compensation benefits should your partner pass away.
Learn more about the transition into combining your finances by visiting the nearest Columbia Bank branch. You can also contact a customer service representative with any questions you might have: (800) 522-4167, Monday-Friday 7:00 a.m.-9:00 p.m. (EST) and Saturday 8:00 a.m.-4:00 p.m. (EST).
The Financial Impact of Raising Children
Bringing a child into your life changes everything, including your finances. Paying hospital bills, the cost of adding another person to your household, and saving for college are all daunting prospects. With proper preparation, however, they don't have to be. Here are some things to think about even before you start decorating the nursery:
- Prepare for medical bills. Even before delivery, the doctor visits start to stack up. Get a good idea of your insurance coverage as soon as possible. Most providers should be able to give you a close estimate of how costs will add up. Though it's difficult to think about, you may also want to set aside extra money should any complications arise before, during, or after the birth. And don't forget: having a child means another set of regular doctor's appointments, which will be especially frequent during those first months and into childhood.
- Account for maternity and paternity leave. You just don't know how you'll feel once the new baby comes, not to mention how much time mom (and dad!) will need to take off of work to settle into the new swing of things. Dad might want to rack up some extra vacation days or savings, and maternity leave is often unpaid.
- Daily life is about to be completely different and more expensive. Adding a child to your life means you'll start needing goods and services you've never needed before. From diapers and childcare, to braces and ballet lessons, random costs will grow just about as quickly as your youngster will grow out of her new clothes. In a 2010 USDA report, it was found that in the first year of a baby's life, an average middle-income family spent an extra $12,000, a number that will only increase. By age two, parents were spending more than $12,500 per year on child-related expenses.
- Start saving for college right away. The cost of a good education has never been higher. Start planning for this important investment as soon as you can with an education savings account from Columbia Bank. The best way to take care of your child is to set them up for future success.
Learn more about how to financially prepare for having children by visiting your local Columbia Bank branch. You can also contact a customer service representative with any questions you might have: (800) 522-4167, Monday-Friday 7:00 a.m.-9:00 p.m. (EST) and Saturday 8:00 a.m.-4:00 p.m. (EST).
Starting A Business
Starting a business is a huge undertaking. There are thousands of things to consider before taking the leap, many of which come into play long before you're ready to apply for a loan. We've gathered a list of five essentials to keep you on the track to success.
Choose the right kind of business for you. This may seem obvious, but you would be surprised how many people don't take this into consideration. If you want to start a business, make sure it encompasses something you truly care about. That way, when the going gets tough, you can remind yourself why you started on this road in the first place. It's also important to think about how you and other members of your team operate as individuals. Choose a path that makes sense for you, something you can and want to continue doing for years, maybe even the rest of your life.
Write a watertight business plan. This is essential to being granted a loan. Be thorough - make financial projections, as well as cash flow, profit, and loss estimates. Be creative, but direct in your approach. Sell yourself, but try to be realistic and honest. Learn how to present your business's story when applying for loans. When you appear prepared and passionate, you're much more likely to get a favorable response.
Establish credit. When being considered for a new business loan, it's important that you have strong credit scores - both business and personal. If you have bad or no credit, start working to establish credit immediately. This is a good idea for anyone, but for potential business owners, it's nonnegotiable. It's also a good idea to gather both business and personal financial statements; this documentation is often required with your loan application, some even ask for years of information.
Know what you need. Before applying for a loan, familiarize yourself with the options. When you meet with a lender, you'll want to have a very clear idea of how much capital you'll need and what kind of loan you feel comfortable taking. Research interest rates and terms for several different types of loans before settling on the loan for you, then make an outline of how exactly the loan will be used.
Small businesses and small banks go well together. You've come to the right place for a new business loan. Large banks can be reluctant to give smaller business loans, but here at Columbia Bank, we know every great business has to start somewhere. We'll be by your side every step of the way.
When you feel you are ready to apply for a new business loan, consult this helpful checklist from the Small Business Administration. You can also visit your nearest Columbia Bank branch or contact a customer service representative with any questions you might have: (800) 522-4167, Monday-Friday 7:00 a.m.-9:00 p.m. (EST) and Saturday 8:00 a.m.-4:00 p.m. (EST).