Author Archives: ISBTC Blogger

4 Steps to Buying a Home That Won’t Bust Your Budget

It’s that time of year when you’re likely to see ‘for sale’ signs on every block. Maybe you already have your eye on one and go out of your way to drive past it on your way home from work. Before you leap into purchasing a home, be sure to take these four steps before signing the bottom line.

1. Understand Your Monthly Expenses

Alarmingly, many Americans don’t have a true understanding about what money they have coming out each month. This can be a dangerous territory to get into, as it’s likely that there are a significant portion of the expenses that may be unnecessary. Take the time to have an understanding of what each of your monthly expenses are and if any can be cut or lessened. Maybe there’s a subscription you’ve forgotten about or haven’t realized how much money you are putting towards name-brand groceries each month.

2. Know What You Can Afford

Once you have your expenses broken down, you will have more of an idea of what you have coming out. Next, you should understand what you have coming in. Account for each person’s income contribution for the home. Subtract your monthly expenses from the after-tax amount and you will have an idea of what you can afford. You may want to consider meeting with a mortgage specialist to have a robust account of what homes could be in your price range.

3. Understand Home Buying Expenses

Being a homeowner comes with many responsibilities that sometimes can’t be accounted for. From broken pipes or a leak to a busted HVAC, the costs can be overwhelming at a moment’s notice. It’s important to understand the expenses that may come out of home ownership. Even if there isn’t something breaking, you have the responsibility of additional upkeep.

4. Set a Goal

Once you have a complete understanding of where you are and where you might be, you can set a goal. If the house you want is out of your price range, make it a goal to be able to afford a home like this. Take a look at what expenses can be cut in addition to how you can make additional income to get you to your goal within a reasonable time frame.

Don’t strap yourself into a payment that won’t fit your lifestyle. Allow us to help you purchase your dream home with a mortgage from Iowa State Bank!

Five Secret Ways to Raise Your Credit Score

Raising your credit score can seem like a daunting task, or you may not really care what your score is. However, a credit score affects more than you may realize, which is why we find it important to share our knowledge. Develop consistently strong credit habits with these secret keys of advice from Iowa State Bank.

1. Show you can handle all types of debt.
Debt comes in all different forms, from car loans and mortgages to credit card bills. Instead of paying for an item in full, consider putting that purchase on your credit card and paying in increments. When it’s time to get that new car you’ve been eyeing, add those payments to your list of different types of debt. Each time you create a new loan and pay off your purchases, you’ll see a bump in your score. Be wary of getting too big of a loan or making multiple purchases on your card – be realistic on what payments you can make each month to avoid accumulating too much debt.

2. Make payments on time.
If you decide to open a new account to show your good money habits, be sure to create a schedule for yourself. Don’t forget a payment, even if it just happens here and there. Every time you don’t pay on time, you’re instantly hurting your credit score.

3. Utilize your credit cards to the fullest.
Keep in mind that some of your credit is based on how long you’ve had a credit card. If you finally pay off that debt on your oldest card and decide to close it so you don’t spend anymore, this could actually hurt your credit. Once you pay off your debt, keep your card activated – this will allow your credit to continue to grow! We offer credit and debit cards that can help you work on bettering your credit.

4. Pay off the lowest-balance card first.
If you’re dealing with a lot of debt and feel overwhelmed, come up with a system to help lessen the stress. Find out what card you owe the least on and work to pay off that first, while making your minimum payments on all other cards. While snowballing your money and paying off the highest amount of debt first has been recommended, it may be wise to flip that idea around. You’ll need the boost of energy you get from paying the lowest amount of debt off to keep on track. Knocking your debt out this way won’t hurt you, as long as you continue making your minimum payments.

5. Ask for a credit limit increase.
If you regularly make payments on your card by following rule number two, feel free to ask the credit card company for a credit limit increase. By getting an increased limit and not spending more than you usually do on your card each month, this translates into a better credit score.

We hope you put these simple tips to good use. As your credit score continues to climb over time, you’ll be able to apply for larger loans. Working on strengthening your credit score will lead to other good financial habits. If you’re looking for a credit card, search no more – we have what you’re looking for!

5 Best-Kept Secrets for Buying a Home

Buying a home may be a common practice for the average American, but it is not a simple one. This is especially true if you are new to the game and have yet to learn the ins and outs of the process. No need to worry, we have plenty of experience from our years in the home buying business and are willing to share the best-kept secrets on the market!

1. Start Today

If buying a new home seems far into your future, that means you are in the perfect position to prepare. Often, many have dreams of a new home but don’t start planning practically for how to get there. Maybe you haven’t bought that new home yet because you’re not financially ready for the investment. However, that doesn’t mean you don’t have a way to prepare. With a home purchase, you will have closing costs and a down payment. Start saving for this now! Imagine how much quicker you can get not only to your goal of home ownership, but having the ability to purchase the home you want without the down payment and closing costs being an inhibition. Additionally, the more you’re able to put down up front, the less your monthly payment will be!

2. Don’t Go Big

The saying, “go big or go home,” doesn’t apply to the purchase of your home. The big, shiny house on the block may catch your eye, but may not be the house for you. Often, people see a big home and instinctively want it to be their own. Yet, this may not always be the best choice. Large homes can be difficult to resell, as the market for them is different. Not to mention, you’ll have additional utility and upkeep costs that come with increased square footage. You have a greater chance of profiting off of a smaller home when it comes time to sell than a large one.

3. Go Shopping

For the open houses that you see as you drive around town – go to them! Become familiar with a variety of homes and their details. What are they pricing homes at in the neighborhood? What is the structure like? Ask as many questions as you can, and expose yourself to a home you may have not considered before. You may be surprised by what you like!

4. The Secret Bid

Know your limits and stick to them. There are many that buy more house than they can truly afford. This is why it’s important to not fall in love with the home until everything is signed. Meet with an inspector and make a fair offer, but realize that this is likely not going to be accepted in round one. At the same time, it’s important to not automatically shoot too low, as it may offend the seller which can set a rigid precedent for any future bids. Do your research on the property and the neighborhood before deciding on the first bid.

5. Negotiate, Negotiate, Negotiate

This is where the communication gets tricky and scares the newbies. Haggling might not be a common practice in our culture, but this is the time to be bold. Don’t hesitate on going back and forth on an offer. This is a normal process and it makes you a smart buyer.

When looking to buy a home, Iowa State Bank offers options suitable for your financial needs. Contact us today for more info.

4 Ways to Save On Big Purchases

Are you known to be “tight” with your money? Do your friends and family ever make jokes about your thrifty ways? Consider this a compliment! But what do you do when it comes time to replace a big ticket item or something beyond your spending limit catches your eye? You save! Here are some great ways to save on big purchases!

1. Know The Actual Costs

Have you ever made a large purchase, only to find out that you also need to spend extra money on accessories, hidden fees and installation costs? Before you can plan out your savings, be sure to do all of your research. For example, if you would like to buy a large TV, be sure you calculate the cost of the cords, additional streaming services or media players you want to use. All of this should be factored into your budget before you swipe the plastic.

2. Know Your Deadline

When would you like for this item to be yours? Maybe you’re saving for a refrigerator, as your current one is going bad. Do you have an estimate of how long it will last? Make your deadline a little earlier than this so you’re prepared. Divide how many weeks until the deadline by the total cost of the item. Does this amount seem doable? If not, see if there are any other areas in your budget you can carve out in the short term to make this happen.

3. Know Your Expenses

Cars breakdown and life happens. Before you spend money on that big-ticket item, be sure to have an emergency savings account in place. Open a free Kasasa Saver® account to help you build your emergency fund. If you don’t have a budget, start one. Be sure that all of your basic needs are well covered before buying.

4. Know Your Worth

If you want to speed the process along, know your worth. What we mean, is that you can look into making some extra money on the side by selling your skills! If you’re a talented writer, look into freelanced work. If you have a knack for fixing cars, sell your services. These are simple and don’t have to be time-consuming money earners. Get paid well for your hobby work!

When you start saving on your big purchases, open a savings account with us today so you can safely store that cash!

7 House Buying Tips to Save Money

It’s finally house hunting season and you could not be more excited to get the ball rolling on your big purchase! Before you hit the road or the search bar, take these 7 tips into consideration.

1. Know Your Limits

Before signing the papers or falling in love with the first home you see be realistic about what is in your budget. We recommend spending no more than 25 percent of your monthly income on the mortgage. When you know what this number is, be sure to stick with homes in that price range. Don’t even go into homes that are going to be proportionately out of that limit, or you may kick yourself later as you feel straddled with a home you can’t afford.

2. Be Realistic About Fixer Uppers

While they are fun to watch on TV, if you don’t have the skillset to actually fix homes, a house that needs a lot of TLC is likely not for you. Many see a low price on a home and jump on it, thinking the work needed will be minimal and easy. When it comes to home improvement, no fix is simple and this is even more true if you are a newbie to the renovation game. Often people do not realize the time commitment and additional cost that come with dramatic improvements.

3. Provide a Strong Down Payment

The more you are able to give for a down payment, the greater equity you will already have in the home in addition to a lower monthly payment. This will save you money on interest in the long run.

4. De-clutter the Current Space

It’s time to spring clean your “extras.” We all have things sitting around our home that go untouched and unneeded. Start selling these items at a local thrift store or posting them for sale online. This will help to make your move easier and be a helpful way to start saving for the down payment!

5. Take Your Time When Shopping

Don’t let the desire to get out of your current living space cloud the judgement of the purchase. Take your time studying each home and realize that this is one of the most important big purchases you will make in your lifetime. It needs to be a thoughtful, decisive purchase.

6. Eliminate Other Debts

Get a great deal on the mortgage by making sure your credit score is in tip-top shape. A large purchase with a loan or credit card right before you buy a home will certainly have an impact on your mortgage rate. Boost your credit score by paying down the debt you have and stay away from any other purchases until after the home is in your possession.

7. Conduct a Personal Roof to Basement Inspection

Know the property backwards and forwards before signing the dotted line. This means hiring a trusted inspector and having a contractor come to confirm the findings. After this, there is still a final step. You need to conduct a thorough inspection to ensure that you know exactly what you are in for. This is a great checks and balances system to confirm that you are getting a fair deal that won’t end up costing you thousands in repairs later.

Be smart with your finances and don’t spend all your money on a “dream home.” We’re here to help you know how much house you can afford, while offering mortgage solutions to fit your needs.

8 Energy-Saving Tips for Spring

It was a cold winter and it isn’t quite the scorching days of summer. It’s a beloved time of year for many. But did you realize that you may be spending more than necessary on energy bills this season? Here are eight tried and true ways to save this spring!

1. Say Hello to Your Adoring Fans

Ceiling fans are the coolest way to get your home to a comfortable temperature. If you have fans that are energy efficient, they can potentially cut your costs by as much as 60 percent! Did you know that you should be changing the direction of your ceiling fan for the warm and cold months? Here’s a short how-to video.

2. Hello Sunshine

Get the windows open! Not only is it a great mood booster, but it can provide significant savings. Lighting costs can add up quickly, so take advantage of the natural light right outside of your window. Thankfully, the days are getting longer so you will be able to do this later and later into the evening as the season progresses.

3. A Grill is Swell

Who doesn’t love freshly grilled food? Even the smell of your neighbor grilling can get your mouth watering! A great additional perk of grilling is the cost it can save of having the oven or stove top on. If you’re cooking a meal in the kitchen, it can quickly heat up the whole house, thereby causing the air conditioning to run even more.

4. Seal the Deal

Do you remember the draft you felt coming from the window this year? It’s time to get that sealed. One-third of your energy costs may be going right towards paying for those leaks as cool air escapes in the spring and summer.

5. Suck It Up

In addition to spring cleaning the house, grab the vacuum and get behind your fridge. You may want some assistance to move it out from the wall. If you see that the back is starting to collect dust and debris, getting it cleaned off will help it to run more efficiently.

6. Filters: Forget Me Not

If you haven’t been regularly replacing your air filters, it’s time to do so. This will help it to run efficiently while providing clean air to your lungs.

7. Treat Your Windows Nicely

Window treatments can do wonders to cut costs on the electric bill in all seasons. You can get blinds or curtains. We would recommend thick light-blocking curtains that do a great job of keeping the temperature to your preference on the really warm days.

8. Shorten Spring Showers

Leave the long showers to mother nature. Your water bill can add up quickly, so start challenging yourself to no more than a five-minute shower. One way to make sure you stick to this time is by setting an alarm and placing it in the far corner of the bathroom opposite the shower. Nobody wants to hear that loud beeping while taking a shower!

When you start saving on your energy bills, open a savings account with us today so you can safely store that cash!

Budgeting Basics: How to Save on Inconsistent Income

While budgeting for a fluctuating income can be difficult, Iowa State Bank is here to help offer a few strategies to lessen the madness. Finding a process to help soften the blow of the months where revenue drops is a perfect solution. Check out the following rules you should follow when living on an inconsistent income.

Know Your Baseline

Always having an idea of your lowest point for income will help you prepare for the months where fewer dollars come through the door. You’ll also need to know your bare-bones budget, as in how much money do you need that month to make it through – like groceries, utilities, rent, childcare and so on. By knowing the minimum amount of money you need, you’ll be able to compare that to the minimum amount of money you’d potentially make that month. This will help you know what costs to cut, so you can break even!

Build Your Rainy Day Fund

Your emergency fund is there for times like this. If your income is fluctuating, you will need to prepare for the unexpected. The general rule of thumb for your rainy day fund is to accumulate three to six months of living expenses. Work on building up to the six months, and then add a little more for a buffer, in case your income is lower for a longer period of time than expected. This will save you from having to dip into a savings account if a large expense comes your way. You can also utilize our free Kasasa Saver®, as it links to your free Kasasa Cash® or Kasasa Cash Back® checking to help you save every month.

Give Yourself A Grace Period

It takes time to get into the budgeting rhythm, so don’t give up the first month if you don’t hit your goals. Keep your eyes on the prize and learn from your budgeting mistakes. If your income is unpredictable, it doesn’t mean your budget has to be. Utilize apps on your phone or make an old school spreadsheet – whatever works best for you! These tools will help you keep track of expenses, so you can stay on target as the months pass.

Spend Based Off Your Lowest Paycheck

When your income fluctuates from paycheck to paycheck, depending on how many sources of income you have, try basing your budget on your lowest paycheck. This will help you learn to keep your expenses low, while offering extra cash to pay off debt or add to your emergency fund.

We hope these budgeting basics help you continue to save and stay financially sturdy with an income that rises and falls. If you’re looking for a safe place to keep your savings, we have a savings account option for you! Iowa State Bank also offers different solutions to grow your money, so feel free to discover more about the benefits of banking with us.

Money Management for College Students

If you’re fortunate, your parents may have taught you how to save your allowance or a certain percentage of each paycheck. However, if those skills weren’t taught to you or you just plain didn’t listen, we are here to help you at the beginning of your financial journey as an adult! Stay tuned for some simple tips you can start doing now to strengthen your current and future financial habits.

1. Create a Budget

Most adults who have been managing their money for years have yet to figure out how to stick to a budget. You now have the opportunity to stay ahead of the curve by building the right habits now. Most people are under the false assumption that they have to have a lot of money in order to budget. This is not true, as no matter how much money you do or don’t have, everyone should have a budget. This will help you to control your spending and saving.

You first need to decide what amount you want to put into savings every month. Next, determine how much money you need to spend on rent, food and other bills. You can make as many categories as you like. You especially need to have a category for fun. Use it as you please, but when it is gone, it’s gone. You are making a promise to yourself that your financial security is more important than a splurge.

2. Buy Used, Not New

Unfortunately, the cost of new textbooks is astronomical. As a college student, it is most often going to be wiser to buy used than new. With a used textbook, you will pay significantly less and may even be lucky to see the former owner’s notes. Think about what other purchases you need to make and if it would be better to buy them used. The answer will often be yes.

3. Be Smart With Your Credit

It is a great idea to start building up your credit history. However, if you aren’t paying off what is due at the end of every month, a credit card may not be the right choice for you. Deep credit card debt burdens many because they made purchases that they could simply not afford. Be sure to use the card for needed items and not sudden splurges.

4. Take Advantage of Free Entertainment

One great part of being a college student is all of the free activities that your campus has to offer! There’s no reason you need to spend money going to a big movie theater when most college campuses have their own movie showings free for students every weekend. Check out your campus Student Activities Board to see what free fun you can get in on!

5. Use Cash
This is a great rule for anyone, not only college students. However, we believe it is a helpful habit to start now. If you have a problem with impulse purchases, we recommend using the “fun money” portion of your budget as cash only.

If you go out to have fun with friends for the night, you know the exact amount of money you have to spend. No more, no less. For some reason, it is much harder to spend cash than it is to make a purchase on a card. This will help you to control your spending when you’re having fun.

We have plenty of savings options available for college students looking to grow their funds! Take a look to see what option suits your needs best.

5 Creative Ways to Save for Your New Home

You’ve made the decision that you are tired of renting and ready to step into the world of home ownership. Good for you! You may be wondering what your next steps should be in order to be financially prepared for this major investment. Here are some creative ways to ramp up your savings for this exciting adventure!

1. Consider a Move Now

Is the place you’re living now truly the most cost effective for your budget? Consider moving to a temporary location that can significantly trim your monthly expenses. This is especially helpful if your home purchase is far into the future. No, it might not be the nicest place you’ve ever lived in, but imagine your dream home even closer on the horizon because of the sacrifices you are making right now. Place all of the added savings directly into your savings account.

2. Show Up for Your Budget

Many people begin the new year with excitement about all of the ways they are going to change their purchasing habits in order to achieve their big financial goals. However, like most resolutions, they are abandoned within the first few months. This is the time for you to show up for yourself, your goals and your budget. How? By continually reviewing how you are meeting or faltering your savings goal on a weekly basis. This will keep the financial goal of buying your first home at the forefront of your mind.

3. Purge and Sell Your Belongings

This is a great way to prepare for the big move in more ways than one. Like many adults, we have plenty of items that we don’t need or use gathering dust in our closet. It’s time to part ways and sell them at a garage sale or post them online. Put the profits directly into saving for the down payment that will likely be a minimum of 3.5 percent.

4. Look for a Side Gig

Every little bit counts! If you even have ten hours a week extra that you could commit towards another job, it can be a big boost to your savings. Whether it’s freelance work in an area you are experienced in or applying to be a server at a local restaurant, this is a great way to see your savings climb.

5. Automate Savings

Although this isn’t exactly creative, we would be remiss to not include this incredibly important part of any savings plan. For every amount of money you take in, automate a percentage of that towards your savings account to take any of the temptations of spending out of the mix.

Open a savings account today to begin to build the funds you need for your dream home.

7 Ways To Save On Your Energy Bill

With winter at full force, heating bills will begin to skyrocket. The typical family spends an average of $2,200 per year on utilities, according to the Energy Department. To cut costs and crush your saving goals, Iowa State Bank of Fairfield offers some simple ways to save on your energy bill.

Wash Clothes On Cold

About 90% of the energy the washing machine uses goes towards heating the water. Not only will your clothes still get clean when washing them in cold water, but they’ll have less shrinkage and fade. If you wash 4 out of 5 loads of your laundry in cold water, you could cut out 864 pounds of CO2 emissions in a year. That’s equivalent to planting .37 acres of U.S. forest. This is because the cost of the hot/warm rinse setting for a load is $0.68 while cold/cold is only $0.04 – which also means less electrical output.

Update the Showerhead

An energy efficient showerhead can reduce your water usage by 2,700 gallons per year – just look for one with the WaterSense label. This means the showerhead is certified to meet efficiency criteria set by the Environmental Protection Agency.

Seal Up Your Home

Plastic to cover your windows and weather stripping around doors will cause fewer drafts and leaks, keeping your home from working too hard to stay warm. According to Lowe’s, an insulating window film can help retain up to 55 percent of your home’s heat in the winter, so it’s worth a shot to help you save!

Change the Thermostat

When away from home or asleep under your warm covers, knock your thermostat back 10 degrees. That seems cold, but it’ll help you save as you don’t need the warmth during those times. Doing so for eight hours can lower your annual heating and cooling costs by around 10 percent. You can also invest in a programmable thermostat, which will do the work for you.

Adjust Your Fridge and Freezer

Your food will still stay fresh with this tip! Set your fridge to 38 degrees and your freezer to 5 degrees to save BIG.

Turn Down the Hot Water

Lower your water heater temperature to 120 degrees. This can help reduce heating costs by 10 percent!

Switch to CFL Bulbs

Switching to compact fluorescent or LED bulbs that bear the Energy Star label, will help save you more than you think. CFLs use about 75 percent less energy and last up to 10 times longer than incandescent bulbs. This can save you up to $35 in electric costs over the lifetime of each bulb.

We hope you implement a few of these strategies to allow your money to stay in your pocket. If you’re looking for a safe home to keep your funds, our savings account options are the perfect place! Learn more about all the financial benefits our banking solutions have to offer you – then contact us for more information. Stay warm!