Another year has ended, and we now look forward to 2023. Over the past two years, we have experienced some amazing changes. In 2020, we entered a worldwide pandemic that greatly impacted our workforce and supply chain. The Federal government responded by injecting literally trillions of dollars into the U.S. economy to help provide families and businesses the funding to weather the impact of the economic slowdown. Although some help was needed, it soon became clear that the impact of the pandemic and the resulting stimulus caused our workforce to fall to a point that there are now more jobs available than people to fill them. This caused the supply chain problems to accelerate to the point that demand (funded by stimulus dollars) significantly outpaced supply. This, in turn, has caused the rate of inflation to reach levels last seen in the 1980’s. The Federal Reserve is keenly aware of this situation and will continue to tighten their policy stance until the economy ultimately moves into a recession. We are beginning to see the impact of rate hikes as home sales have slowed nationwide and leading economic indicators are confirming the beginning of a slowdown.
I continue to be amazed by the resilience of the Rock Springs region over the years. There was a time when we experienced significant boom and bust cycles. This still happens to some extent, but as the region has grown over the past 10-years, the diversification of the area has provided more stability. As a community bank, we remain focused on serving all the residents and businesses in the trade area. At a time when many of the major banks are letting politics get in the way of serving all the needs in the area, we remain steadfast in our commitment to support every business regardless of industry. Energy production has been a mainstay in this region, and will be for years to come. We are committed to being a part of that ongoing growth.
In closing, I want to say again how thankful I am for everyone who has contributed to our growth over the years. I also want you to know that we will continue to maintain the values that got us to this point. Providing great personal service and appreciating every customer who comes through our doors will always be our priority.
If you have any questions or concerns, please feel free to contact me at any time.
How to Pick the Best Savings Option for You
You know it’s wise to save for the future, but how do you know where to put your money? (Not under your mattress, obviously.)
First, let’s consider the options:
Savings Account: This is the simplest option. It’s a safe place to hold money you don’t plan to spend right away but want easy access to. You can make withdrawals and deposits, and you’ll earn a variable interest rate, though it’s lower than other savings options.
Money Market Account (MMA): This account pays a slightly higher variable interest rate than a savings account, and you can still make withdrawals and deposits, giving you easy access if needed. However, there’s usually a higher minimum initial deposit amount required to earn a higher interest rate than a savings account.
Certificate of Deposit (CD): A CD offers a fixed interest rate that is usually higher than that of a savings account or MMA. The difference is you pick a term you are willing to hold the funds in for and you will earn a fixed rate for the specific term you select. Typically the rate is higher the longer you’re willing to leave your money in the account for – but if you make a withdrawal prior to the maturity date, you’ll pay a penalty. Some savers consider this a benefit, however, because it helps them avoid the temptation to spend their savings earlier than planned.
Investment Account: This is a riskier – but potentially a higher-earning – account. It allows you to buy and sell stocks, bonds and mutual funds. While the other savings options are FDIC insured, investment accounts provide no protection against a loss in value. There are two main types of investment accounts: retirement and brokerage. With a brokerage account, you pay capital gains taxes when you sell an investment for a gain, unlike an Individual Retirement Account (IRA), which offers tax advantages. However, a retirement account comes with limits on contributions and on when you can withdraw funds. Another investment account option to consider is the 529 college savings plan if you’re saving for a child or grandchild; this account also offers tax advantages but comes with some restrictions on use.
Next, let’s look at how to pick the best option for you:
- Decide the purpose of your savings. For example, is the money saved for a down payment on a house within the next five years, for retirement decades from now or for a child’s college tuition?
- Consider interest rates. You’ll receive a higher interest rate if you’re OK with restrictions on usage or you’re not adverse to risk.
- Check for fees. There may be a fee for letting your balance fall below the minimum or for withdrawing your money too soon.
- Determine when you’ll need the money. Do you need easy access to it, or can you leave the money untouched for months or years to achieve a higher interest rate?
- Assess your risk tolerance. Remember that you can lose money with an investment account, but the risk may be worthwhile to gain a higher interest rate.
- Whichever account you choose – or likely a mix – we’re here for you with knowledgeable representatives, superb customer service, competitive rates and low fees. Take the first step toward a brighter financial future by opening an account or contacting us with questions!
Sources: https://www.businessinsider.com/personal-finance/how-to-choose-a-savings-account, https://www.forbes.com/advisor/banking/what-is-a-savings-account/, https://www.investopedia.com/terms/m/moneymarketaccount.asp, https://www.investopedia.com/terms/c/certificateofdeposit.asp, https://www.forbes.com/advisor/investing/what-is-a-brokerage-account/.
WE'RE ONE OF THE BEST BANKS TO WORK FOR IN 2022
For the fourth year in a row, we have been listed as one of the Best Banks to Work For in 2022. American Banker and Best Companies Group recognizes and honors banks in the U.S. for outstanding employee satisfaction. Read more…
IRAs – They’re Not Just for Tax Time
Contrary to what many people think, an Individual Retirement Account can be opened or contributed to at any time during the year, not just at tax time. A Traditional or Roth IRA can be funded any time during the year and up until the April tax deadline of the following year, and the Traditional IRA can still be deducted from the income taxes of eligible investors. However, the earlier in the year an IRA is opened, the greater the long-term accumulation potential.
Changing jobs or retiring?
Get the peace of mind you’re looking for and consider rolling over your 401(k) to a NebraskaLand Bank IRA where it’s safe and secure. Rolling over your 401(k) or other qualified retirement plan from your previous employer gives you more flexibility and control while keeping all the great tax advantages.
To decide whether a Roth or Traditional IRA is right for you, please contact one of our personal bankers today!