As we move through January, we’ve been reflecting on the enduring values championed by Martin Luther King Jr.
His commitment to equality and justice echoes in our aspirations for a fair and inclusive access to homeownership, as well as a positive and successful homebuying experience.
We have several newer programs we’ve launched to help give more people ways to buy homes – if you’re looking for the latest and greatest (or know someone who is), connect with a local loan advisor who can review all of the opportunities we have available in your area.
In line with Dr. King’s vision, we strive to ensure every individual has equal access to the benefits of homeownership.
REACH YOUR GOALS
Financial Wellness Resolutions
Whether or not you made any New Year’s resolutions for 2024, you may want to work your way through this financial to-do list. No diet or exercise is required, and you only have to take a few steps to improve your financial health and security.
Change your passwords. Data breaches continue to make the news, and hackers never sleep. Here are some strategies to keep your personal data safe:
- Use a different password for each account.
- Use longer, complex passwords with at least 12 characters.
- Consider using a password generator like McAfee’s – it’s free.
Protect important documents. Ensuring that you have both digital and physical copies of your most valuable documents ensures that you’ll always have an accessible copy. This is especially important in case of a disaster, as you’ll need one or more of these for an insurance claim. Physical/paper copies can go into a fireproof safe or bank safe deposit box. Electronic/scanned copies should be password-protected and stored on an external hard drive or flash drive. This drive can also go into your fireproof safe or deposit box.
Review your W-4 holdings. While you can change your withholding for any reason, you’ll need to review yours if any of the following have happened recently:
- Your household income has changed.
- You and/or your spouse went through a period of unemployment.
- Your family has grown, or a grown child has departed the home.
While it can be difficult to estimate the results of a changed W-4, you will probably want to err on the side of caution, going for a possible refund instead of an unplanned tax bill.
Sliding Mortgage Rates Encourage Builders
If you’re a would-be homebuyer frustrated by 2023’s lack of homes for sale and rising rates, the new year may offer you the two things you’ve been waiting for: more home choices and more affordable financing. Homebuilders are currently fast-tracking production after watching mortgage rates head south during the last months of 2023.
Builders broke ground on single-family homes last November at an annual rate of about 1.14 million units. That’s an 18% jump from October 2023 — the same month that mortgage rates hit an ouchy 8.45%. If mortgage rates continue to fall, this may encourage builders to bump up production during the first months of 2024.
Since some homeowners who snagged low interest rates during 2020 and 2021 are reluctant to sell, an increase in new construction may encourage buyers to visit model homes in new subdivisions. The National Association of Home Builders (NAHB) is projecting a roughly 4% increase in single-family starts next year as “mortgage rates settle lower, economic growth slows and inflation moves lower,” according to chief economist Robert Dietz.
Is There a Goldilocks Economy in Our Future?
Our economy has been called all sorts of things for the past three years as it’s delivered plenty of surprises. If you’re feeling financially nauseous because of a rollercoaster ride that included red-hot inflation, you may be hoping for a soft landing. But some economists are feeling so optimistic that they’ve gone a step further, predicting a Goldilocks economy that’s “just right” to arrive this year.
If you’re not familiar with the children’s tale of Goldilocks and the Three Bears, it’s about a girl named Goldilocks who visits a family of bears’ home while they’re out. She ends up tasting their breakfast oatmeal. While one bowl is too hot and another’s too cold, she proclaims the third bowl of oatmeal “just right” and helps herself to it. (Perhaps the bears have installed a Ring doorbell since then, but that remains to be seen.)
Here are the reasons why we may experience more than a soft landing this year.
1. One factor is consumer spending, which many see as a driver to keep our economy growing.
2. Others watching the bond market are expecting a drop in interest rates, which could help fuel the real estate market.
3. Another factor: whether inflation will continue to wane this year without causing an economic slowdown.
Opponents of the Goldilocks landing have taken a more bearish outlook (pardon the pun). Instead of predicting a robust economy fueled by consumer spending, they expect a slowdown caused by the high levels of inflation-fueled consumer debt. Not only did interest rates for credit accounts rise; expensive prices for groceries and fuel resulted in more consumers charging items than in previous years.
DID YOU KNOW?
Think Twice Before Scanning That QR Code
Scanning a QR code can be a convenient shortcut to a variety of tasks, from checking out restaurant menus to logging into a streaming service. But a scam QR code can result in identity theft, so consider its source before you scan.
Quick-response, or QR codes store web links and other information in a format that’s readable by smartphone cameras. Retailers use QR codes to record consumer behavior, such as linking a code to a loyalty program. However, they can also be used to steal personal information.
Here’s how a QR code can be part of an identity theft scheme.
Scammers put their own QR codes in areas where they’re commonly found, including parking meter stations, concert venues, flyers and subway stations. As part of their scheme, they might cover up QR codes from legitimate businesses. Other scammers send unsolicited QR codes via text message or email.
The QR code may include an urgent message. One common example: a package you weren’t expecting was undeliverable and you need to contact the delivery company asap. Scammers hope that you’ll visit the website within the QR code without suspecting fraud. This site may “infect” your phone or computer with malware, enabling the scammer to steal your personal and financial information. A skilled hacker can attempt to drain your bank account, use your credit cards, open new credit accounts and even use your insurance to pay for medical treatment.
More information about QR scams and how you can keep your information safe are at this site sponsored by the Federal Trade Commission (FTC).
Five Strategies For Your Next Windfall
If a year-end bonus or tax refund is headed to your bank account, deciding what to do with it may not be an easy decision. Here are five options that are recommended by financial planners.
1. Pay Off Debt. If you have balances on any credit cards, these should be first in line for your windfall. Inflation may have pushed your credit cards’ interest rates higher than you realize, especially if you have set up autopay and rarely review your monthly statements.
2. Bump up your emergency savings. Ideally, working adults should maintain a cash reserve that equals around three to six months’ worth of living expenses. If you’d rather reserve some of your windfall for other things, consider setting aside a smaller amount each month.
3. Boost your retirement fund. Putting cash into your 401(k) or retirement savings is always a smart move. For example, if you deposited a $3,000 bonus into an index fund with an average 7% annual return, the $3k would grow to over $24k in 30 years.
4. Invest in education. If you’re looking for ways to move up in your career, consider using your bonus to earn new skills and/or certifications. If you’re planning to send a child to college, consider a 529 College Savings Plan.
5. Reward yourself. There’s nothing wrong with treating yourself to a night out, a weekend trip or a visit to a favorite retailer. A bonus is a reward for your hard work, after all, so why not have some fun with it?
Chicken Pot Pie
The winter months are ideal for comfort food, such as this traditional Chicken Pot Pie with plenty of vegetables. It’s easy to make your own buttery pie crust at home, but you can buy a ready-made pie crust if you prefer.
REAL ESTATE TRENDS
Go Warm and Fuzzy with Pantone’s Color of the Year
If the last couple of years have been somewhat stressful, you can change your home’s atmosphere with the help of Pantone’s relaxing new Color of the Year: Peach Fuzz. It’s a soft, light orange hue that may remind you of orange sorbet. It’s also a big change from the 2023 Color of the Year, the dramatic red Viva Magenta.
Like previous years’ colors, Peach Fuzz can add a fresh look to your home as a main or accent shade.
The folks at the Pantone Color Institute describe Peach Fuzz as “a compassionate and nurturing soft peach shade conveying a heartfelt kindness.” The color was chosen as a response to a world that often seems rife with turmoil and represents the hope for a more caring and peaceful future. Another element is its tactile feel; its name introduces an additional sensory angle. It’s also versatile – you can soften the look of a living room, den or bedroom with it.
If you’re curious about Pantone’s Color of the Year selections, their research begins months ahead of its release. In addition to color-word association studies, Institute staff look at trending colors at major events. For example, peachy shades were worn at newsworthy events such as 2023’s Met Gala in New York.