Tuesday, April 25, 2017

5 Worst Things To Do With Your Tax Return (And What To Do Instead)

It's refund season! April 15th has come and gone, and many people are already receiving their tax refunds. If you're one of the lucky people who are getting a tax refund this year, what you do with your money now can impact your future situation. Don't make the mistake of wasting your refund! Our Lake of the Ozarks community bank is here to help by offering these money-smart alternatives to what might be your first impulses.


Mistake #1: 
Blowing Your Refund On A "Just For Fun" Purchase
Whether from your tax refund, a gift, or an inheritance, blowing a financial windfall on a single purchase is never a wise move. While the urge to treat yourself to a brand new TV might be tempting, chances are you don't really need a new one. Instead, consider using the money to make any repairs or home improvements you may have been procrastinating. Performing needed upkeep on your home helps maintain/boost its value, which builds valuable equity.

Mistake #2:
Repaying Debt That Will Build Right Back Up
Using tax refunds to pay down credit card debt is a popular option, and not necessarily a bad one. Your tax refund can be an excellent way to get out from underneath high-interest debt. If your debt will simply rack right back up, however, your efforts may be wasted. If you have a history of consistently building up credit card debt, you may want to use your refund to pay down other debts instead, such as car loans or your mortgage. As for the credit cards, you might be better off limiting your spending and paying your balance in full every month.

Mistake #3:
Letting Someone Borrow Your Cash
Loaning money to friends or family in times of need may seem like an honorable gesture, and indeed, it sometimes can be. Unfortunately, it often creates a great deal of unnecessary stress in once-close relationships. Many experts suggest making it a personal policy to refrain from loaning money to friends or family under any circumstances. To avoid getting pressured, try not to talk about your refund with anyone other than your spouse. If they don't know how much you got back, other people may be less likely to ask to share a piece of the pie.

Mistake #4:
Parking Your Refund In A Low (Or No) Return Account
Once your refund is in your possession, it has to go somewhere. If you choose not to spend or invest it, don't make the mistake of parking it in a checking or savings account that offers little to no interest. You could get a lot more "bang for your buck" by instead putting the money in a higher-interest account, such as the Kasasa Saver at First Bank of the Lake. Your money has to sit somewhere - it might as well earn you money in the process!

Mistake #5:
Not Thinking Long-Term
The moral of the story is simple: when it comes to your tax refund, the smartest thing you can do is strategize ways that you can use your extra influx of cash to put yourself ahead in the long run. Anything that focuses only on the immediate moment (such as spending it on a "just for fun" purchase or funding a last-minute vacation) wastes a valuable opportunity to improve your overall financial situation. Investing your refund in an individual retirement account (IRA) is an example of a particularly advantageous way to use your refund to put you ahead in the long-term.

First Bank Of The Lake Is Here To Help!
Whether you are looking for a high interest-bearing savings account at the Lake of the Ozarks or a place to set up an IRA in Osage Beach, First Bank of the Lake is your local resource. We offer a variety of different financial services to help you put your refund to good use. For more information, visit us online at www.FirstBankLake.com.

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065

(573) 348-2265

Wednesday, April 19, 2017

3 Lessons Every Financially Literate Person Must Learn

Financial literacy refers to having a good working grasp of fundamental financial concepts and being able to apply those concepts to real-life situations. People who are financially literate tend to make smart, educated decisions about how to handle their money, and as such typically lead successful, financially solvent lives. Unfortunately, statistics show that nearly half of Americans do not possess the knowledge or skills they need to be financially literate.


In order to raise awareness of this attribute, April has been designated Financial Literacy Month. In order to help others in their quest to become more financially literate, our Lake of the Ozarks community bank has is here to address three basic lessons that every financially literate person has mastered. By familiarizing yourself with these important lessons, you'll be one step closer towards being the financially savvy adult you deserve to be!

1. When It Comes To Loan-Shopping, You Have To Look At The Big Picture.

What sounds better: a $10,000 four-year amortizing loan with an interest rate of 3% or a six-year amortizing loan at 3.25%? At first blush, it seems that having a $153.06 monthly payment on a six-year loans sounds much better than a $221.34 monthly payment on the four-year loan. However, the total payments on the four-year loan is $10,624.43 as compared to $11,020.12 on the six year loan – meaning that you would pay $395.69 more in interest on the six-year loan (even though the monthly payments were more attractive). Financially literate people know that you can't judge a loan by its interest rate - you have to do the math in order to figure out which one will save you more money in the long run.

2. When The (Stock Market) Going Gets Tough, The Tough Keep Going.


You can't expect your investment process to always be smooth sailing. The market will dip and rise periodically. Financially literate people recognize that it's important to stay in the game even when the market looks bleak. Historic averages show that investments should continue to increase in overall value, even though they will experience minor dips here and there. By maintaining your investments even through the volatile periods, you will be in a position reap the rewards when the market rebounds.

3. When You Can't Afford A Purchase Out-Of-Pocket, Don't Make It.

Modern technology has granted us a lot of financial conveniences, such as the ability to transfer funds virtually from one account to another and view our account balances online. However, none are perhaps so potentially dangerous as the ability to spend money without even touching it - and in some cases, without even having it in the first place.

Credit card debt is quickly becoming the modern consumer crisis. Many people are quick to reach for the plastic when they're planning a purchase that they would not otherwise be able to afford. "I had to put it on my credit card - it was the only way I could pay it," is a common excuse. While credit cards do serve a purpose, it is important to recognize that putting a purchase on a credit card with the intent to pay it off later is essentially the same as taking out a loan in the exact amount you need to make a certain purchase. The only downside is, that particular "loan" could have an interest rate of 16-18% (or greater).

The moral of the story is: if you cannot afford to make a purchase without paying cash, you are better off avoiding the purchase altogether. If for some reason it is non-negotiable, consider taking out a personal loan at the Lake of the Ozarks. The interest rate you can secure from a local bank will likely be significantly lower than the interest rate you would be stuck with if you used your credit card.

Happy Financial Literacy Month!

There road to financial literacy is never-ending; there is always more to be learned in the world of personal finance. However, by embracing these three lessons, you will be well on your way to a more financially successful lifestyle. 

How can First Bank of the Lake help you on your way to a more financially successful you? Call 573-348-2265 or visit www.FirstBankLake.com to find out!

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065

(573) 348-2265

Thursday, April 13, 2017

Financial Lessons To Teach Your Kids (Part 2)

Whether they pick up information from you, their friends, their friends' parents, their teachers, or TV shows, your children are guaranteed to learn about money from somewhere. As the parent, it's important that you proactively teach your children how to handle money wisely so that they are less likely to learn bad habits from other sources. Last week, our Lake of the Ozarks community bank discussed four important financial lessons to teach your children:
  • "Money has to be earned."
  • "You may have to save up before you can buy."
  • "You have to use your money for different purposes."
  • "Once you spend money, you don't have it anymore."


Each of these are important lessons that, once learned, will help guide your children on their paths towards becoming financially solvent adults. However, they aren't the only lessons your children will need to learn. Keep reading to find a few more important lessons to teach your little ones, courtesy of your friends at First Bank of the Lake.

"Your Money Should Always Be Working For You."

The piggy bank may work well for the first few years of your child's life, but once she gets old enough to understand the concept of depositing money into a bank, switch her savings over to a local bank at the Lake of the Ozarks. It's never too soon to start teaching your child the importance of letting her money work for her by earning interest in a savings account. Help her keep track of her account balance and be sure to point out the interest that she earns in the account. If she internalizes this lesson now, she'll be more likely to invest her money when she is an adult.

"You Have To Be Selective About Your Purchases."

Children have to learn that money is not limitless. It's important to teach them how to count the money that they have, and then translate that amount into the purchases they can afford to make. For example, let us suppose that your son has $20 in his piggy bank. He can buy two toys that are both $10, but he cannot buy two toys that are both $15. It's important to help him see that when he buys the $15 toy, he will only have $5 leftover. He'll have to save up some more before he can afford the second $15 toy he has his eye on.

Helping your child think through his purchases in this manner will help introduce the concept of budgeting. This is a critical lesson for children to learn at a young age, before they have access to credit cards. Credit cards make it easy to spend money that you don't actually have, which can make it tempting to be less selective about purchases in the manner we just described. Instilling this lesson in your child at a young age will help him be less likely to rack up expensive credit card debt. 

"Take The Time To Find The Best Price."

If your child sees a toy at the department store she wants, take the opportunity to teach about bargain hunting. Explain that before she buys the toy here, it might be smart to look for the same toy at a different store or online, since she might be able to find it for a cheaper price somewhere else. If she is able to find it for a lower price, she'll have more money leftover to buy another toy in addition to that one. 

Grocery shopping is another great time to talk to your children about comparing costs. As they get older, you can begin to introduce the concept of calculating the actual cost of items that are sold in varying quantities. For example, a single granola bar priced at $1.00 costs more per bar than a box of ten granola bars priced at $9.00, even though $9 is greater than $1.

Open Your Child's Bank Account At First Bank Of The Lake!

If you are ready to introduce your child to the concept of banking, consider opening a checking or savings account with First Bank of the Lake. Our community-centered bank is here to put your and your family's needs first. For more information about opening a minor checking account at the Lake of the Ozarks, give us a call at 573-348-2265.

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065

(573) 348-2265

Thursday, April 6, 2017

Financial Lessons To Teach Your Kids (Part 1)

Being a parent is a big responsibility. As your children's guardian, protector, and number one role model, your actions are hugely influential in their lives. You will be impactful in all arenas of your children's lives, but for the purposes of this blog, our community bank at the Lake of the Ozarks is here to look specifically at the financial aspects of your children's lives. Here is a quick overview of some simple (but crucial) financial basics to teach your children.


"Money Has To Be Earned."

It's important that your children learn the value of money. The best way to do this is to offer financial rewards in exchange for the completion of household chores. (We recommend that you refrain from offering them an allowance that they receive weekly, regardless of whether or not they helped out around the house.) This will help them to grasp that their work is valuable, and so is their money. It will help instill a work ethic and help them to appreciate the money that they earn. When they receive money as gifts from family members for their birthday or holidays, they will be more likely to appreciate the value of the gift.

"You May Have To Save Up Before You Can Buy."

Delayed gratification is a tough lesson for many of us, but it's a crucial component of maintaining a proper spending/buying balance. Children must learn that they have to save enough money to make certain purchases. Help them count the money in their piggy bank, and then ask them if it's enough to pay for the $10 toy they have their eye on. If it is, great - it's time for a trip to the toy store. If it's not, tell them how they can earn the rest of the money they need to make their purchase (such as by helping with household chores).

"You Have To Use Your Money For Different Purposes."

Part of proper money management is learning how to allocate your funds for different uses. You can instill this concept in children beginning at a very young age. Instead of using a single piggy bank, consider giving your child three piggy banks and labeling them with specific categories: "saving," "spending," and "sharing." When they receive their allowance, encourage them to divide it evenly between these three categories. The "saving" bank can be used to save up for more expensive purchases, whereas the "spending" bank can be used for inexpensive treats. The "sharing" bank can be used to donate to a charity or buy birthday presents for their siblings, which will help instill a sense of generosity and teach the benefits of giving.

"Once You Spend Money, You Don't Have It Anymore."
In your children's eyes, it may seem like you have an infinite supply of money. It's important to teach them that every dollar you spend is a dollar you don't have anymore. Teach your children this lesson by encouraging them to make their own purchases. Have them take money out of their piggy bank, and let them be the ones to hand their money to the cashier in exchange for their purchase. Letting them be closely involved in this manner will likely be much more effective than trying to explain the concept verbally.

Check Back Next Week For More Tips!

These four lessons are important ways to begin to teach your children the value of money, but they aren't the only steps you can take. Next week, we'll offer a few more lessons to help you round out your children's financial foundation.

Remember: your children are guaranteed to learn about money from someone. By proactively teaching them smart money habits, you can help them avoid learning bad habits. 

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065


(573) 348-2265

Tuesday, March 28, 2017

Finding The Balance Within Your Budget

Just as it's important to balance your budget, you have to find the proper balance within your budget.

Balancing your budget means balancing your expenses and your income so that you don't spend more than you earn. Balancing within your budget means allocating your income so that you only spend certain amounts in certain categories. There's more to budgeting than paying bills. The true power of budgeting lies in determining how much you want to spend on certain things.


The 50-20-30 rule is a popular strategy that addresses the need for balancing within your budget. It helps you build a budget using three spending categories: necessities, savings, and wants. While there isn’t a one-size-fits-all approach to budgeting, these guidelines can be helpful to people in many different stages of life. If you’re considering using the 50-20-30 rule and want to learn more about it, First Bank of the Lake is here to help you determine if this is the right approach for you.

Let’s Take a Closer Look

To be successful at implementing the 50-20-30 rule, one must have a good understanding of what these categories mean.

‘Necessities’ can also be looked at as fixed costs. It includes rent or mortgage, public transportation or car payment, utilities, groceries and other living expenses. This category is pretty self-explanatory. These expenses are top priority because they are non-negotiable. Once they’re paid, you move on to ‘savings.’


‘Savings’ can be looked at as financial goals. It includes emergency fund savings, investments, and paying off debt such as credit cards or school loans, etc. You should make these contributions and payments after you pay your essential expenses, but before you do any other spending. It’s important to note this doesn’t include 401(k) or other retirement savings that are already taken out of your take-home paycheck. That’s a good thing because it’ll help boost your savings. Experts advise taking advantage of employer-offered retirement programs (especially if they match funds) because you don’t miss money you never see.

‘Wants’ can be looked at as personal or flexible spending. It includes the broadest range of expenses. This category is paid for solely with discretionary income and is the lowest priority on the budget totem pole. It is for things you want but don’t necessarily need, such as restaurants, movies, travel, cable, cell phone, internet, charitable or religious giving, gym membership, and anything else that isn’t 100% necessary for survival. Personal spending includes the most items because many things, such as internet or your cell phone, you can live without even if you don’t want to so they’re not technically ‘necessities.’ Keep in mind that if ‘wants’ are acquired using a credit card, the full balance should be paid each month. The fewer costs you have in this category, the more that can go to ‘savings’ at the end of the month and help you get ahead over time.

How to Start

To start applying the 50-20-30 rule, you need a thorough and accurate understanding of your monthly finances. Start by looking at your pay stub to know exactly what you bring home each month. Next, break down 50%, 20% and 30% to determine your total for each category. Track every cent you spend for an entire month, then divide it into the three categories. See where you stand on the 50-20-30 split and realize that you will probably need to do some adjusting. Be patient and give yourself a few months to get everything where it should be, but don’t give up. 

Why It Works

The 50-20-30 approach is simple, but it offers flexibility. You can bend the percentages each month to adjust your budget and make it work the best for you at any point in time. It’s extremely helpful because it outlines the order you should be spending your money. It’s key to remember that while no more than 50% of your take-home pay should go to ‘essentials’ and no more than 30% should go to ‘wants,’ no less than 20% should go to ‘savings.’ Any extra money you have each month can—and should—be used to boost your savings. 

The simplicity of this rule means that more people will stick with it over time, which will lead them to reaching their financial goals. It allows room for everything—you will pay your bills, add to your savings and still have money left over for fun. If you’re having trouble sticking with your budget, this could be a good approach to try.


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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065

(573) 348-2265

Tuesday, March 21, 2017

4 Financial Life Lessons That Should Be Obvious

Handling money wisely is often easier said than done. Talking about how your money should be allocated and how you should reign in your spending is one thing, but incorporating these tactics into your everyday life is often easier said than done. Sometimes, we need a little extra push to help steer us in the right direction.


First Bank of the Lake is here to help provide that extra push. Keep reading to find plain, no-nonsense explanations of pieces of financial wisdom that should be obvious, but many people have trouble incorporating into their daily lives.

1. Don't Spend More Than You Earn
You don't have to be a mathematician to figure this one out. The concept is simple: if you spend more than you earn, you won't be able to sustain yourself in long run. Ideally, you should bring in more money than you spend every single month. Life is unpredictable, though, and sometimes big expenses are unavoidable (health insurance premiums, new tires, etc). Spending more than you earn on any given month isn't necessarily a bad thing, as long as the scale tips back in the other direction by the end of the year.

2. Keep A Budget
Your budget is the most valuable piece of equipment in your financial toolbox. It allows you to keep track of exactly where your money goes, curb your spending in certain categories so that you don't overspend, and set yourself up for long-term financial success. There are a variety of budgeting strategies you can choose from. Ultimately, there is no "right" or "wrong" way to manage your budget - strategies range from extremely complex to extremely simple. All that matters is that you find a strategy that works for you and that you stick with it. 

3. Use Windfalls Wisely
Every so often, you may find yourself blessed with financial windfalls from various outside sources. You may get a bonus at work, you may inherit money from a deceased family member, or you may get a sizable tax refund. No matter where this extra money comes from, it's important to use it wisely. Most people use the extra cash to buy a new TV or other fun purchase, but we encourage you to use it to your advantage. Put it towards your highest-interest debt, your mortgage, or your retirement account. Allocating your windfall towards these types of purposes will pay off great dividends in the long run.

4. Plan For The Future
When it comes to managing your money, planning for the future is one of the most important steps you can take. No matter where you are currently at in life, it's important to look ahead. Your first step should be to build an emergency fund to cover unexpected expenses that may present. Your next step should be to set up a retirement account and begin contributing to it regularly, no matter how old you are. Retirement may seem incredibly far off while you're still in your twenties, but by beginning your retirement contributions now, you'll have lots of time for compound interest to work in your favor.

First Bank Of The Lake Can Help Set You Up For Financial Success
We can all use a little help from our friends every now and then. Our community bank at the Lake of the Ozarks is here to help you. Our new Kasasa services are designed to position you for long-term success. We offer high-interest savings accounts at the Lake of the Ozarks as well as cash back checking account options. For more information about our bank in Osage Beach MO, visit our website: www.FirstBankLake.com

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway
Suite 100
Osage Beach, MO 65065

(573) 348-2265

Wednesday, March 15, 2017

Good Debt vs Bad Debt: Understanding The Difference

Not all debts are created equal. Learn how to understand the difference.

Our culture tends to view debt as a horrible prospect that should be avoided at all costs. Statistics paint scary pictures of debt in modern America, stating that Americans collectively owe billions of dollars in credit card debt, mortgages, and other types of debts. So as to avoid becoming bogged down by debt's great burdens, some people swear off all types of debts so that they live financially solvent lives. However, some types of debts can actually be helpful. First Bank of the Lake is here to help you understand the difference.


Wait - There's Such Thing As "Good" Debt?

Yes, there is! A good debt is money that you choose to borrow as part of a well-informed, well-educated decision. Good debt helps to put you in a favorable situation that you would not otherwise be able achieve. By borrowing the money now, you are able to work towards a better situation in the long run.

Mortgage debt is a perfect example of good debt. Taking out a mortgage allows you to purchase a home that you would otherwise not be able to purchase. In addition to serving as a place to live, your home is a financial investment - when the time comes, you will ideally be able to sell your home for more than your original purchase price. Depending on how much your home's value appreciates and the health of the housing market at the time that you decide to sell, you may be able to turn a profit of several thousand dollars. 

What Makes A Debt "Bad"?

Unlike good debt, bad debt is debt that puts you behind in the long run. Steep interest and copious fees end up costing you far more than the original amount borrowed, without anything to show for it in the long run. 

Credit card debt is a common example of bad debt. Unlike a mortgage, credit card debt does not offer any long-term benefits. In fact, it offers just the opposite. Racking up credit card debt can significantly hurt your credit score, the high interest charged by credit card companies will ultimately cost you far more than the original amount borrowed.

How Can I Know Which Is Which?

It is important to be realistic and honest with yourself about what types of debt are helpful and which types are not. Before taking out a loan, ask yourself the following questions:
  • What long-term purpose will this debt serve? 
  • How much money will this end up costing me in the long run?
  • Will I be able to make this money back by selling my investment?

Asking these questions can help you identify the consequences taking out a debt will bring, and you can use this information to determine whether or not it will help you or hurt you in the long run.

First Bank Of The Lake - A Community Bank That Cares

At our community bank at the Lake of the Ozarks, we don't try to sell you a loan or service you don't need. Not only that, but we make all of our decisions right here at home, and we use judgment and compassion when evaluating customer requests. Visit our website for more information about our bank in Osage Beach MO.

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.


Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway
Suite 100
Osage Beach, MO 65065


(573) 348-2265