Money Matters

MONEY MATTERS

• Tips to protect your personal financial information

• 3 metrics that can help people gauge their financial health

• How to determine your financial needs in retirement

• Pitfalls that can lead to spending beyond your means

• How much home can I afford?

Tips to protect your personal financial information

Identity theft is a very real threat in the digital age. While it once was complicated for criminals to collect personal data, such as identification numbers, emails, phone numbers, and more, the connectivity the internet offers can sometimes make stealing information as easy as clicking a button.

In 2024, the Federal Trade Commission fielded more than 1.1 million reports of identity theft. Credit card fraud was the most common crime. Also, 2024 saw the largest data breaches in history, impacting billions of users and subjecting customers to the potential of having personal data exposed and ultimately exploited.

Although there is no foolproof way to keep personal and financial data safe, people can take several steps to safeguard their information.

• Use strong, unique passwords. Have several different and complex passwords for each online account to prevent a compromised password from providing access to all of the accounts. People can use a password manager to help create

and store these unique passwords. The U.S. Cybersecurity & Infrastructure Security Agency says that strong passwords should be at least 16 characters; feature a random string of mixed-case letters, numbers and symbols; or comprised of a memorable phrase of four to seven unrelated words, known as a passphrase.

• Use two-factor authentication. Enable two-factor authentication (2FA) on all accounts to add an extra layer of security. This second form of verification often comes by the way of a texted or emailed code that must be entered to log into an account.

• Consider extra security for your credit report. Individuals can contact the three major credit bureaus and bolster their credit-related security. A fraud alert tells businesses to check with the person before opening a new account to verify if it is really him or her. An initial fraud alert or active duty fraud alert expires in a year, while an extended fraud alert lasts seven years, but requires an FTC identity theft report. A credit freeze is a greater mea-

Grow your money with these options

Individuals looking to grow their money have many options at their disposal. For example, real estate is often cited as a wise investment, as the value of property has historically increased by a significant margin over the course of a lifetime, providing a substantial return all the while fulfilling the basic need for housing that everyone has. But buying property is not the only potentially lucrative longterm investment strategy.

A small percentage of investors may have the skill, savvy and iron stomach to excel with short-term investments. But most people feel more comfortable with less risky, long-term investments. For such individuals, one strategy worth considering is passive investing.

What is passive investing?

Passive investing utilizes a buy-and-hold approach to gradually build wealth. Short-term fluctuations in stock prices do not affect passive investors, as one of the principles of passive investing is that markets will post positive results over time. So passive investors do not react with alarm when prices temporarily drop, even if they drop by a considerable margin. What is an index fund?

Index funds are one of the most recognizable forms of passive investing. The investment experts at Vanguard, the company that first started offering index funds, note that an index fund contains a preselected collection of hundreds or even thousands of stocks or bonds or a combination of both. The theory behind this is that, even if one stock or bond is performing poorly, another within the portfolio is doing well, thus minimizing losses and saving investors the time and effort of tracking, as well as buying and selling, individual stocks or bonds.

Diversification and passive investing

Conventional investment wisdom has long touted the benefits of diversification when investing. When investors put all of their eggs in one basket, they could then lose all of their investments if the value of that investment goes south. As previously noted, index funds include a collection of stocks, bonds or both, thus providing investors with sufficient diversification that can serve as something akin to a safety net when the values of certain stocks or bonds within the portfolio dip. Though no investment strategy can claim it is free of risk, passive investing through a vehicle such as an index fund can be a lowrisk way to grow wealth over time.

Criticisms of passive investing

The investment resource Investopedia cites lack of flexibility and smaller potential returns as two significant drawbacks of passive investing. Passive investment funds are limited to a predetermined set of investments that don't often vary, if at all. That might be not sit well with individuals who prefer a more active and flexible approach to investing.

Big returns also are less likely with passive investment funds, as these funds are designed to track the market, not beat it by a wide margin. Individuals with long-term investment strategies likely won't be turned off by this, though those looking for bigger rewards (which, notably, carry bigger risk) may be underwhelmed by the returns on passive funds.

Passive investing is a sound investment strategy for individuals who want to grow their wealth over the long haul.

sure of security that keeps others from getting into the credit report at all (with a fraud alert the credit report can still be accessed). That means no one can open a new credit account while the freeze is in place. It must be lifted each time a person wants to open a new account.

• Protect your identification numbers. Individuals should not carry a Social Security card in a wallet or give out their Social Security Number (Social Insurance Number in Canada) unnecessarily.

• Exercise caution on the phone and when answering emails. Scammers can mislead others by using seemingly legitimate phone numbers or email addresses to solicit information. Always verify the validity of requests before sharing personal information.

• Regularly check accounts. People should double-check all financial accounts periodically for suspicious transactions. Each year individuals are able to request and check a free credit report from Experian, TransUnion and Equifax.

• Use a secured internet connection.

To reduce the risk of data being stolen, only review financial information when utilizing a secured (password locked) internet network.

Taking strides to protect personal data is important to safeguard one’s financial security.

Effective money management can help men and women achieve their short- and long-term goals. Wise investment strategies and a commitment to saving for retirement are great ways to manage money over the long haul, but it’s important to seek ways to do so in the short-term as well.

Monitoring financial health is a shortterm strategy that can keep individuals

3 metrics that can help people gauge their financial health

on a path toward longterm security. While various metrics can be looked to as indicators of financial health, adults can keep these three variables in mind as they look to utilize short-term strategies to ensure their long-term success.

1. Debt-to-income ratio: Debt-to-income ratio can be a good indicator of financial health. The Consumer Financial Protection Bureau defines debt-to-income ratio (DTI) as all your monthly debt payments divided by your monthly gross income. Lenders utilize DTI to determine the creditworthiness of loan applicants, but individuals also can use it as a metric to gauge their financial health. Monthly debt payments include mortgages, auto loans,

student loans, and other debt payments, including credit cards. Individuals whose debt payments total $2,000 per month and who earn a gross monthly income of $6,000 have a 33 percent DTI. The credit experts at Experian suggest a DTI of 35 percent or less is indicative that debt is being handled well, so that’s a figure to keep in mind.

2. Savings balances: Savings accounts don’t generate as much interest as they did throughout the 1980s and 1990s. According to Nasdaq, savings interest rates climbed as high as 8 percent in the 1980s, but have fallen below 0.25 percent since the financial crisis of 2008. That’s led some to devalue savings, but savings balances can be a good indicator of financial health. A substantial savings account can help individuals avoid taking on debt when costly emergencies and expenses arise unexpectedly, thus helping them keep their DTI in a financially advantageous range.

3. Credit score: Credit score is another strong, and easily accessible, indicator of personal financial health. Individuals can now access their credit scores for free each month through their banks and credit card providers. Experian notes that credit scores range from 300 to 850, and where a score falls in that range can indicate if a person is managing credit in a healthy or unhealthy way. Experian reports scores 740 and above are very good, while scores between 670 and 739 are considered good. Scores between 300 and 579 are considered poor, while a score between 580 and 669 is considered fair. Scores below 669 indicate there’s room to use credit more wisely, which involve reducing reliance on consumer credit, making payments on time and ensuring payments are more than the monthly minimum. These three metrics and others can be utilized by individuals looking to gauge their financial health in an effort to realize their short- and long-term goals.

Benefits Of Getting A Loan Through A Credit Union

Getting a loan through a credit union offers several advantages that can make borrowing more affordable and less stressful. Because credit unions are not-for-profit and memberowned, they typically provide lower interest rates, fewer fees, and more flexible repayment terms. Here are some key benefits of getting a loan through HPC Credit Union.

1. Competitive Loan Rates

Credit Unions like HPC Credit Union offer low-interest rates on a variety of loan types, including auto loans, student loans, mortgages, and more — which can make borrowing more affordable than at many banks.

2. Member-Focused & Personalized Service

Credit unions like HPC are member-owned cooperatives, not profit-driven corporations. That means loan officers often take more time to understand your individual financial situation and may provide more personalized guidance and flexible lending solutions than larger banks.

3. Lower Fees and Costs

Credit unions generally charge fewer and lower fees than traditional banks — from

origination fees to ongoing loan costs — because they reinvest earnings back into member benefits instead of paying shareholders. At HPC, we are proud to offer our members completely free checking accounts!

4. Flexible Loan Options

Credit Union’s offer a wide variety of loan options for your needs! HPC offers a range of loan products — from low-rate auto loans to fixed and adjustable-rate mortgages and business loans— so you can choose the option that best fits your goals and budget.

5. Community & Member Rewards

As a member of HPC Credit Union, you’re eligible for perks like completely free checking accounts, direct deposit early pay (up to two days), accounts insured up to $1.5 million, plus more!

How to determine your financial needs in retirement

No one knows what the future holds. Despite the mystery shrouding the future, it’s still vital that people plan for the years ahead, particularly in regard to saving for retirement.

Advice abounds regarding how much money retirees will need to live comfortably in retirement. One common approach suggests retirees should aspire to replace 70 to 80 percent of their pre-retirement income, while another strategy urges retirees to save twelve times their final pre-retirement income, meaning someone making $100,000 in the year they retire will need at least $1.2 million in retirement savings to maintain their lifestyle. Each of these approaches are just strategies, and how much a person actually needs in retirement will depend on a host of variables unique to each individual, including the age a person retires, his or her health status at the time of retirement and personal goals for their golden years. For example, those who hope to retire at 65 and travel extensively in retirement will likely need more savings than someone who hopes to retire at 70 and travel less frequently.

Though variables unique to each person will help to determine how much to save for retirement, there are some additional ways to identify how

much you might need to live comfortably after calling it a career.

• Identify your ideal retirement age. Arguably the most significant variable related to saving for retirement is the age at which a person hopes to retire. Some may have the luxury of choosing their own retirement date, while others’ personal health or employers may make that choice for them. But it’s good to remember that the longer a person continues to work, the less retirement savings that person will need. When trying to determine how much to save for retirement, first identify your ideal retirement age and then go from there, recognizing that this important variable can change over time.

• Identify the lifestyle you hope to live. If the romanticized ideal of a jetsetting retirement lifestyle appeals to you, then you’re likely going to need to save more for retirement than someone whose vision of life after working is less glamorous. It’s possible for many retirees to live their ideal lifestyle in retirement, but those whose ideal is marked by expensive pursuits like regular international travel will need to start earlier and save more than someone who envisions occasional trips but more time at home.

health care

Health care costs for retirees are heavily dependent on individual health. But even the healthiest retiree might experience a sudden and potentially costly medical issue, so it’s best for everyone to plan for sizable health care expenses in retirement. The Employee Benefit Research Institute estimates that couples will need to have saved at least $188,000 to have a 90 percent chance of covering their health care expenditures in retirement. That figure is subject to variables unique to each individual, but it can serve as a useful measuring stick as adults try to deter mine how much they need to save for retirement.

Financial needs in retirement depend on the individual. However, some key planning strategies can help individuals determine how much they might need to save to live comfortably in retirement.

There are many ways for individuals to determine if they’re spending beyond their means. One such avenue is to determine the level of consumer debt they’re carrying, which could be an eye-opening metric for millions of people.

According to the Federal Reserve Bank of New York, credit card balances rose by $27 billion in the second quarter of 2025, ultimately reaching $1.21 trillion. Though millions effectively manage credit and thus use it to their financial advantage, others struggle to keep their heads above water after accumu-

Pitfalls that can lead to spending beyond your means

lating large amounts of consumer-related debt. And such debt is not the only pitfall that consumers can look to avoid in an effort to spend within their means.

• Failure to budget: A failure to budget can make it hard to know how much is coming in and how much is going out. Budgeting is a financial strategy embraced by consumers across generational lines, as a recent poll from NerdWallet found that 83 percent of millennials, 67 percent of Baby Boomers and 74 percent of Gen Xers adhere to a monthly budget. Those who fail to embrace budgeting may not save much money and thus be more likely to accumulate debt when unexpected expenses arise.

• Failure to save: Budgeting and sav-

ing go hand in hand. Budgeting helps people avoid daily overspending, and it also helps people finance costly expenditures like travel and big-ticket purchases by facilitating saving. A failure to save money leaves individuals with no financial safety net, which can force them to use high-interest credit cards to pay for significant expenses like home repairs and medical bills. When credit card balances are not paid in full each month, the resulting interest charges can quickly add up and even exceed the initial expense.

• Impulsive spending: According to CapitalOne Shopping Research, 36 percent of consumers indicate the majority of their purchases are unplanned. Impulse buying has long been an issue for many people, but it might pose an even bigger threat now. That’s because smartphone shopping apps mean the next purchase is never more than

a smartphone swipe and click away, which is perhaps one reason why CapitalOne reports the average consumer made 9.75 impulse buys per month in 2024. Smartphones are here to stay, but consumers concerned about their ability to resist impulse spending can turn off shopping app notifications and opt against storing credit card numbers in shopping apps and on websites. The added inconvenience of being asked to enter personal information each time you make a purchase might compel some shoppers to spend less impulsively.

Increases in consumer debt suggest many people are struggling to avoid various pitfalls that can lead them to spend beyond their means. A concerted effort on the part of consumers to right their financial ships involves recognition of the various pitfalls that can threaten their financial security.

How much home can I afford?

By the third quarter of 2025, the tide seemingly began to turn in regard to a housing market that had been marked by limited inventory since the onset of the COVID-19 pandemic in 2020. According to market indicators from Redfin, the National Association of REALTORS® and Homes for Heroes, by the summer of 2025 things began to shift in regard to inventory (9.4 percent increase year-over-year). Prices also began to level off, as the median existing home price in the United States was $435,300 in June 2025, which marked a 2 percent increase from the previous year. Price reductions also became more common compared to 2024, signalling a cooldown in some segments.

Although affordability concerns still persist, many people may finally be ready to enter the home-buying arena. When doing so, it’s essential prospective home buyers recognize how much they can comfortably spend on a home. Most experts suggest buyers combine lender affordability guidelines with an assessment of

one’s personal budget. These factors can help individuals determine a reliable budget when shopping for homes.

• Debt-to-income ratio: Lenders use various parameters to identify a borrower’s creditworthiness. That includes figuring out a person’s debt-to-income ratio (DTI). Wells Fargo says DTI can be calculated by adding up all of a person’s monthly debt payments and dividing them by gross monthly income. That number is multiplied by 100 to get a percentage. The lower the DTI, the less risky one is to lenders.

• The 28/36 rule: Part of the DTI equation may include the 28/36 rule utilized by many mortgage lenders. This is a standard guideline that can help one see if it’s possible to afford a home loan. The 28 percent is allotted housing costs. The monthly housing expenses (principal, interest, taxes, homeowners insurance, private mortgage insurance, and homeowners association fees) should be no more than 28 percent of one’s gross monthly income. One’s total

Just 5% Can Change Everything for the Better

Dee Brown Perry was a quiet, yet generous member of our northeast Michigan community. She cared about education and wanted to see students from Alcona County have the opportunity to attend college. Upon her passing in 2005, she left a planned gift through the Community Foundation for Northeast Michigan to do just that. When scholarships are awarded this year, the total amount given since 2005 will eclipse the original $1.3 million gift. At this rate, in another 20 years, her fund will have awarded the original gift amount four times over. That is the power of endowment, and the power of committing to keep some of your assets local.

Northeast Michigan is in the process of losing billions of dollars as assets pass from one generation to the next in what is commonly referred to as the “transfer of wealth”. Most of that wealth will leave our communities, but if we as a community could work together to preserve just 5% for the betterment of the place we call “home”, it could mean a world of difference for northeast Michigan’s future.

If you think you are not part of the transfer of wealth, think again. Regardless of the size of your bank account, if you own a home (even one you still owe money on) or property; own a car – fancy or not; or have an IRA, 401K or life insurance policy, then you have an estate. Even owning a prized collection of rare, vintage collectibles

means you have an estate. All these things have monetary value and there should be a plan for what happens to these possessions.

This is where that magic 5% comes in. If we all committed just 5% of assets to stay locally in permanent charitable funds, by 2050 (when there’s still a decade left of the transfer of wealth), it would mean an additional $42 million in annual grants for our community. Even if you choose not to have your donation be a permanent gift, you can still direct it to a local charity and affect the good of your community, helping you create a meaningful legacy. So how do you do it? One of the easiest ways is to designate a charity as the beneficiary that will receive all or part of a retirement account or life insurance policy - simple changes that can be made online or with a quick phone call.

You can create a will or tweak your current will; contact a financial planner or local attorney to get some advice; or contact your local community foundation whose staff can help match your passions with planned giving.

If just 5% can ensure a bright future for northeast Michigan, we should all take every opportunity to make it a reality.

monthly debt payments, including housing, car, loans, student loans, and credit cards, should be no more than 36 percent of the gross monthly income. So if a prospective home buyer earns $10,000 per month, or $120,000 per year, the housing costs should not exceed $2,800. Total debt payments, including housing, should not exceed $3,600 per month.

• Personal budget considerations: Lenders may allow borrowers to borrow a certain amount of money, and buyers then go out and spend that much on a home. But to avoid living paycheck to paycheck and having all of one’s money go toward a home, it is best to account for personal spending habits and savings goals. It’s important to have an emergency funds account to pay for unexpected things like home repairs, or to account for instances when income may decline. Ongoing costs to manage the home also merit consideration, as do utilities and future renovations.

• Income-to-home price ratio: Some people abide by another general guide-

line to shop for a home that costs no more than three to five times their annual household income. That means with an annual income of $100,000, one should aim for a home priced between $300,000 and $500,000. The specific range will also depend on a person’s existing debt.

• Interest rates and other factors: The interest rate on home mortgages as well as down payment also must be considered. Resources like Bankrate and Zillow provide home affordability calculators that will factor in interest rates, terms of a loan, down payment, and property taxes. Buying a home when interest rates are high means spending more over the life of the loan. Also, how much one puts toward a down payment has a big impact. Aiming for 20 percent means avoiding paying for private mortgage insurance (PMI).

There is no fail-safe way to determine how much home you can afford. Many factors are in play and are exclusive to buyers in the market for a new home.

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