When the going
Two smart money moves
during uncertain times
By Tim Talevich
RISING GAS PRICES, a troubled housing
market, increasing costs for groceries, volatility in the stock market—these all spell tough
economic times. In response, you can stretch
your dollar with commonsense moves such as
carpooling or taking public transit and reducing spending on nonessentials.
Other smart money moves are improving
your credit scores and optimizing your savings account—areas where Costco provides
tools that can help. Here’s a look.
columnist specializing in second homes
( www.tomkelly.com). “Borrowers are being
more scrutinized than before,” says Kelly.
“Lenders want to know the value of the home
and that the borrower is solid.”
Costco offers the Credit Reports, Scores &
Monitoring program through IdentityGuard®
to help members understand their credit. With
this program, you can receive a monthly credit
report showing data from the big three credit
bureaus: Equifax, Experian and TransUnion.
Keeping on top of your credit reports is
important for two reasons: You can find and
correct mistakes (which aren’t uncommon),
and you can detect unauthorized transactions
that might suggest fraud.
Even small improvements in your credit
score can have a huge financial impact, says
Joe Vacca of Intersections Inc., the provider of
IdentityGuard. For example, a difference of a
quarter or a half percent on an interest rate
could equate to $50,000 or $80,000 over the
life of a typical 30-year loan.
Another helpful feature in the program is
the Credit Analyzer tool. It enables you to create “what if” scenarios to see how decisions
could affect your credit.
“When you’re looking at making payments or making decisions in a tough market,
the Credit Analyzer can tell you the best way
to apply those payments, as well as what
things on your credit report to review to help
you manage your credit score,” says Vacca.
The Credit Reports, Scores & Monitoring
program features other tools to fight identity
theft, including an insurance policy to reimburse victims for certain expenses (see “The
Earning higher interest on savings
In times of volatility in the stock and
bond market, a smart move is to find some
shelter from the storm.
One option worth considering in these
times is a money market account (MMA).
These accounts earn interest that usually outperforms the typical bank savings account.
And they are FDIC insured, so you can rest
assured your money is secure.
PHOTODISC/CHRIS A RUSNAK
Costco offers an MMA through Capital
One at an exclusive rate (see chart). Here’s
how the account works.
s It’s easy to open an MMA at costco.com
or by phone (see “Connecting” at lower left).
You can get started with as little as $1,000.
s You can add to it at any time, and making
a withdrawal is as easy as writing a check,
transferring money to an existing bank
account or taking money out of an ATM. As
with most MMAs, there are limits to how
many withdrawals you can make in a month.
s Unlike some investments, the Capital
One MMA is FDIC insured to at least
$100,000 per depositor.
“With no fees, a superior exclusive rate
for Costco members and flexible options to
access your money, the Capital One MMA is
a great place to save your money,” says Capital
One Direct Banking representative Carl
Lonnberg. “Especially at times when returns
from the stock market are so unpredictable.”
Regardless of the economic climate,
MMAs represent a safe place to stash your cash
with excellent interest and easy access. C
Monitoring your credit score
The best possible credit score is especially
important in tight economic times. A high
score can help you get a better rate on a
loan—or qualify for certain loans that aren’t
available to consumers with lower scores. In
fact, in terms of a home loan, a good credit
score may be necessary to even begin discussions with a lender.
In the wake of the home credit crisis, easy
loans are a thing of the past, advises Costco
member Tom Kelly, an author and syndicated
The Costco Connection
The Credit Reports, Scores & Monitoring
program through IdentityGuard® enables
members to review their credit reports and
provides protection against identity theft.
Enrolling in the program is easy: Just go to
costco.com, enter “credit reports” in the
search box and fill out the online application.
To open a money market account
through Capital One, go to costco.com,
enter “money market” in the search box
and fill out the online application, or call
Competitor comparison information pulled from www.
wellsfargo.com, www.usbank.com and www.wachovia.
com as of 05/21/08 using New York MMA rates. Rates
assume $5,000 account balance. The above non–Capital
One service marks are owned by each respective entity.
All rights reserved. Capital One Direct Banking MMAs are
offered by Capital One (USA), N.A., and Capital One, N.A.,
*As of 05/21/08, if the daily balance of the Capital One
MMA was $100 or more, the APY was 3. 20 percent; if
not, the APY was 0.00 percent. Minimum initial deposit
amount is $1,000. Terms and conditions of this offer
may change at any time. Rates are variable and may
change at any time. Withdrawal limits apply. © 2008
Capital One. Capital One is a federally registered service
mark. All rights reserved.