INDEPENDENCE Financial Freedom the Credit Union Way

THE MAGAZINE FOR TODAY’S FINANCIAL SAVVY CONSUMER

LORI WOODRUFF Member Services Representative

20 years of dedicated service

Paycheck

CHECKUP2018 Tax Changes

Become

FINANCIALLY Fit in 2019

Small Tips to Big SAVINGSHome & Auto Insurance“I joined the

CREDIT UNION when I was 10 years old. Since then, they have taken the time to teach me

how to

MANAGE MY MONEY, including how to get the best deal on my last new car.”

Brookings | De Smet | Huron | Redfieldwww.DakotalandCommunityInsurance.com | 800.257.7353

We know you will worry about every detail. So do we.A Good Reason to Leave the Insurance to Us

Dakotaland Community Insurance is a separate entity from Dakotaland Federal Credit Union

We know you will worry about every detail. So do we.A Good Reason to Leave the Insurance to Us

ADMINISTRATION CENTER DESIGNED FOR BRANCH SUPPORT AND FUTURE GROWTH

The new Dakotaland Administration Center in Huron is nearly complete and should be ready for business shortly after Christmas. The new headquarters is essential for future growth and will create improved efficiencies in the management of the organization. Our plan for the new Administration Center is to house our administrative staff on the second floor with the primary entrance on the east side of the building. The management team is responsible for all 12 Dakotaland Branches and their primary duties are to lead and support the organization as a whole. Currently the Dakotaland Management Team is located in the basement of the main office with several offices housing two, or even three, people per office. We plan to move 30+ employees to the second floor of the new facility prior to the end of the year. We also intend to utilize the north end of the first floor with a drive–up convenience center similar to our North Branch in Huron. Members can complete teller transactions and will have the option of using the drive–up or accessing thelobby through the northwest door. continued on page 12

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In the

CREDITS & CONTACTSDakotaland Federal Credit Union | 1371 Dakota Avenue S. | Huron, SD 57350 | 800.440.6573

PUBLISHER/EDITOR: Dawn Mutchelknaus | dawnm@dakotalandfcu.com • DESIGN/LAYOUT: Emily Kuehl | emilyk@dakotalandfcu.comPRINTING: Brad McGirr/Creative Printing | brad@creativeprinting.com • ONLINE: www.DakotalandFCU.com | Facebook.com/DakotalandFCU

DAN CUMBEE President | CEO

Loop

2 | Independence

INDEPENDENCE: Helen, as a seasoned loan officer you have had a great deal of experience with extended auto warranties. Can you tell us more about these types of warranties?H. JOHNSON: Of course. I like to think of a ‘warranty’ as an additional layer of protection against the unexpected cost of mechanical breakdowns on your vehicle. INDEPENDENCE: On the purchase of a new car should an extended warranty be considered?H. JOHNSON: In the case of new vehicles, they traditionally do not require additional coverage. New autos come equipped with factory warranties, which provide protection for an initial set of years and/or miles. INDEPENDENCE: What are your thoughts on extended warranties for used vehicles?H. JOHNSON: A large number of the loans I handle are auto loans and a good portion of those are used or pre–owed vehicles. I feel this is when it is most important to have a discussion about an extended warranty. INDEPENDENCE: In your experience, which used vehicles are the best candidates for an extended warranty?H. JOHNSON: I find there are three instances where an extended warranty may be worth the investment. The first are high mileage vehicles. These autos may be in very good condition, but the high mileage may increase your chances of a major repair. The second are vehicles with expired factory warranties. Again, due to number of miles or the age of the vehicle, the factory warranty is no longer valid. The third are vehicles which have a history of mechanical issues. In some cases, certain makes and models or production year, may have a record of breakdowns and/or recalls. continued on page 12

EXTENDED AUTO WARRANTY

< Pay or Pass >

INTERVIEW WITH HELEN JOHNSON Dakotaland Federal Credit Union Loan Officer | Brookings

“It is not my mission to sell you an extended warranty, but it is my job to

present you with the options I have available and

let you decide if it’s the right fit for you.”

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As the weather starts to transition into winter, it is time to think about making plans for your spring building project. The sooner you have your project in order the better the odds are you will move to the front of the line with your contractors when the frost comes out of the ground next spring. There will always be changes and decisions to be made during the process of the build, but having the majority of the details hammered out now will make for a smoother (and on budget) project.Choosing Dakotaland Federal Credit Union for all your building needs can make the process easier.

O NERC RConstruction

Never too Early to Start

to the

fromBREAKING GROUND

we’re there every step

final

CONSTRUCTION loan rates as low as apr*2.90%

*annual percentage rate | NMLS #657864

• Utilize the Construction Loan Specialist to help you with the process by going through your bids and estimates to determine everything is included and ensures nothing has been overlooked. • Take advantage of easy reimbursements for the purchases you make for your construction project. You will be able to email receipts and invoices directly and have them paid or reimbursed as early as the same day. There is no waiting on a monthly draw from the construction loan.• Oversee your own project. No General Contractor is required. Plus, you can buy construction related items from the vendors of your choice and be reimbursed quickly from the receipts you provide.

MARK PETERSON Construction Loan Specialist

Dakotaland Federal Credit Union

BRICK

Bundle Policies for Easy Savings Combining your auto insurance with your homeowner’s or renter’s insurance can lead to big discounts. Auto insurance is the riskiest insurance for companies to offer, so bundling it with a policy you’re less likely to use makes it more enticing for insurance companies to offer a deep discount. Many of the companies offered through Dakotaland Community Insurance offer this type of discount.Don’t Leave Discounts on the Table Different insurance companies offer different discounts. Some discounts to ask about when reviewing your homeowners insurance may include alarm systems, extra smoke detectors, bolt locks on your doors, and being a non-smoker. Your auto or motorcycle policy may offer discounts such as completed safety course classes and discounts for youthful drivers who have completed Drivers Education and have maintained at least a B average in school. Many companies will offer discounts on your home and auto policy by simply paying the premium in full or setting up EFT payments for your monthly premium. Higher Deductible, Lower PremiumPay close attention to your options when it comes to deductibles and monthly premiums. A low deductible (the amount you will pay out of pocket for a claim) usually means a higher premium. Consider raising your deductible in order to reduce your premium amount. This could save you a considerable amount

Small Tips to

BIG SAVINGS

on Your Home and Auto Insurance

of money if you don’t need to file a claim for a while. Do keep in mind, that if you are going to raise your deductible, make sure you set aside enough money to cover that higher deductible in case a disaster should strike. Avoid Making a Claim Whenever PossibleYou may also be eligible for a discount if you don’t file a claim over a certain period of time. If you can comfortably pay for the claim out of pocket you may want to consider that instead of filing a claim. The moment you make a claim you also run the risk of your premium increasing. As soon as an insurance company pays out a claim on your behalf, you’re considered more likely to cost them additional claims in the future, therefor there may be an increase in your premium. This may seem silly to pay for something you rarely use, but it may be better in the long run to not file as many claims.Keep an Eye on Your Credit Score, Motor Vehicle Record and CLUE ReportMany insurance companies use your credit score as a factor in helping to determine your coverage terms and premiums. By obtaining free credit reports you can keep an eye on your score and work towards increasing or maintaining it. Insurance companies will also pull reports such as your Motor Vehicle Record and CLUE reports, which also factor into your premiums. It is important to make sure any accident and violations are reporting correctly on your MVR and that any past claims are showing up correctly on your CLUE report. If anything seems out of sorts please contact your local agent to direct you on how to straighten these out.Dakotaland Community Insurance values each of their customers and we are here to make sure all of your insurance needs are met. Please do not hesitate to contact your local agent in Huron, De Smet, Brookings, or Redfield for a free, no obligation quote today!

4 | Independence

Independence | 5NMLS #657864

FEEL the FREEDOMeliminate payments with the help of a low interest home loan

CONSOLIDATE• Student Loans

• Medical Bills

• Credit Card Debt

• Home Improvement Expenses

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EXPLORE A NUMBER OF MONEY SAVING OPTIONSFirst and Second Mortgages or a Home Equity Line of Credit with Local Decisions & Servicing

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Become

FINANCIALLY

FIT RYAN GOEHNER

Chief Financial OfficerDakotaland Federal Credit Union

2019in

As we approach the New Year and think about setting New Year’s resolutions, have you ever thought about setting a resolution to become financially fit?Dave Ramsey is a well–known financial advisor and the creator of Financial Peace University, a program that gives everyday individuals tools to help them manage their money. Dave stresses the importanceof knowing where all your money goes each month. Setting a budget and tracking your expenses helps you regain control of your money because you tell your money where to go. It is not always fun to set a budget and track your expenses, but this is an important step in planning for your financial future.

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Become

FINANCIALLY

FIT 2019

steps to creating a budget

Start with your monthly income and subtract your expenses for the month. It is a good idea to start with the expenses you know you will have, such as loan payments, rent, utilities, phone, etc. Next allocate how much you will spend on the remaining expenses. Is there a category you are spending more than you realized and could reduce your spending going forward? It is also important to put a little into savings each month for any unexpected emergencies and/or to prepare for retirement.Now you have your budget set up. Check your expenses each month going forward to ensure you are staying on track. Also, as things change, such as income or loan payments, don’t forget to update your budget. You don’t want to be saying to yourself a few months into the new year, “where did I spend my money?”

THREEIf you have never done a budget before, one of the places to start would be to look back at your spending over the previous three months to help determine your average monthly expenses. If you currently use a budget, it might be a good time to verify if it is still relevant or if it needs to be updated.

Write down your monthly income and categorize all your expenses. Create categories that make sense for you. Some examples of categories could be:• Household (Mortgage/Rent, Real Estate Taxes, Home Insurance)

• Utilities (Electricity, Gas, Water, Phone, Internet, Cable)

• Food (Groceries, Dining Out)

• Transportation (Auto Loan Payment, Gas, Repairs, Auto Insurance)

• Personal (Clothing, Entertainment, etc.)

Once you have determined your average monthly income and expenses, now you can create your budget.

continued on page 9

Harness the

POWER of an Individual Retirement Account

LORI WOODRUFF Member Services RepresentativeDakotaland Federal Credit Union

“Due to the ease of use and the tax advantages,

AN IRA IS A POWERFUL INCENTIVE to start saving early for retirement.”

So, your employer offers a 401K or Retirement Plan as part of your benefits package. Wonderful! I encourage everyone to take full advantage of one of the most common ways to invest in retirement. But what about those who don’t have access to an employer sponsored plan? Or what if your employer plan is not equipped to meet your retirement goals? What retirement options are there for those who own a small business or are self–employed? An Individual Retirement Account, or IRA, can provide a simple solution to these questions and more. An IRA is a type of investment account with tax benefits that can help you save for retirement. Sadly, it may be one of the most under–utilized savings options available to the middle aged, working class American. When you are in your 20’s, 30’s and even 40’s, retirement feels lightyears away. Traditionally, during these stages of life, paychecks are dedicated to car payments, a mortgage, student loans and raising a family. This leaves thoughts of savings and retirement plans on hold.On the upside, putting an IRA to work for you requires a little investment and even less time, but has the power to pay off in the future. IRA’s can be opened at most financial institutions through a process similar to opening a savings account. There is no minimum opening balance and setting up a direct deposit from your payroll to your new IRA will get your savings plan off to a successful start.

• WHO CAN OPEN AN IRA? Anyone with earned income, which is income from a job that is claimed for tax purposes, not investment income or Social Security can open an IRA Account.• WHEN SHOULD YOU START? Start contributing to an IRA as soon as you get your first job. If it is too late for that, now would be a great time to start. The longer your money is invested, the more you can harness the power of your contributions.• HOW MUCH CAN YOU CONTRIBUTE? The annual contribution limit for an IRA is $5,500 for 2018, and $6,500 for savers over 50 years old.

• HOW DOES THE TAX BENEFIT WORK? The specific tax benefit depends on the type of IRA you choose: Roth or Traditional.• WHAT IS THE DIFFERENCE BETWEEN ROTH AND TRADITIONAL? 1. A traditional IRA most always offers a tax deduction for the tax year in which the contribution was made. 2. A Roth IRA gives investors the chance to invest money after taxes and then take the contributions and earnings out tax–free in retirement. As long as you wait until you’re 59 1/2 years old to withdraw funds, earnings will not be taxed.

8 | Independence

LORI WOODRUFF Member Services RepresentativeDakotaland Federal Credit Union

“Due to the ease of use and the tax advantages,

AN IRA IS A POWERFUL INCENTIVE to start saving early for retirement.”

• Do you have your paycheck automatically deposited into your account? This will save time and reduce the hassle of making a deposit. If you still receive a paper check, are you utilizing mobile deposit? This would allow you to make a deposit without having to drive to your financial institution.• Do you have your loan payments set up to be automatically paid? This will eliminate the need to remember to make your loan payment each month. Some types of loans allow you to set up monthly, weekly or bi–weekly payments to coincide with your paycheck, so they work for you and your schedule. • Did you know it is possible to create multiple savings accounts at your financial institution? You could create a savings account for an emergency fund, the vacation that you want to go on or the major purchase you are looking forward to. This is a great way to separate your savings from your everyday spending or checking account.• Have you checked to see if your financial institution allows you to have deposit splits? When your paycheck gets automatically deposited, you could have a certain amount of money deposited into your different savings accounts, with the remainder going into your checking account. Also, depositing a little money each month into a savings account or an Individual Retirement Account (IRA), can really add up over the course of a year. ($50 every other week would be $1,300 a year) • Do you have any alerts set up on your account or VISA® card? You can set up alerts to let you know when a loan payment is due, when you have a low balance or when various transactions have occurred. You can also set up alerts on your VISA® debit or credit card to notify you via email or text on certain transactions, based on the criteria you set.Dakotaland Federal Credit Union offers its members a mobile app that provides the ability to make inquiries, mobile deposits, transfers, loan payments and many more features. Another service available to all members is MoneyDesktop, a Personal Financial Management tool, that helps you budget and manage your finances. It allows you to import all of your accounts, across multiple institutions, so you can see your balances and transactions all in one place. It is available for FREE through our e*Teller online banking. It features a number of dynamic money management options such as making budgets, setting goals, tracking your spending, monitoring your net worth, loan payment projections and much more. Stop in to your local Dakotaland Branch location to see how our mobile app or MoneyDesktop could benefit you.

TIPS & IDEAS

Now that you know where your money is going each month, here are a few other ideas to consider:

Independence | 9

continued from page 7

10 | Independence

With the Tax Cuts and Jobs Act (TCJA) effective for tax year 2018 there are several changes that taxpayers need to be aware of as we are nearing the end of the year and preparing for our tax filings.One of the most talked about changes is the increase in the standard deduction for taxpayers. In 2017, the standard deduction for joint filers was $12,700 and in 2018 it increases $24,000 ($12,000 single and $18,000 head of household). This change, along with the change of the tax brackets, is expected to save most taxpayers about 3% in taxes. However, with this increase, the personal exemption amount has been repealed (In 2017, this was $4,050 per person in household).With the change to the standard deduction and personal exemption amounts, it is important for taxpayers to review their paystubs and do a “paycheck checkup.” The federal withholding tables were updated in February 2018 to reflect the changes, however if a change was not made to the taxpayers W–4 the withholdings on wages could be excessive or inadequate. You can perform a “checkup” at irs.gov or contact Dakotaland Financial Services for assistance.Another change is the increase in the Child/Family Tax Credit. In 2017 a taxpayer was eligible for up to a $1,000 credit for each qualifying child under the age of 17. This increases to up to $2,000 ($1,400 being refundable) in 2018 under TCJA. Other dependents not eligible for the child tax credit could be eligible for

PAYCHECK CHECKUP2018 Tax Changes

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2018 TAX BRACKETSSINGLE MFJ/QW MFS HOH

10% $9,525 $19,050 9,525 $13,60012% 38,700 77.400 38,700 51,80022% 82,500 165,000 82,500 82.50024% 157,500 315,000 157,500 157,50032% 200,00 400,000 200,000 200,00035% 500,000 600,000 300,000 500,00037%

CAPITAL GAINS TAX BRACKETSSINGLE MFJ/QW MFS HOH

0% $38,600 $77,200 $38,600 $51,70015% 425,800 479,000 239,500 452,40020%

Moving expenses have also been repealed (except for armed forces), and alimony paid/received is not a taxable event for divorces or separations executed after 12/31/2018. With the increase to the standard deduction and changes to deductions, it is expected that far fewer taxpayers will be itemizing deductions for tax year 2018.Also, taxpayers are now able to receive tax-free distributions from qualified tuition programs (Section 529 Plans) for elementary and high school tuition costs up to a $10,000 annual limit. This tuition may be for public, private, or religious schools.Lastly, the Tax Cuts and Jobs Act has repealed the individual shared responsibility payment with respect to health care coverage , but this does not take effect until after December 31, 2018 so proof of health insurance coverage will be needed when filing your 2018 return in 2019. Although rumored to have changed: the educator expense deduction for teachers, deduction for student loan interest, and education credits remain the same as previous years.

the family credit up to $500 each. The phase out for the credits are increased to $200,000 ($400,000 for joint filers) adjusted gross income (AGI) which will open the credit up to more taxpayers. To be eligible for the Child Tax Credit, a child must have a valid Social Security Number.In addition to the changes above, TCJA has limited and discontinued deductions previously included in Schedule A (Itemized Deductions). These changes include: property and state/local income taxes limited to a total deduction of $10,000, mortgage interest is limited based on acquisition cost, charitable contribution cash limit increases to 60% of AGI, personal casualty losses repealed (except for declared disaster areas), medical expenses threshold set to 7.5% of AGI for all taxpayers in 2018 and returns to 10% in 2019 and all job expenses and miscellaneous deductions subject to the 2% of AGI floor have been repealed. Some of the job expenses and miscellaneous deductions no longer deductible include: employee business expenses, tax preparation fees, hobby loss expenses and home office expenses for the employee. Investment interest expense is not affected by the change in law.

MFJ – Married Filing Jointly | QW – Qualifying Widow(er) | MFS – Married Filing Single | HOH – Head of Household

continued from page 2

INDEPENDENCE: What features should a good extended warranty product offer?H. JOHNSON: Having purchased a number of different warranties myself, I find Route 66 Warranty is a product I feel offers solid and affordable coverage. I particularly like the fact their warranty is available even if the auto loan is not with Dakotaland. I also appreciate the zero deductible, the plan is transferable if the car is sold, it comes with emergency road side assistance and it has a total loss refund so if the auto is totaled the loan is paid off and the premium is refunded. In addition, I have gotten comments from the repair shops stating how easy this company is to work with, which is a very important component. INDEPENDENCE: What should someone expect to pay for an extended warranty?H. JOHNSON: Most warranty companies have various levels of coverage with different price points. For example, with Route 66 you can expect to pay $1,800 for a basic plan of mechanical breakdown coverage for three years or 36,000 miles. As with any warranty, you need to weigh the risk against the cost, but I can assure you an extended warranty could turn out to be a minor investment if faced with replacing a motor or transmission at $3,000 to $6,000 by a certified mechanic shop.

12 | Independence

We Offer Year End Payroll and Bookkeeping Reportingand Tax Planning with the New Tax Laws

continued from page 1

We intend to keep both the Main Office at 14th and Dakota Avenue and the North Branch at Dakota Avenue and Highway 14 open and conducting business as usual. In fact, the Main Office will continue to be the primary location for member business. Our Loan Officers and Member Service Representatives will remain in the Main Office and available to transact all your borrowing, savings, investment or new account needs.We overbuilt the Administration Center to allow for future growth. This allows us to rent out a significant part of the first floor to tenants. This rent income will help offset some of the expenses of the new facility. We currently have three tenants that are also scheduled to open on the first of the year or shortly thereafter. We still have some rental space available. Please contact me if you are interested.

FINANCIAL SERVICESLLC

Bookkeeping | Payroll Processing | Payroll Reporting | Tax Planning | Tax Preparation | Consulting

1371 Dakota Avenue South, Suite 100| Huron, SD 57350www.DakotalandFS.com | info@dakotalandfs.com | 605.353.8777Dakotaland Financial Services, LLC. is a separate entity from Dakotaland Federal Credit Union.

We Offer Year End Payroll and Bookkeeping Reportingand Tax Planning with the New Tax Laws

Don’t Add Another Thing to Your List

1371 Dakota Avenue South Huron, SD 57350

THE MAGAZINE FOR TODAY’S FINANCIAL SAVVY CONSUMER

Become

FINANCIALLY Fit in 2019

— Sasha Ford | Huron

“I joined the

CREDIT UNION when I was 10 years old. Since then, they have taken the time to teach me

how to

MANAGE MY MONEY, including how to get the best deal on my last new car.”