What is the Dark Web?

Q: What is the dark web?

A: The dark web is the deepest layer of the internet that isn’t visible to the average browser. Unfortunately, the it is full of illegal activities and crimes. Let’s take a closer look at the dark web and how you can protect your information from being snared.

What is the dark web?

The internet has been compared to an iceberg, with very little being visible above the surface, but it’s an enormous, dark and deep chasm underneath.

There are three basic parts of the internet:

The surface web – all websites and landing pages that can easily be accessed through popular search engines and direct address entry using a web browser.

The deep web – this includes private, but not invisible accounts, like social media pages, membership websites, medical records and more. All content on the deep web is safeguarded by a paywall or sign-in credentials.
The dark web – can only be accessed by using special browsing software called Tor. Tor masks IP addresses and makes all visitors anonymous.

Not all activity happening on the dark web is illegal. The deepest part of the internet also provides a platform for communication and commerce for people living in countries that have heavy censorship of online activity.

Unfortunately, though, the dark web remains a hotbed of criminal activity. Loads of illegal trade takes place through the dark web, including drugs, firearms, counterfeit money, subscription credentials and personal information of thousands of targets. The inherent anonymity allows hackers and scammers to roam free without fear of being caught.

How can I protect myself?

Enable two-step authentication on all online accounts.
Regularly monitor your credit for fraudulent activity.
Use strong, unique passwords for your accounts.
Never share personal info with an unverified source.

The dark web is impossible to trace, but there are ways to protect your information. Use the tips outlined here to stay safe.

4 Scams to Watch for After the Holidays

The weeks after the holiday season generally bring an increase in scams that can be difficult to spot. Watch out for these common post-holiday scams.

1. Charity scams

When giving charity this time of year, be extra cautious. Verify it’s legit by looking up the organization on CharityNavigator.org, doing a quick Google search with the “charity name+scam” and look for a physical address and phone number on its website. Also, if you have a specific cause you like giving to, contact them personally instead of clicking on an ad that allegedly represents them.

2. Bargain-priced gifts for sale

The weeks following the holidays bring a rush of scams on resale sites like Craigslist and eBay.

Avoid a gift scam by exercising caution when buying an item on a resale site, especially after the holidays. Ask for the seller’s phone number, street address and for several references to see if they check out. If everything seems to be in order, make arrangements to meet in a well-lit and populated area, preferably one with security cameras. Make the exchange after you’ve checked out the legitimacy of the item, using cash only.

2. Belated holiday e-cards

Scammers send thousands of virtual greetings after the holidays, most of which are loaded with malware. An authentic e-card will include a confirmation code for you to copy and paste to the associated website. If you receive a late e-card without such a code, don’t open it. Mark it as spam and delete the email.

4. Post-holiday sales

Unfortunately, lots of the advertised sales you may see in the weeks after the holidays are actually scams. The scammers may be working off a bogus site that looks just like one representing a legitimate business, or they may be targeting their victims with emails that advertise “sales,” but are embedded with malware.

Before making an online purchase, check the site for signs of authenticity. Look for the “s” after the “http,” and check for the lock icon in the URL. If the site allegedly represents a well-known retailer, check the URL for misspellings. Look for the store’s logo on the site, and continue to check the URL of each landing page as you complete your purchase.

If you spot one of these scams, report it to the FTC at ReportFraud.ftc.gov.

Stay safe!

How to Avoid Credit Card Fraud this Holiday Season

With the holiday shopping season heading into its final frenzied stretch, scammers are in full force, taking advantage of busy shoppers. Protect yourself, and your cards, from fraud with these safety measures and preventative tips:

Monitor your credit

Stay alert and identify the first signs of fraud to your credit accounts by reviewing your credit card statements well. It’s also a good idea to sign up for alerts to be notified of unusual or large purchases made on your card.

Strengthen your passwords

Do each of your accounts have their own unique password? Are passwords strong, using a combination of letters, numbers, and symbols as well as varied capitalization use? If any of your passwords use your personal information, like birth dates or street names, change them. They are easily guessed and then can be used to hack into multiple accounts and/or lead to identity theft. Strengthen any weak passwords now to prevent fraud.

Shop with caution

Only shop reputable sites and avoid clicking on pop-up ads or links in emails from unverified senders. To confirm a site’s security, look for the lock icon before the URL and the “s” after the “http.” Finally, make sure the security settings on your devices are updated and choose a VPN (virtual private network) when using public Wi-Fi.

Keep your cards close

Don’t forget to take basic precautions with your credit cards, especially if you’ll be hitting a lot of shops before the holidays. Keep your card tucked into your wallet or purse. If you use a cardholder on your phone case, keep your phone in a safe place and make sure the card numbers are not easily visible. Finally, put your card away right after completing a purchase.

Take immediate action if there are signs of fraud

If you suspect your credit card has been used fraudulently, alert your issuer and financial institution immediately. Your old card will be canceled to prevent additional bogus charges and you’ll be issued a new one so you can complete your shopping. Consider placing a credit freeze on your accounts as well.

Stay safe!

Your Complete Year-End Financial Checklist

As 2021 draws to a close, take a moment to go through this year-end financial checklist to ensure your finances are in order before the start of the New Year.

1. Review your budget

Is your current monthly budget working for you? Are you stretching some spending categories or finishing each month in the red? Take some time to review your budget and make any necessary changes.

2. Top off your retirement plan

Check to see that you are taking full advantage of your employer’s matching contributions for your 401(k). If you haven’t contributed as much as you can, you have until the end of the year to catch up, to a limit of $19,500. If you have an IRA, you have until April 15 to scrape together the maximum contribution of $6,000, with an additional $1,000 if you are 50 years or older.

3. Check your progress on paying down debt

Review your outstanding debts from one year ago and hold up the amounts against what you now owe. Have you shed any debt from one year ago, or is your debt growing? If you’ve made no progress, or your debt has deepened, consider taking bigger steps toward paying it down in 2022.

4. Get a free copy of your annual credit report

The end of the year is a great time for an annual credit checkup. You can only request a free copy of your credit report from all three credit reporting agencies once a year. Get your annual credit report here, and look for fraudulent charges and other signs of possible identity theft.

5. Review your investments and asset allocation

You may need to make some adjustments to your mix of stocks, bonds, cash and other investments to better reflect your personal financial goals and/or the current state of the economy and market.

6. Review your beneficiaries

Has your family situation changed during the past year? If it has, be sure to switch the beneficiaries on your accounts and life insurance policies to accommodate these changes.

7. Review your tax withholdings

Review your W-4 to see if the amount of tax withheld from each paycheck needs to be adjusted. If you’re not a numbers person, ask your accountant for help.

Use this checklist to make sure your money matters are in order before the start of 2022.

All You Need to Know About HELOCs

If you’re a homeowner in need of some cash, look in your own home. You can tap into your equity through a home equity line of credit, or a HELOC. Let’s take a look at HELOCs and why they can be an excellent option for cash-strapped homeowners.

What is a HELOC?

A HELOC is a revolving credit line letting homeowners borrow money against the equity of their home, as needed. Since it’s backed by a valuable asset, a HELOC will generally have a lower interest rate than unsecured debt, like credit cards.

Once you’ve been approved, you can borrow as much or as little as needed during a period of time known as the draw period. That time window generally lasts five to 10 years.

How much money can I borrow through a HELOC?

The amount of money you can take out through a HELOC will depend on your home’s total value, the percentage of that value the lender allows you to borrow against and how much you currently owe on your home.

Many lenders will only offer homeowners a HELOC that allows the borrower to maintain a loan-to-value (LTV) ratio of 80% or lower.

Is every homeowner eligible for a HELOC?

Like every loan and line of credit, HELOCs have eligibility requirements. Exact criteria will vary, but most lenders will only approve homeowners who have a debt-to-income ratio of 40% or less, a credit score of 620 or higher and a home with an appraised value that is at minimum 15% more than what is owed on the home.

How do I repay my HELOC?

Some lenders allow borrowers to make payments toward the interest of the loan during the draw period. When the draw period ends, the borrower will make monthly payments toward the principal of the loan in addition to the interest payments.

For many borrowers, though, repayment only begins when the draw period ends. At this point, the HELOC enters its repayment phase, which can last up to 20 years. During this time, the homeowner will make monthly payments toward the HELOC’s interest and principal.

In lieu of an extended repayment phase, some lenders require homeowners to repay the entire balance in one lump sum when the draw period ends.

How can I use the funds in my HELOC?

There are no restrictions on how you use the money in your HELOC. However, it’s generally not a good idea to use a HELOC to fund a vacation, pay off credit card debt or to help you make a large purchase. If you default on it, you risk losing your home, so it’s best to use a HELOC to pay for something that has lasting value, such as a home improvement project.

If you’re a homeowner in need of some extra cash, consider taking out a HELOC through Olean Area Federal Credit Union. Call, click, or stop by today to get started!

How to Build Up Your Credit from Scratch

Q: I’ve never had a credit card and my credit history is non-existent. I’m ready to build up my credit from scratch. Where do I start?

A: Building a credit history from the bottom up can be tricky business. It may take a while until you see results. But, with time, effort and responsible financial choices, you can build an excellent credit history, which will positively impact your financial health for years to come.

Here are 5 steps you can take to get the ball rolling on your credit file.

1. Visit Olean Area Federal Credit Union

Stop by Olean Area Federal Credit Union to speak to a Lender about opening your first credit card right here. We offer most of our members secured credit cards even when they don’t have a substantial credit history.

2. Open a secured credit card

Secured credit cards are starter cards requiring you to make a deposit of several hundred dollars before you can open a credit line in that same amount. The card issuer will hold this deposit as collateral in case of a missed payment. After eight or 12 months, you will get your deposit back if there is no outstanding balance on your card. You can then close your account and open an unsecured credit card. Secured credit cards are not long-term solutions, but they are great first credit cards since almost anyone can qualify.

3. Open one or several low-balance cards

There are several credit card companies, including Capital One and Credit One, offering cards specifically geared to the new credit card owner. These cards do not require a credit history to qualify, though you may need to prove that you lead a financially responsible life.

4. Use your cards responsibly

It’s not enough to have credit cards open in your name; you need to use them, too. With a starting balance of $200 or so, you’ll have to be careful to spend just a bit each month and keep your credit utilization at less than 30%. You’ll also have to be vigilant about paying your bill in full and on time each month. You can set up an automatic payment, so you never miss a bill.

5. Become an authorized user

If you have a family member or partner who has an excellent credit score and a credit card that they’ve had for a while, ask them about making you an authorized user on their card. This will add the card’s payment history to your growing credit file and can increase your score. Keep in mind, though, that any time you use the card, the primary account holder will be responsible for paying the bill. Also, find out whether the card issuer reports authorized user activity to the credit bureaus, so this step isn’t wasted.

How to Spot A Credit Repair Scam

Credit repair scammers tell you they can make credit repair quick and easy. Unfortunately, when they’re done, your score may still be low, you’ll have lost a nice chunk of change and may even be facing criminal charges.

Here are the warning signs of a credit repair scam:

1. Upfront payment

Under the Credit Repair Organizations Act (CROA), credit repair companies are forbidden to request or receive payment until they’ve completed the services they’ve promised.

2. Big promises

Scammers may claim they can remove negative information from your credit report, even information that is accurate and current. Don’t believe them; no one can do this. They might also promise to boost your score in just a few weeks. This, too, isn’t true. It takes at least 30 days for changes to be evident on your credit report.

3. Offers a “new credit identity”

In these scams, companies promise to create a new credit identity for a fee. After you pay, the company will provide you with a nine-digit number. They may refer to this number as a CPN – a credit profile number or a credit privacy number. Alternatively, they may direct you to apply for an EIN – an Employer Identification Number.

The company instructs you to use this form of ID to apply for credit, telling you it is legal. However, it’s not — and you’ve just been scammed. These companies are selling you a stolen SSN. They walk away with your money and leave you in hot water because you’ve just committed multiple federal crimes.

Falling for a credit identity scam could mean facing fines or prison time.

4. Tells you to dispute accurate information on your credit report

Disputing accurate information on your credit report is illegal.

5. Evasive when questioned

The Credit Repair Organizations Act made it illegal for credit repair companies to lie about your rights and their services. These companies must explain:

A written contract detailing your legal rights
Your three-day right to cancel the contract without charge
The anticipated time it will take until results are evident
The total cost you will pay for their services
Their guarantee

If you’ve hired a credit repair company that hasn’t lived up to its promise, you can choose to sue the company for your losses in federal court. Along with other victims, you can file a class action lawsuit against the company.

Finally, it’s best to report the scam to your local consumer affairs office or to your state attorney general. You can also file a complaint with the Federal Trade Commission (FTC). File your complaint online at ftc.gov/complaint.

Your Complete Guide to Using Your Credit Cards

Using your credit cards responsibly is a great way to boost your credit score and your financial wellness. Here’s all you need to know about responsible credit card usage.

Refresh your credit card knowledge

A credit card is a revolving line of credit allowing the cardholder to make charges at any time, up to a specific limit. Each time the cardholder swipes their card, the credit card issuer is lending money for the purchase. Unlike a loan, though, the credit card account has no fixed term. Instead, the cardholder must make payments toward the balance each month until the balance is paid off in full.

Credit cards tend to have high interest rates relative to other kinds of loans. The most recent data shows the average industry rate on new credit cards is 13.15% APR (annual percentage rate) and the average credit union rate on new credit cards is 11.54% APR.

Pay bills in full, on time

Paying bills in full and on time has multiple benefits:

Build an excellent credit score
Skip the interest charges
Stay out of debt
Avoid late fees
Enjoy rewards from the credit card issuer

Brush up on billing

There are several important terms to be familiar with for staying on top of credit card billing.

A credit card billing cycle is the time between credit card billings. It can vary from 20 to 45 days, depending on the credit card issuer. Within that timeframe, purchases, credits and any fees or finance charges will be added to and/or subtracted from the cardholder’s account.

When the billing cycle ends, the cardholder will be billed for the remaining balance, which will be reflected in their credit card statement.

Credit card bills will also show a payment due date, which tends to be approximately 20 days after the end of a billing cycle. The timeframe from when the billing cycle ends and its payment due date is known as the grace period. When the grace period is over, and the payment due date passes, the payment is overdue and will be subject to penalties and interest charges.

Make sure you read the disclosures for your credit cards to find important information that relates to each particular card.

Spend Wisely

Do:

When making a purchase, treat your credit card like cash.
Remember that credit card transactions are mini loans.
Pay for purchases within your regular budget.
Decrease reliance on credit cards by building an emergency fund.

Don’t:

Use your credit card as if it provides you with access to extra income.
Use credit to justify extravagant purchases.
Neglect to put money into savings because you have access to a credit card.

Debt Consolidation: Not A Silver Bullet, But Still A Good Idea

Using a personal loan to refinance your existing debt can make your debt more manageable. You’ll have one monthly payment at one interest rate instead of many smaller bills due on different days of the month.

Will personal loans work for you?

1. Have I fixed the debt problem?

Think about why you’re in debt. If a medical bill, job loss or some other temporary hardship describes your situation, the fact that you have a job or have paid the medical bill means you’ve solved the problem that caused the debt in the first place.

If, on the other hand, you accumulated debt by overspending on credit cards, a debt consolidation loan may not be the answer just yet. First make a budget you can stick to, learn how to save and gain responsibility in your use of credit. Getting a debt consolidation loan without doing those things first is a temporary solution that can make matters worse.

2. Can I commit to a repayment plan?

If you’re struggling to make minimum monthly payments on bills, a debt consolidation loan can only do so much. It’s possible that the lower interest rate will make repayment easier, but bundling all of that debt together could result in a higher monthly payment over a shorter period of time. Before you speak to a lender, figure out how much you can afford to put toward getting out of debt. Your lender can work backward from there to figure out terms, interest rate and total amount borrowed.

If you’re relying on a fluctuating stream of income to repay debt, it may be difficult to commit to a strict repayment plan that’s as aggressive as you like. You can still make extra principal payments on a personal loan, so your strategy of making intermittent payments will still help. You just can’t figure them into your monthly payment calculation.

3. Is my interest rate the problem?

For some people, the biggest chunk of their debt is a student loan. These loans receive fairly generous terms, since a college degree should generally result in a higher-paying job. Debt consolidation for student loans, especially subsidized PLUS loans, may not make a great deal of sense. You’re better off negotiating the repayment structure with your lender if the monthly payments are unrealistic.

On the other hand, if you’re dealing with credit card debt, interest rate is definitely part of the problem. Credit card debt interest regularly runs in the 20% range, more than twice the average rate of personal loans. Refinancing this debt with a personal loan can save you plenty over making minimum credit card payments.

4. Will a personal loan cover all my debts?

If you have more than $50,000 in credit card debt, it’s going to be difficult to put together a personal loan that can finance the entire amount. It’s worth prioritizing the highest interest cards and consolidating those instead of trying to divide your refinancing evenly between accounts. Get the biggest problems out of the way, so you can focus your efforts on picking up the pieces.

Debt consolidation doesn’t work for everyone, but it can do wonders for many people. The ability to eliminate high-interest debt and simplify monthly expenses into one payment for debt servicing can change a family’s whole financial picture. Gather your account statements and your paycheck stubs, and contact Olean Area Federal Credit Union today!

5 Reasons we Overspend (and How to Overcome Them)

What makes us overspend? Let’s take a look at five common reasons and how we can overcome them.

1. To keep up with the Joneses

When people who seem to be in the same financial bracket as we are can seemingly afford another pair of designer shoes for each outfit, we should be able to afford them, too, right?

Break the cycle: Learn to ignore how your friends and/or peers choose to spend their money and develop a self-image that is independent of material possessions. Let the Joneses keep up with you!

2. We don’t have a budget

When all of our spending is just a guessing game, it can be challenging not to overspend.

Break the cycle: Create and stick to a monthly budget that covers all of your needs and some of your wants.

3. To get a high

Research shows that shopping and spending money releases feel-good dopamine in the brain, just like recreational drugs.

Break the cycle: There’s nothing wrong with spending money to feel good, so long as you don’t go overboard. Try putting some “just for fun” money into your budget so you can make that feel-good purchase when you need to do so without letting it put you into debt.

4. Misuse of credit

Credit cards offer us incredible convenience, but they also offer us a gateway into deep debt. Research shows that consumers spend up to 18% more when they pay with plastic over cash.

Break the cycle: When shopping in places you tend to overspend, use cash and you’ll be forced to stick to your budget. You can also use a debit card with a careful budget so you know how much you can responsibly spend.

5. Lack of self-discipline

Sometimes, we just simply lack the discipline not to exchange immediate gratification for long-term benefit.

Break the cycle: Define your long-term financial goals. Create a plan for reaching them through small and measurable steps. Before giving in to an indulgence you can’t really afford, remind yourself of your long-term goals and how much longer your timeframe will need to be if you spend this money now.

Why Does My Credit Score Matter?

Your credit score is an indicator of your financial wellness and responsibility. We have outlined how credit scores are calculated, why it matters and steps to take to improve your score.

How is my credit score calculated?

The three major credit bureaus in the U.S. collect and share information on a person’s credit usage with potential lenders and financial institutions. Most lenders use this information and the FICO scoring model to calculate credit worthiness. Some use the VantageScore model instead. Both scoring models look at the following factors when calculating credit scores:

The age of your credit. A longer history of credit usage boosts your score.
The timeliness of your bill payments. Chronic late payments can drastically reduce a score.
The ratio of outstanding debt to available credit. The VantageScore formula views having a lot of available credit as a liability, while the FICO formula considers this a favorable point.
The diversity of your credit. Lenders want to see that you have several kinds of open credit.
The trajectory of your debt. Are you constantly accumulating new debt, or working toward paying down your existing debt?
Your credit card usage. Financial experts recommend having several open and active credit cards to boost your score.

How does my credit score affect my life?

Here are some ways your credit can affect your life:

Loan eligibility. Lenders check scores to determine whether you will be eligible for a loan. A poor credit score can keep you from buying a house or car or getting other types of loans.
Interest rates on loans. A higher score can get you a lower interest rate on a loan, and a poor score can mean paying thousands of extra dollars in interest over the life of the loan.
Employment. Many employers look at the credit scores of potential employees as part of the hiring process.
Renting. Lots of landlords will run credit checks on new tenants before signing a lease agreement.
Insurance coverage. Most insurers will check your credit before agreeing to provide you with coverage.

How to improve your credit score

Pay your bills on time. If you find timeliness to be a challenge, consider automatic payments.
Pay more than the minimum payment on your credit cards. This shows you’re working on paying down your debt and can help improve your score.
Pay your credit card bills before they’re due. This way, more of your money will go toward your outstanding balance instead of toward interest.
Settle outstanding medical bills. These can significantly drag down your credit score.
Consider debt consolidation. If you’re paying interest on multiple debts each month, you may benefit from transferring your debt to a single credit card that offers an introductory interest-free period or from taking out an unsecured loan.

What School Doesn’t Teach You About Money

With the new school year either here or just around the corner, it’s time to fill your shopping carts with No. 2 pencils, protractors and all the goodies the kids will lose by the second day of school. If they’re headed off to college, it can be even more exciting. But, instead of needing you to replace their pens on day two, your college-aged child will probably be calling to ask for money by then.

It’s such a ritual that, at this point, many of us don’t really question it. But how much do our kids actually know about money? You might want to only include the lessons you taught them, because their school probably didn’t teach them much at all.

Common core and other national guidelines don’t include requirements for teaching budgeting skills, how to balance a checkbook, or even explanations of basic concepts such as credit, loans or mortgages. Basically, the last time your children learned about money at school, it probably involved finding out how many apples and oranges they could buy in some middle school math word problem.

We talked to some credit union members about the lessons they want to pass on to their kids, and below you’ll find some of our favorite lessons to teach your kids.

Pay yourself first

No one else is going to make you a financial priority, so don’t make them your financial priority.

If you want to know if you can afford something, check your budget. When you have to check your checking account, you can’t afford it.

If you reconcile your accounts every month, you’ll have a pretty good idea how much is actually in each account. Plan ahead. Make a budget. Execute the plan by sticking to that budget.

Take risks while you’re young

You can afford to be more aggressive with your retirement and college funds while you have plenty of time to make it back up, so don’t be afraid to push those funds a little bit. That said, not saving for retirement is not a risk. It’s just a bad idea.

Make sure the Joneses are keeping up with you

It’s easy to get lost trying to compete with your peers and almost as easy to ignore those consumer pressures entirely. But what about the third option? Instead of ignoring their financial situation, check in every now and then to see if they need help. Our communities are better when we care about each other.

Whether your kids are in diapers or their kids are wearing them, it’s never too early or too late to teach financial literacy. Make sure you’re instilling the right lessons, and check back in with Olean Area Federal Credit Union, because we’ve always got plenty of resources for young people to learn the lessons they aren’t getting in math class.