Archive for the ‘ Youth ’ Category

Types of IRA’s for Children

girl with money

There are two different types of IRAs that are suitable for children: traditional and Roth. The primary difference between traditional and Roth IRAs is when you pay taxes on the money that you contribute to the plan. With a traditional IRA, you pay taxes when you withdraw the money during retirement (at your then-applicable tax rate). A traditional IRA contains pre-tax earnings. With a Roth IRA, you pay taxes when you put the money into the account, so it contains earnings after tax.

The money grows tax free while it’s in either a traditional or Roth IRA. But the benefit of a Roth is that when the child withdraws the money many decades from now, he or she won’t have to pay income tax on it. What’s more, there are no required minimum distributions (RMDs) on the money. Of course, these rules may change in the next 40 years, but that’s where they are now.

If you claim your child as a dependent, he may be required to file an income tax return of his own if his income exceeds a certain amount set by the IRS ($6,300 for 2017). If your child earns less than this amount, she is likely in a 0% income tax bracket and she probably won’t benefit from the up-front tax deduction associated with traditional IRAs.

Because many kids don’t earn enough money to benefit from the up-front tax deduction associated with traditional IRAs, it makes sense in most cases to focus on Roth IRAs. In general, the Roth IRA is the IRA of choice for minors who have limited income and who, therefore, would not benefit from a deductible traditional IRA.

Starting an IRA for your child can be a wonderful thing. At their young age, compounding kicks into high gear due to the long time horizon. And usually they will be in a low, or even zero tax bracket so the Roth is normally the best choice.

If a child keeps [a Roth] until age 59-1/2 (under today’s rules), any withdrawal will be tax free. In retirement, he or she would likely be in a much higher bracket, so  would effectively be keeping more of his or her money.

Benefits of IRAs for Kids

A single $1,000 IRA contribution made at age 10, for example, could grow to $11,467 over 50 years, assuming a conservative 5% average annual growth rate. Contribute $50 each month, and the account might grow to $137,076 (with the initial $1,000 contribution and the same hypothetical growth rate of 5%). Or double the contribution to $100 each month and the account could reach $262,685. As children make more money and eventually become adult earners, their annual contributions are likely to be higher, and the IRA could grow correspondingly. Setting aside money each month or year for an IRA – even if the contributions are small – helps your child develop awareness and healthy financial habits.

Another benefit of IRAs is that your child may be able to tap into the account for qualified higher education expenses and up to $10,000 towards a down payment on a first home without penalty. With a Roth IRA, you can withdraw any contributions, but not the investment earnings, for any reason without tax or penalty.

Information courtesy of: Investopedia.com

Visit www.citizensmn.bank or contact Citizens Bank Minnesota at 507-354-3165 to find out more information about the great rates we offer on our IRA CD’s!  The future starts NOW!

Halloween Safety Tips

halloween safety picIt’s almost that time of year when children look forward to trick-or-treating, dressing up in costumes, decorating and obtaining more candy than they can possibly eat. As fun as it is, Halloween is also a deceptively dangerous night, and preparations for a safe and enjoyable celebration should begin long before Halloween night.
SELECTING A COSTUME
• Select a costume that doesn’t risk slips, trips or falls. Costumes should not drag on the ground.
• Wear comfortable shoes for walking. As tempting as it may be to wear shoes themed with the costume – high heels for Cinderella come to mind – they can be unsafe for youngsters to navigate.
• Choose a bright costume that motorists can see.
• Place reflective tape on costumes and trick-or-treat bags for increased visibility.
• Wear costumes with flame resistant fabrics (such as nylon and polyester) or look in the label for the notation, Flame Resistant. Flame resistant fabrics resist burning and should extinguish quickly.
• Avoid outfits with big, billowy sleeves and flimsy materials that could contact candles.
• Test any makeup on the skin beforehand, and don’t use it if there is an allergic reaction.
• Beware of accessories that could injure a child. Choose soft swords, for example, and avoid items with sharp edges.
• Be careful when selecting masks, scarves and decorations that nothing obstructs a child’s vision.
PUMPKIN CARVING
• No matter how much they plead, don’t let small children handle knives and carve pumpkins. Instead, have them draw their design with markers and let an adult do the carving.
• To avoid the possibility of a fire, use a flashlight or glow stick instead of a candle to light your pumpkin. If you cannot avoid using a candle, a small votive candle with a holder is safest.
HOME SAFETY AND DECORATIONS
• Outside your home, use flameless candles or keep burning candles and jack-o’-lanterns away from landings and doorsteps, where trick-or-treaters’ costumes could brush against the flame.
• Keep your home safe for visiting trick-or-treaters by removing from the porch and front yard anything a child could trip over such as leaves, garden hoses, toys, bikes and lawn decorations.
• When indoors, keep candles and jack-o’-lanterns away from curtains, other decorations and other items that could ignite. Do not leave burning candles unattended.
• Whether indoors or outside, use only decorative light strands that have been tested for safety by a recognized testing laboratory. Check each set of lights, new or old, for broken or cracked sockets, frayed or bare wires or loose connections. When in doubt – discard.
• Don’t overload extension cords.
• Restrain pets so they do not inadvertently jump on, scratch or bite a trick-or-treater. It may be best to shut your pet away from the commotion; some animals find Halloween especially spooky.
TRICK-OR-TREATING
• An adult should always accompany young children on their neighborhood rounds.
• Obtain flashlights with fresh batteries for all children and their escorts.
• Make sure cell phone batteries are fully charged. If older children are trick-or-treating by themselves or in groups, review with them the geographic boundaries where they may go.
• Remain on well-lit streets and always use the sidewalk. Walk facing traffic. Avoid darting from house to house in the middle of the street – cars aren’t expecting you to be in the middle of the street.
• Notify law enforcement authorities immediately of any suspicious or unlawful activity.
Happy trick-or-treating, and be safe!

Article courtesy of: Cincinnati Insurance Company

Renters Insurance For College Students

Renters Insurance for College Students

Renters Insurance Should Be Considered For College Students Living on Their Own
College students renting an off-campus apartment or house while away at school should consider purchasing renters insurance to protect their personal property, such as a computer, television, stereo, bicycle or furniture in the event that it is damaged, destroyed or stolen.
Even if a student is a dependent under his or her parent’s insurance, the student’s personal property may not be covered. Parents should check their policy or contact their insurance agent to see if renters insurance is right for their son or daughter who is away at school.

What is Renters Insurance?
Renters insurance protects your personal property against damage or loss, and insures you in case someone is injured while on your property. If you live in a rented apartment, house or condominium, your landlord’s insurance does not cover your personal property in the event that it is stolen or damaged as a result of a fire, theft or other unexpected circumstance.
College students living in off-campus housing are ideal candidates for needing renters insurance, since many students bring thousands of dollars’ worth of personal items, such as electronics, a computer, textbooks, clothes, furniture, and a bicycle, with them to school. It is the renter’s responsibility to provide coverage for these valuable items.

Basic Options
Most renters’ insurance policies provide two basic types of coverage: personal property and liability. Personal property coverage pays to repair or replace personal belongings if they are damaged, destroyed, or stolen. This is the most commonly purchased renters’ policy. Liability insurance provides coverage against a claim or lawsuit resulting from bodily injury or property damage to others caused by an accident while on the policyholder’s property.

Shop for the Right Coverage
Another important factor to look for when shopping for renters insurance is “actual cash value” vs. “replacement cost” coverage.
Actual cash-value coverage will reimburse the renter for the cost of the personal property at the time of the claim, minus the deductible. It’s important to account for depreciation when considering this coverage option. For example, if a stereo system were stolen from an apartment fi ve years after the stereo was purchased, the policyholder would be reimbursed for the current value of the system.
Replacement cost coverage, on the other hand, will reimburse the full value of the new stereo system after you purchase the new system and submit your receipts. While the up-front cost is greater, you are more likely to receive accurate compensation for your possessions.

Parents’ Homeowners Insurance
As a parent with your own homeowners’ policy, you may want to contact your agent and ask if your child will be covered while they are away at school. Some companies might still cover your child’s belongings under your policy depending on their age and student status. However, you will still be responsible for your deductible under your policy.
Other Points of Interest Regarding Renters Insurance
When a claim is reported, the insurance company will ask the policyholder for proof of purchase for all items reported on the claim. A comprehensive list of possessions, including purchase prices, model numbers and serial numbers, will suffice. It also is a good idea to take photos or video footage of any personal possessions for documentation, making sure it is stored in a secure, off-site location.

Article Courtesy Of: Fairmont Farmers Mutual Insurance Company

Investment and Insurance products:

  • Are Not Insured by the FDIC or any other federal government agency
  • Are Not deposits of or guaranteed by a Bank or any Bank Affiliate
  • May lose value

2017 Citizens Scholarship Winners

Danielle Hogue, a home school graduate, and Levi Stelljes, a graduate of Minnesota Valley Lutheran High School, were recently presented with the Citizens Bank Minnesota’s seventeenth annual scholarship awards.  These scholarships are part of the Community Bankers Scholarship Program TM.  Both of these students received a $1,000.00 scholarship that is renewable for a potential value of $4,000.00 over four years of post-secondary education.

Amy Denn, a graduate of Madelia High School, and Vivian Riggin, a graduate of Lakeville South High School, were the recipients of a $500.00 Citizens Bank Minnesota scholarship.  The scholarships are offered through a random drawing to graduating high school seniors from the New Ulm and Lakeville area who have completed the Citizens Real Life Skillz online classes.

Each year, Citizens awards two or more high school seniors with scholarships. Applicants must be graduating high school, plan to attend a four year university, have an active Citizens checking account and complete the Citizens Real Life Skillz courses. The scholarship program was developed to support our belief in the youth and their potential to make a difference in our community. Citizens is proud to invest in their futures by promoting education and excellence.

Grad photo Hogue, Danielle

 

Danielle, daughter of Jeff and Shelly Hogue, will be attending Bethel University this fall, pursuing a degree in nursing and psychology.

 

 

Grad phot Stelljes, Levi

 

Levi, son of Ross and Laura Stelljes, will be attending Martin Luther this fall, pursuing a degree in secondary math and elementary education.

 

 

Grad photo Denn, Amy

 

Amy, daughter of Mark Denn and Lori Denn, will be attending Augustana University – Sioux Falls, SD this fall, pursuing a degree in biology/pre-med.

 

 

 

Grad photo Riggin, Vivian

 

Vivian, daughter of Julie and Bill Shea, will be attending Minnesota State University, Mankato this coming fall, pursuing a degree in elementary education.

 

 

 

For more information about the scholarship visit: https://www.citizensmn.bank/personal/real-life-investors

By: Lori Dummer, Marketing Assistant/Youth Club Coordinator

Citizens donates $3,000 to ISD #88 Greenhouse Project Fund

greenhouse-press-release

Citizens Bank Minnesota proudly presents a check for $3,000.00 to the ISD #88 Greenhouse Project Fund at the New Ulm High School. Funds will be used to expand and develop their Greenhouse. Pictured in the photo are members of the FFA Chapter, NUHS Ag Teacher Jeff Nelson, Citizens staff Tim Hoscheit (Sr. Vice President), Lou Geistfeld (President), Rose Wendinger (Asst. Vice President), Pat Brennan (Vice President) and NUHS Ag Teacher Kelsey Brandt.

Do I Need Renters Insurance in College?

renter-insurance-in-college

Updated: July 2016

When you’re packing for college, you may be thinking about your class schedule and late night pizzas with friends. Someone making off with your laptop or a dorm fire are probably not what you’re envisioning about the campus experience. But since you may be bringing some expensive stuff with you — a television, speakers, clothing and a smartphone — it’s a good idea to make sure these things are protected before you leave home, just in case.

Whether you’re living in the dorm or an off-campus apartment, it’s important to have coverage for all those things that help you keep up with classes and make your living space feel like home. How to help protect your stuff, though, typically depends on where you’re living.

Dorm Life

If you’re living in a dorm or other campus housing, your belongings may be covered under your parents’ homeowners or renters insurance policy. You’ll want to check with your agent to make sure, but the National Association of Insurance Commissioners (NAIC) says that students who are younger than 26 and living on campus may be covered through their parents’ policy.

It can be a good idea to know the policy’s coverage limits for personal property. The Insurance Information Institute(III) says some policies limit coverage for belongings while they are away from the policyholder’s home. This is often referred to as “off-premises coverage.” For example, if your parents’ policy provides $100,000 worth of coverage for belongings, but limits that coverage to 10 percent for items that are off-premises, it may provide up to $10,000 for items away from their home, including belongings you bring to school.

It’s also important to note that certain items, such as a laptop, may have coverage limits. If the policy’s limits aren’t enough to cover the items you’ll be bringing to school, the III says your parents may be able to add scheduled personal property coverage, sometimes referred to as a “floater,” to their homeowners or renters insurance policy to help cover certain valuable possessions.

Off-Campus Housing

If you’ll be living in off-campus housing, the III cautions that your parents’ insurance will probably not extend to any belongings you bring with you (although you’ll want to check with your agent to be certain). Your own renters insurance policy may be a good way to help protect your belongings should they be stolen or damaged by a covered loss. (Covered events are often described as “perils” in insurance terms. Read your policy to learn what risks it may cover, such as theft or fire.)

A renters policy will also likely provide liability coverage, which may help prevent you from paying out of pocket if you are found legally responsible for someone else’s injuries or accidental damage to their property (including your landlord’s).

The III recommends asking your agent about coverage limits, as well as whether you may benefit from additional coverage for certain valuables.

Hopefully you and your stuff stay safe and sound while you’re running to and from classes, but it may be a good idea to keep a home inventory — it can be a big help if you ever need to file a claim. Knowing you have coverage for your stuff can bring some peace of mind and help you focus on a great college experience.

Article courtesy of: http://www.allstate.com

 

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