Zelle Basics

Zelle is a money-transferring service just like Venmo and PayPal. The main difference is that Zelle is housed in the websites and apps of credit unions and banks. To use Zelle, you log into your financial institution’s site or app and then transfer/receive the money. To use Venmo or PayPal, you must log into those apps.

Two Scams

The most popular Zelle scam starts with what appears to be a message or phone call from your credit union. The credit union message typically asks you to contact it to verify a Zelle transfer. If you call the number, a scammer will then ask you to make a transfer to “return the funds” because (obviously) this wasn’t an authorized Zelle action. That transfer, now authorized, will send money to the scammer.

Another Zelle scam operates in much the same way, only this one starts from a fake utility company. The message will claim that the company didn’t receive your payment and to contact it to avoid a shut-off. Then, when you call the fake number and authorize a Zelle payment, once again the money goes to the scammer.

Protect Yourself

The best way to protect yourself from Zelle scams is to never send money to a company or person that you don’t know. If you are contacted by someone about a Zelle transfer, do not take action. Instead, hang up and contact your credit union or utility company directly and ask about transaction activities. The bottom line? Be vigilant. If something seems suspicious, it usually is.

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Monthly Expenses

Quite simply, you need to make sure that you earn more than you spend. If you find yourself struggling to make it to the end of a pay period, it’s time to sit down and see where your money is going. As you review your checking account statement and credit card bills, look to see where you can make adjustments. One common pain point is ordering takeout and restaurant dining, which has become even more expensive in recent years with soaring inflation. Another place you may be able to cut back is on your streaming subscriptions. The Consumer Financial Protection Bureau offers a budget template calendar along with spending and savings trackers to help you get started.

Emergency Fund

Our lives can take twists and turns we never see coming, from major illness to divorce to job loss. That’s why it’s so important to make sure you have three to six months’ worth of living expenses tucked away in a savings account so you have a built-in buffer if something unexpected happens. And yes, it can be easier said than done. One way to get a jump start on building an emergency fund – or a rainy day account – is to use your tax refund to get it started.

Some people start a side hustle and pour that income into a savings account. You can also take your next raise, or bonus, and funnel that extra money into a separate account. And when it comes to how much you need, there is some wiggle room. Someone who is single with no children or others to support can probably get away with saving a little less (on the three to four months side) compared to someone solely supporting a family of four or more who needs to have a full six months in their emergency stash.

Pro-tip: Once you save enough to create a cushion, get to work paying off any high-interest debt.

Retirement Savings

None of us are getting any younger and many of us may live much longer than we ever expected. That’s why it’s vital to intentionally plan for our futures by saving for the years ahead. A good rule of thumb is to aim to save 15 to 20% of your monthly salary for retirement, which includes any employee contributions through 401(k)s or other plans. The folks at AARP have a retirement calculator you can use to get an idea of where you stand. And whether you are nearing your golden years or just getting started, check out the Social Security Administration’s website at ssa.gov to create an account and learn more about your estimated benefits.

Pro-tip: If your employer offers a retirement account match, make sure you are putting in enough to grab all the matching dollars you can. Unsure? You can check in with your HR department to find out whether you are investing enough to get the full amount.

Insurance

If you have children or others who depend on your paycheck, then you need life insurance. Health insurance is also non-negotiable along with disability coverage, especially if it’s offered by your employer. While you often need to supplement employersponsored life and disability insurance, it tends to be affordable and typically worth the investment. And when it comes to life insurance, a term life policy often covers the needs of most people. Term life insurance is a policy that ends at a set point in time. It includes a death benefit, with no investment attached, and when the term ends, the coverage ends. Term life is usually much less expensive than other options. You can use the calculator at insure.com to see how much coverage you should consider at this stage of your life.

With reporting by Casandra Andrews

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ARE YOU MAKING THESE FINANCIAL MISTAKES?

Some common money missteps to avoid

 It can be easy to make mistakes with money. It’s easy to make mistakes with anything. However, with money, there are certain pitfalls that are easier to avoid than others. Here are some common money mistakes that can be avoided with just a bit of work.

Buying Too Much House

Just because you got approved for a huge mortgage doesn’t mean you need to use it all. Think carefully before buying a house that might end up breaking the bank. You don’t want to funnel all of your cash just to keep the lights on.

Not Investing

You simply have to invest to ensure you have some retirement nest egg. Even the highest-yield savings accounts can’t match the returns of the market over time. If you can put even a little bit into investments, you’ll be happy you did when the time comes to step away from work.

Paying for Things You Don’t Use

Everyone has subscriptions that they never or rarely use. Those little fees add up over time. Go through your subs and cut the ones you don’t need.

Not Tracking Money

You have to use a budget. It’s not fun, but it’s necessary. If you don’t track your spending, earnings and savings, you will most likely eventually run into problems.

Forgetting to Check Your Credit Report

You can check your credit report three times per year (one from each credit bureau) for free. Do it. If there are inaccuracies on your report, it will drag your credit score down. Get them fixed and watch your credit score jump.

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