Winter 2023 Newsletter

Another year has ended, and we now look forward to 2023. Over the past two years, we have experienced some amazing changes. In 2020, we entered a worldwide pandemic that greatly impacted our workforce and supply chain. The Federal government responded by injecting literally trillions of dollars into the U.S. economy to help provide families and businesses the funding to weather the impact of the economic slowdown. Although some help was needed, it soon became clear that the impact of the pandemic and the resulting stimulus caused our workforce to fall to a point that there are now more jobs available than people to fill them. This caused the supply chain problems to accelerate to the point that demand (funded by stimulus dollars) significantly outpaced supply. This, in turn, has caused the rate of inflation to reach levels last seen in the 1980’s. The Federal Reserve is keenly aware of this situation and will continue to tighten their policy stance until the economy ultimately moves into a recession. We are beginning to see the impact of rate hikes as home sales have slowed nationwide and leading economic indicators are confirming the beginning of a slowdown.

I want to take this time to thank all our loyal customers and dedicated staff who have helped NebraskaLand Bank grow to just under $1 billion in total assets over the past 24 years. I am excited to celebrate our 25Th anniversary on May 14, 2023. It is hard to believe that it has been that many years ago that a handful of brave employees came together to start this organization from scratch. It took a dedicated staff and customers who believed in us to make this happen. I could not be more thankful!

As many of you know, I was appointed to the Nebraska Legislature on February 23, 2022, and subsequently elected to a four-year term that begins on January 4, 2023. Although this will require me to spend more time in Lincoln, the magic of technology has allowed me to stay connected throughout the session. In 2023, the Legislature will hold a 90-day session. Even during this time, I will stay in my current role at the Bank and remain dedicated to its success. I will continue to rely on the outstanding work by our amazing staff and cannot say enough about the talented team that we are fortunate to have. They have been doing the heavy lifting for many years now and are fully capable of keeping our momentum going.

In closing, I want to say again how thankful I am for everyone who has contributed to our growth over the years. I also want you to know that we will continue to maintain the values that got us to this point and to guide us as we begin the next 25 years. Providing great personal service and appreciating every customer who comes through our doors will always be our priority.

If you have any questions or concerns, please feel free to contact me at any time.

How to Pick the Best Savings Option For You

You know it’s wise to save for the future, but how do you know where to put your money? (Not under your mattress, obviously.)

First, let’s consider the options:

• Savings Account: This is the simplest option. It’s a safe place to hold money you don’t plan to spend right away but want easy access to. You can make withdrawals and deposits, and you’ll earn a variable interest rate, though it’s lower than other savings options.
• Money Market Account (MMA): This account pays a slightly higher variable interest rate than a savings account, and you can still make withdrawals and deposits, giving you easy access if needed. However, there’s usually a higher minimum initial deposit amount required to earn a higher interest rate than a savings account.
• Certificate of Deposit (CD): A CD offers a fixed interest rate that is usually higher than that of a savings account or MMA. The difference is you pick a term you are willing to hold the funds in for and you will earn a fixed rate for the specific term you select. Typically the rate is higher the longer you’re willing to leave your money in the account for – but if you make a withdrawal prior to the maturity date, you’ll pay a penalty. Some savers consider this a benefit, however, because it helps them avoid the temptation to spend their savings earlier than planned.
• Investment Account: This is a riskier – but potentially a higher-earning – account. It allows you to buy and sell stocks, bonds and mutual funds. While the other savings options are FDIC insured, investment accounts provide no protection against a loss in value. There are two main types of investment accounts: retirement and brokerage. With a brokerage account, you pay capital gains taxes when you sell an investment for a gain, unlike an Individual Retirement Account (IRA), which offers tax advantages. However, a retirement account comes with limits on contributions and on when you can withdraw funds. Another investment account option to consider is the 529 college savings plan if you’re saving for a child or grandchild; this account also offers tax advantages but comes with some restrictions on use.

Next, let’s look at how to pick the best option for you:

• Decide the purpose of your savings. For example, is the money saved for a down payment on a house within the next five years, for retirement decades from now or for a child’s college tuition?
• Consider interest rates. You’ll receive a higher interest rate if you’re OK with restrictions on usage or you’re not adverse to risk.
• Check for fees. There may be a fee for letting your balance fall below the minimum or for withdrawing your money too soon.
• Determine when you’ll need the money. Do you need easy access to it, or can you leave the money untouched for months or years to achieve a higher interest rate?
• Assess your risk tolerance. Remember that you can lose money with an investment account, but the risk may be worthwhile to gain a higher interest rate.

Whichever account you choose – or likely a mix – we’re here for you with knowledgeable representatives, superb customer service, competitive rates and low fees. Take the first step toward a brighter financial future by opening an account or contacting us with questions!

Sources:
https://www.businessinsider.com/personal-finance/how-to-choose-a-savings-account
https://www.forbes.com/advisor/banking/what-is-a-savings-account/
https://www.investopedia.com/terms/m/moneymarketaccount.asp
https://www.investopedia.com/terms/c/certificateofdeposit.asp
https://www.forbes.com/advisor/investing/what-is-a-brokerage-account/