We are keeping a close eye on the "Heartbleed" bug you may have heard about. The vendor we use for Online Banking has completed a preliminary assessment and has not discovered any vulnerability. We will be sure to keep you updated should anything to the contrary be discovered. Rest assured that we are doing everything we can to help ensure that your information is safe.

It is always a good practice to use unique passwords for all of the online services you access. If your GCF Online Banking password has also been used with a different service, we do recommend that you change your Online Banking password at this time.

If you currently utilize GCF’s online banking EXPRESS TRANSFER function to make your loan payments, this service will be temporarily unavailable from April 25, 2014 through June 9, 2014. As an alternative to this temporary inconvenience, you can do one of the following:

  • Contact 1-877-589-6600 ext. 320 or 368 between the hours of 9:00 a.m. and 5:00 p.m., Monday through Friday, to manually complete the transaction.
  • Mail a check to Investors Bank, 101 Wood Avenue South, Iselin, NJ 08830.
  • Sign up for GCF’s online bill payment system and set up a monthly payment to be sent to Investors Bank.

Fast Access

GCF Bank is now part of the Investors Bank family!

Tuesday, December 13, 2011

Edition #641

Today's Highlights:

Past issues of GCFlash:

December 6, 2011 Edition #640

November 29, 2011 Edition #639

November 22, 2011 Edition #638

November 15, 2011 Edition #637

Looking for articles from a past issue of GCFlash not listed above? Enter keywords into our Site Search! Find archived articles prior to August 2009 in our Knowledge Base.

Weekly Spotlight:

Only 11 shopping days 'til Christmas! Give the gift that's always the right style, the right color, the right choice. A GCF Visa Gift Card is always the perfect gift for any occasion. Stop into any GCF branch to purchase a GCF Visa Gift Card for someone special on your holiday shopping list!

Now available at
GCF Bank!

Our Current Rates:

For a listing of our current deposit and loan rates, click here.

Today's National Market Rates
December 13, 2011 6 Mo Ago
1 Yr Ago
5 Yrs Ago
Dow Jones Industrial Average
(Up 377.43 or 3.26% since 12/31/10)
11,954.94 (-0.55%) 11,952.97 11,428.56 12,317.50
S&P 500
(Down 31.91 or 2.54% since 12/31/10)
1,225.73 (-0.87%) 1,271.83 1,240.46 1,413.21
(Down 73.60 or 2.77% since 12/31/10)
2,579.27 (-1.26%) 2,639.69 2,624.91 2,432.41
10 Year Treasury Bond Yield 1.96% 2.99% 3.28% 4.58%
British Sterling 1.5486 1.6221 1.5797 1.9619
Euro 1.3033 1.4340 1.3221 1.3246

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1st Flash

Savings Bonds Go Paperless

U.S. Treasury securities date back to 1776 as marketable securities. They were subject to market fluctuation.

It was almost 160 years before then-Treasury Secretary Henry Morganthau, Jr. introduced a brilliant idea. He suggested making non-marketable securities available in small denominations at a fixed interest rate and redemption schedule. They would be tailored to the small investor.

Early savings bonds were called "baby bonds." They were issued from 1935 to 1941 in denominations ranging from $25 to $1,000. These baby bonds sold at 75 percent of face value and paid 2.9 percent interest when held for their full 10-year maturity.

These Series A to D bonds were sold through post offices. Marketing was conducted through direct mail campaigns and magazine advertising.

They were a hit. Approximately $4 billion of these bonds were sold over the course of this program, with the last maturing in 1951.

As the world prepared war, new need arose. The U.S. faced rapidly-expanding debt and inflation was growing. A larger effort was needed to fund our country's efforts.

Introducing the Series E bond. And the beginning of an all-out marketing campaign.

The national volunteer program coordinated our nation's financial institutions, community leaders, volunteer committees and the advertising and communications media to promote the new bond. The program was a success for more than 60 years.

The Series E bond was originally issued for a fixed term of 10 years, but continued to earn interest for 30 or 40 years, depending on when it was purchased. They were sold until 1980 when they were replaced by the current Series EE bond.

Beginning January 1, 2012, savings bonds are taking on a whole new look. No longer will you be able to purchase a piece of paper to stuff in a gift card. They're going paperless!

Purchase bonds directly from the Treasury Department's website. You won't be able to buy them at your financial institution.

Individuals will need a TreasuryDirect account to purchase Series EE and I electronic savings bonds. Just point your browser to and select the Open an Account link.

It's easy to open an Individual TreasuryDirect account. All you need is a taxpayer identification or Social Security number, a checking or savings account, an email address and a U.S. address of record.

Your account also enables you to manage and redeem these bonds. You'll be able to convert existing paper savings bonds to electronic, enroll in a payroll savings plan to purchase electronic bonds and invest in other Treasury securities. These include bills, notes, bonds and TIPS (Treasury Inflation-Protected Securities).

You can continue to redeem your paper bonds at financial institutions once matured. Replacements for lost, stolen or destroyed bonds can be reissued in paper or electronic form.

The recipient of a gift savings bond must have a TreasuryDirect account before the bond can be delivered. You can hold it in the Gift Box area of your own account until theirs is setup.

Eliminating paper bonds is expected to save taxpayers $70 million over the first five years.

On The World Wide Web

Coalition to Salute America's Heroes provides emergency aid to severely injured troops and their families. They offer several ways you can help. Start by visiting their website.

Santa wants to send a video message to every kid. But he needs your help. Visit him here to make sure your child is included.

Charity scams are hot during the holiday season. Learn which are legitimate and find tips on holiday giving at this site.

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2nd Flash

Year End Financial Tune Up

As the year draws to a close, many of us will look ahead and plan for the coming year. Different events trigger each of us into action. For some, it's wrapping the last Christmas gift.

For me, it's the annual Army/Navy game and awarding of the Heisman Trophy that brings realization of how few days remain on this year's calendar.

And then all those annual lists are posted far and wide. We have the top ten memorable moments, ten news events that changed the world, ten top moments in sports, ten celebrity deaths, ten weather events and so on. We see enough 1s and 0s to satisfy the appetite of any binary code addict.

So without further delay, may I present to you the Top Ten Year End Financial Tips as chosen by this writer. No huge committee oversight to clog down this process.

  1. Take your required minimum distribution from your IRA. Retired individuals age 70-1/2 or older face a 50 percent excise tax on the amount they should have withdrawn if it isn't taken in a timely manner. If this doesn't apply to you, make sure your retired loved ones don't overlook this requirement.
  2. Is there a balance in your Flexible Spending Account? Any money left in at the end of the calendar year is forfeited unless your plan has implemented the new extension provision. Stock up on over-the-counter medicines you might need next year, schedule doctor appointments or visit your dentist to use up your account balance.
  3. If you're self-employed, consider making business-related purchases now. Not only will you maximize this year's deductions but you can take advantage of holiday sales and save even more money.
  4. Year-end charitable donations in the form of cash, property or appreciated stock will help maximize itemized deductions on your 2011 federal tax return. Pay as many tax-deductible expenses as you can, such as medical bills or property tax.
  5. Make your IRA or 401(k) contributions. If you haven't already reached the maximum, you can contribute $16,500 to your 401(k) and $5,000 to your IRA before year end. Those over 50 can contribute an additional $5,500 to your 401(k) and $1,000 into your IRA. You have until April 16th for your IRA, but why wait? It only puts you behind for next year.
  6. Look back at 2011. Did you reach your financial goals? Where did you come up short? This is a good time to review your budget and make whatever changes are necessary to keep you headed in the right direction.
  7. Take advantage of tax provisions that expire at the end of this year. Some may be renewed, but Congress is still haggling over this. Deductions set to expire include classroom expenses for teachers, mortgage insurance premiums, sales taxes and tuition.
  8. Plan related expenses in the same year. Some deductions have to exceed a certain percentage of your income to qualify. For medical expenses, it's 7.5 percent. Job expenses and miscellaneous expenses must exceed 2 percent of your income. If you're close in one area, get new eyeglasses or buy new work tools before year end. Otherwise, wait until January when you can start compiling with next year's expenses.
  9. Do you expect your income to go up in 2012? You may want to maximize deductions by delaying purchases for a time when you're in a higher tax bracket. Alternately, if you expect to earn less in 2012 you may want to use those deductions to lower your income now.
  10. Were you married, divorced or widowed in 2011? Did you have a child? These life-changing events require adjustment. And financial planning is one area that needs attention. Your tax situation will change. Learn now how you will be impacted to reduce your tax shock come April 16th.

Tip of the Week

Holiday hoaxes abound. Among scammer favorites are fake websites created to resemble legitimate shopping sites. Email greeting cards with malicious links entice recipients to click to retrieve their card. Legitimate card sites direct you to their website and include a confirmation code to view your card.

Don't follow the links included in an email from the U.S. Postal Service or other courier service. Delivery details or undeliverable package links can take you to scammers. When in doubt, call the service using a phone number you located yourself.

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Financial News

Two Retirement Rules of Thumb:

I am often asked how much one needs to retire. This is very likely one of the most often asked questions in finance. And because the prudent answer is "it depends," whole industries of consultants and pundits have emerged to try to assist in the answer (for a fee, of course). But isn't there a simple "rule of thumb" to be guided by? Yes there is, so read on.

Some years ago a (fairly well heeled) colleague and I were discussing a particular investment that contained various unknown risks. As usual, he was fretting about the potential "what-ifs." At one point, I joked with him and said, "So what, you can always just take the million bucks you already have and retire." He shot back, "It takes four million to retire." This colleague had already calculated the pile of capital he would need, at conservative investment returns, to generate the monthly income that he was accustomed to.

You should know that his calculation ignored Social Security (SS) - he didn't think it would be around that long - and his modest pension and also accounted for him leaving his entire retirement principal balance to his two sons after his and his wife's death (I always told him he spoiled his children). So based on these criteria, four million was HIS number. And it was prudent, based on those objectives.

Of course, most Americans don't need anything close to four million bucks to retire comfortably, but his point was well taken and has stuck with me. So how about a rule of thumb or two:

Retirement Rule of Thumb #1 - The Leave an Estate Plan (you might also want to think of this as "the spoiled kids rule" or alternatively "the live off the interest rule"): From a moderately diversified investment portfolio, you would be able to withdraw one half of one percent (0.5 percent) per month and very likely never touch your principal. The math wizards will quickly deduce that this equates to a 6 percent per year rate of return. For our mythical one million bucks, that would equate to $60,000 per year (or $5,000 per month). Can you live on that? Add in SS and perhaps a pension, and for many Americans the answer would be "Yes." It might require relocating to a lower cost locale since NJ is a notoriously high tax, high cost and retirement unfriendly state.

Retirement Rule of Thumb #2 - The Don't Worry About Leaving an Estate Plan (you might want to think of this as the "to hell with the kids rule" or "no luggage rack on a hearse rule"): From a moderately diversified investment portfolio, you would be able to withdraw one full percent (1 percent) per month and likely chew through your principal over time, but not at a rate fast enough to reach zero before you die. You need not be a math wizard to deduce that this equates to a 12 percent per year rate of return. Once again, for our mythical one million dollar nest egg, you would earn $120,000 per year (or $10,000 per month). Can you live on that? Even without adding back SS and perhaps a pension, most Americans could easily say "I can live on that." It might not even require the relocation to a lower cost, more tax friendly state (but, hey why not!).

There is a mountain of empirical evidence to support both rules; based on life expectancies, historical investment returns, the business cycle, etc. The rule is easy to apply, and in most cases you don't need a calculator. For example, you are 50 years old, and just received your quarterly IRA statement. It projects that in 15 years (you projected retirement date) your balance should be about $700K, with past returns projected out. You have no heirs, so you apply Rule #2 and determine that you can withdraw $7,000 per month. When you add in your expected SS income and a small pension, you decide this is fine and little if any change in lifestyle will be required.

On the other hand, if you insist on leaving an estate to your heirs you must apply Rule #1. Worse yet, you have always been self-employed and paid only minimal amounts into SS and have no pension. Could you live on $3,500 per month? Certainly not in NJ, but it seems it would be lean even in North Carolina, Tennessee or Florida. Your only choice is to throw the heirs overboard and/or substantially increase your savings rate between now and your retirement date. You get the point.

One can conjure up any number of scenarios. However, the basic premise is that, generally speaking, you won't chew through principal at a 6 percent investment return and only modestly so at a 12 percent return. You can pick points in between and modify any number of other parameters, but the rules will generally hold true. And better yet, you can ignore inflation and taxes since they shouldn't appreciably change the math. I apply these two rules of thumbs all the time. And you can too. Maybe you could even charge a fee...


"A man is not finished when he is defeated. He is finished when he quits." - Richard Nixon

Today in History

1946 - Tide detergent is introduced.

Flash Fact

A traditional Christmas dinner in early England was the head of a pig prepared with mustard.

Have a comment about something you read in GCFlash? Suggestions for future articles? Drop us an email!

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