Affinity

?Whoworks for youInsurance Agents | Branch Managers | Portfolio Managers | Loan Officers | Financial Analysts | Payroll Managers

Affinity has a full range of services that you expect and need as a small business from insurance, to payroll services,loans, business checking and savings. As your business grows,Affinity can provide services tomeet your expanding needs without having to shop around.And, you can let us manage the details while you manage your business.

Our Partners are here to help.

Affinity partners with some of theleading providers of services such as Paychex and TravelersInsurance to provide your business with the right solutions.Affinity can act as your singlesource to these services savingyou time and money.

Affinity BusinessSolutions works for you

Insurance Agents | Branch Managers | Portfolio Managers | Loan Officers | Financial Analysts | Payroll Managers

We offer you lower fees and better rates.

As a member of a credit union,your membership entitles you toextremely competitive rates andlower fees on the products and services your business needs.And, we have the flexibility tomeet your needs no matter whatthe size of your business. In fact in 2007, Affinity extended loansranging in size from 5 thousanddollars up to loans of 5 milliondollars, for businesses just like yours.

We think small business. We’re so dedicated to small businesses like yours, that wehave created a Business Advisory Council that will look to businesses like yours to provideus with feedback on the wantsand needs of small businesses, to help us build an even betterproduct offering.

Membership makes a difference.

At Affinity Business Solutions youare a member, not a customer.We think you’ll find working withAffinity different than workingwith other banks and financialinstitutions with our commitment to you to provide ...

We’re bigger than a lot of banks. We just don’t act that way.

Affinity Federal Credit Union manages assets of over 1.5 billiondollars. With over 125,000 members of over 1,700 businesses we are the largestcredit union in New Jersey. And,even though we’re big enough toprovide all the solutions youneed, we’re small enough to provide you the kind of hands onservice you expect, includingaccess to the right people in our organization.



Affinity Business Solutions


I work for you

Affinity Value Proposition

We promise that our knowledgeable, engaging and caring professionals will makeour members feel great about the AffinityExperience, while offering the best and easiest to use financial products and services to meet our members’ needs.

Announcing Affinity’sNew EasyFLEX Home Equity

Line of Credit

One account, Four loans, Infinite possibilities

A flexible line of credit that lets you take up to four separate loans when you need them!

There’s never been an easier way to borrow the money you need for:

• Home Improvement• Debt Consolidation• College Expenses• Unforeseen Expenses

Annual Percentage Rate (APR) is XX.XX% as of [date]. Rates are subject to change. The maximum APR that may be charged is 18.00%. Properties not located in New Jerseyare subject to state mortgage tax fees, which typically range between $0 and $5,000. Consult your tax advisor regarding the deductibility of interest under this plan. Withinthe Easy Flex HELOC there is a fixed rate option which you may use for up to 3 advances at any one time. When you choose this option the interest rate you receive for thatadvance will be fixed until the balance is repaid. Your fixed interest rate will be determined by the Credit Union adding or subtracting, in its sole discretion, a margin of twoand one-half per cent (2.5%) to the U.S. Prime Rate Published in the Wall Street Journal at the time you choose this option. We reserve the right to charge a lower margin.The APR includes a 0.25% reduction for automatic payment from your Affinity account. Home Equity Lines of Credit and Fixed Rate Equity Loans are not offered in Texas.South Carolina requires the borrower(s) to have a closing attorney; other states may have the same requirement for legal representation.

A Flexible Line of Credit and Fixed Rate Loan in One Account!

Announcing Affinity’s New

EasyFlex Home Equity Line of Credit

• One application, one approval, no closing costs• Up to four active loans at any one time• No fixed vs. variable rate choices to make. You can have both• Flexible terms and repayment plans• Interest may be tax-deductible

To learn more or apply today, visit any branch, call 800-325-0808 prompt 3, or visit www.affinityfcu.org/easyflex

EasyFlex can be applied to equity in primary homes or vacation homes.HELOC loans and FRED loans are not offered in Texas.South Carolina requires member to have a closing attorney

Borrow What You Want—When You Want.


EasyFlexHome Equity Line of Credit






Announcing Affinity’s New EasyFlex Home Equity Line of Credit


• One application, one approval, no closing costs

• Up to four active loans at any one time

• No fixed vs. variable rate choices to make. You can have both

• Flexible terms and repayment plans

• Interest may be tax-deductible





EasyFLEX Home Improvement

The best features of variable rate home equitylines of credit and fixed rate home equity loansin one convenient account.

CollegeExpenses

DebtConsolidation

UnforeseenExpenses

Home Equity Line of Credit4 loans • 1 account • Infinite possibilities

Announcing Affinity’sNew EasyFLEX

• Home Improvement• College Expenses• Debt Consolidation• Unforeseen Expenses

Home Equity Line of Credit

4 loans1 accountInfinite

possibilities

Announcing Affinity’sNew EasyFLEX

Home Equity Line of Credit

4 loans, 1 account,Infinite possibilities

The best features of variable rate home equity lines of creditand fixed rate home equity loans in one convenient account:

• Home Improvement• Debt Consolidation• College Expenses• Unforeseen Expenses

Home ImprovementCollege

ExpensesDebt Consolidation

UnforeseenExpenses

Announcing Affinity’sNew

EasyFLEXThe best features of variable rate home equity lines of credit and fixed rate home equity loans in one convenient account.

Home EquityLine of Credit

4 loans • 1 account • Infinite possibilities

Do the Math1 account = up to 4 home equity loans

Affinity’s new EasyFlex Home Equity Line of Credit provides15 years worth of

variable and fixed rate loans with one application… and one approval

EasyFlex offers:


It all adds up. To learn more or apply today, visit any branch, call800-325-0808 prompt 3, or visit www.affinityfcu.org/easyflex

There’s never been an easier way to

borrow the money you need for:

• Home improvements

• College expenses

• Debt consolidation

• Unforeseen expenses

Affinity’s new EasyFlexHome Equity Line of Creditprovides15 years worth ofvariable and fixed rate loanswith one application… and one approval

EasyFlex offers:

• One application, one approval, no closing costs

• Up to four active loans at any one time

• No fixed vs. variable rate choices to make. You can have both

• Flexible terms and repayment plans

• Interest may be tax-deductible

It all adds up. To learn more or apply today, visit any branch, call 800-325-0808 prompt 3, or visit www.affinityfcu.org/easyflex

1 account = up to 4 home equity loans

Affinity’s new EasyFlex Home Equity Line of Creditprovides15 years worth of variable and fixed rateloans with one application… and one approval

Do the Math

EasyFlex offers:


It all adds up. To learn more or apply today, visit any branch, call800-325-0808 prompt 3, or visit www.affinityfcu.org/easyflex

There’s never been an easier way to

borrow the money you need for:

• Home improvements

• College expenses

• Debt consolidation

• Unforeseen expenses

Announcing Affinity’sNewEasyFLEX

Home Equity

FLEXIBLE LINE OF CREDIT

ONE ACCOUNT, FOUR LOANS

ONE APPLICATION, ONE APPROVAL, INFINITE POSSIBILITIES

Line ofCredit

W I N T E R 2 0 0 9

FreshPerspectives

New Year’s Resolutionsfor Your Business

1 Affinity Connections | WINTER 2009

Dear Fellow Affinity Member:

The New Year is a time for resolutions and reflections.Resolutions that we will somehow do better in thefuture and reflections of what we could have donebetter in the past.

I want to take this opportunity to express a fewreflections and resolutions of my own. First, I want toreflect on your loyalty and how appreciative I am forletting us be your financial advocate. Second, I wantyou to know that all of us at Affinity resolve to dowhatever we can to deserve your continued supportin 2009.

In this issue of Connections, we provide a number ofideas to help you improve your financial outlook,whether you’re a business owner concerned abouttrimming expenses in 2009 or a consumer wonderinghow you’re going to pay off the debt you accumulatedduring 2008.

An economy like this requires that you pay especiallycareful attention to such basic considerations as whereto invest your cash reserves, whether you shouldborrow and if so, which of the many loans available intoday’s marketplace are most appropriate for you.We’ve included back-to-basics information on savingsand checking accounts, loans and lines of credit thatcan help you make the right decisions. And we’ve alsodrawn some distinctions between life and long-termcare insurance to help you determine whether youneed one or both types of coverage to truly protectyour family.

Thank you for your membership. I wish you the happiestof New Years and hope that 2009 will be a year offulfillment and prosperity for you and your family.

Sincerely,

John T. FentonPresident and CEO

Your Investment Portfolio......................................................... 2– The Basic Tenets of Sound Investing

Cut the String on Yo-Yo Budgeting......................................... 3– Getting Off the Debt Cycle

Learning to Love Red Ink.......................................................... 5– Finding the Right Loan

Taking Care of Business............................................................. 7– Setting SMART Goals

Rainy Day Reserves...................................................................10– Planning for the Unexpected

Covering Your Bases..................................................................11– Long Term Care and Life Insurance

AFFINITY NEWS.....................................................................13

WELCOME NEW SEGs ......................................................14– Thank You for Choosing Affinity

IN EVERY ISSUE

I N T H I S

I S S U E

3

5

10

7


This newsletter is distributed with the understanding that it does not constitute legal, accounting or other professional advice. Neither Affinity nor any other partywill assume liability for loss or damageas a result of this material. Appropriate legal or accounting advice should be sought from a competent professional. Affinity is not responsible for typographic or inadvertent errors. Affinity FinancialServices is a wholly owned subsidiary of Affinity Federal Credit Union. © 2008 Affinity Federal Credit Union.

What now for your investment portfolio?

The Callan Periodic Table of Investment ReturnsAnnual Returns for Key Indices (1995-2007) Ranked in Order of Performance

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007S&P/Citi

500Growth38.13%

S&P/Citi500

Growth23.97%

S&P/Citi500

Growth36.52%

S&P/Citi500

Growth42.16%

Russell2000

Growth43.09%

Russell2000Value22.83%


LB Agg

10.26%

Russell2000

Growth48.54%


MSCIEAFE

13.54%

MSCIEAFE

26.34%

MSCIEAFE

11.17%S&P 500

38.13%

S&P 500

22.96%

S&P 500

33.36%

S&P 500

28.58%

S&P/Citi500

Growth28.25%

LB Agg

11.63%

LB Agg

8.43%

Russell2000Value

-11.43%

Russell2000

47.25%

MSCIEAFE

20.25%

S&P/Citi500

Value5.82%


S&P/Citi500

Growth9.13%

S&P/Citi500

Value36.99%

S&P/Citi500

Value22.00%


MSCIEAFE

20.00%

MSCIEAFE

26.96%

S&P/Citi500

Value6.08%

Russell2000

2.49%

MSCIEAFE

-15.94%


Russell2000

18.33%

S&P 500

4.91%

S&P/Citi500

Value20.81%

Russell2000

Growth7.05%

Russell2000

Growth31.04%


S&P/Citi500

Value29.98%

S&P/Citi500

Value14.69%

Russell2000

21.26%

Russell2000

-3.02%

Russell2000

Growth-9.23%

Russell2000

-20.48%

MSCIEAFE

38.59%

S&P/Citi500

Value15.71%


Russell2000

18.37%

LB Agg

6.97%Russell2000

28.44%

Russell2000

16.53%

Russell2000

22.36%

LB Agg

8.70%

S&P 500

21.04%

S&P 500

-9.11%

S&P/Citi500

Value-11.71%

S&P/Citi500

Value-20.85%

S&P/Citi500

Value31.79%

Russell2000

Growth14.31%

Russell2000

4.55%

S&P 500

15.79%

S&P 500

5.49%Russell2000Value25.75%

Russell2000

Growth11.32%

Russell2000

Growth12.93%

Russell2000

Growth1.23%

S&P/Citi500

Value12.73%

MSCIEAFE

-14.17%

S&P 500

-11.89%

S&P 500

-22.10%

S&P 500

28.68%

S&P 500

10.88%

Russell2000

Growth4.15%

Russell2000

Growth13.35%

S&P/Citi500

Value1.99%

LB Agg

18.46%

MSCIEAFE

6.05%

LB Agg

9.64%

Russell2000

-2.55%

LB Agg

-0.82%

S&P/Citi500

Growth-22.08%

S&P/Citi500

Growth-12.73%

S&P/Citi500

Growth-23.59%

S&P/Citi500

Growth25.66%

S&P/Citi500

Growth6.13%

S&P/Citi500

Growth4.00%

S&P/Citi500

Growth11.01%

Russell2000

-1.57%MSCIEAFE

11.21%

LB Agg

3.64%

MSCIEAFE

1.78%

Russell2000Value-6.45%


Russell2000

Growth-22.43%

MSCIEAFE

-21.44%

Russell2000

Growth-30.26%

LB Agg

4.10%

LB Agg

4.34%

LB Agg

2.43%

LB Agg

4.33%


Source: © 2008 Callan Associates, Inc.

Market conditions of the past several monthshave compelled many investors to liquidatetheir holdings and run for the safety of FDICand NCUSIF-insured accounts – oftenafter suffering substantial losses.

Interestingly, however, several studiescompleted before last fall concluded thatinvestors who try to time the markets bybuying and selling mutual funds at whatthey perceive to be opportune times,underperform investors who simplyemploy a buy-and-hold strategy. In fact,many investors actually underperform theinvestments in their portfolio because theysell their holdings when prices are lowand miss the opportunity to recoup theirlosses when markets turn around.

It’s not easy to look at your accountstatements each month and see losses thatmay be more dramatic than any you'veever experienced before. But unless youtruly believe that markets will neverrebound, you might do well to rememberthese basic tenets of sound investing:

1.Asset Allocation

According to numerous financial studies,asset allocation accounts for 93.6% of aportfolio’s return, while securities selectionaccounts for only 4%. The right allocationfor one person, however, may be totallywrong for another. Your allocation shouldbe a reflection of your objectives, risktolerance and other factors. To develop it,you should consult with your financialadvisor or use the analytical tools availableat such websites as www.mint.com orwww.kiplinger.com.

2.Diversification

Diversification within asset classes iscritical. The chart on the right may looklike the periodic table you were forced to

study in high school chemistry class, but acloser look reveals that it lists the topperformers by investment category over theperiod from 1995-2007. As you can see,from 1995-1998, large cap growth stocksgenerated the highest returns. Over thepast three years, international stocks werethe winner.

The point is that different investmentcategories fall in and out of favor indifferent market environments. That’swhy diversification among several isso important.

3.Rebalancing

Your asset allocation should remainconstant since it is a reflection of your risktolerance, objectives and time horizon.Rising or falling securities prices, however,can change your allocation without yourrealizing it. As a result, astute investorsrebalance their portfolios periodically to

ensure they are not assuming more or lessrisk than they originally intended.

YOU’VE GOT TO BE IN IT TO WIN IT

Recently, The New York Times cited a studythat looked at equity markets in 15nations, including the U.S.1 A portfoliobelonging to an investor who missed the10 best days over several decades across allof those markets ended up, on average,with about half the balance of someonewho sat tight throughout.

In short, it may be tempting to liquidateyour stock positions now and take aknown loss instead of incurring potentiallybigger losses down the road. But what ifthe market turns around, if not now, thenseveral months from now? How will youknow when to get back in? Unless youtime your move impeccably, you may neverrecoup your losses.

Source:1 New York Times, October 8, 2008.

Securities offered by Affinity Investment Services, LLC, 73 Mountain View Boulevard, Basking Ridge, NJ 07920, member FINRA/SIPC. Investments offered byAffinity Investment Services are not deposits or obligations of Affinity Federal Credit Union. They are NOT NCUA INSURED and NOT GUARANTEED by AffinityFederal Credit Union or any governmental agency and are subject to INVESTMENT RISK, including LOSS of PRINCIPAL. Investments may lose value. AffinityInvestment Services, LLC is a wholly owned subsidiary of Affinity Federal Credit Union.


This year, the situation may be evenmore dire. The combination of risingdebt, rising prices, dimming jobopportunities and declining homevalues has already resulted in thehighest personal bankruptcy rates sincethe early 1990s.3 And if consumers don’tmake a greater effort to incur less debtand pay off the debt they’ve alreadyincurred, that rate could rise even higher.

How can you get off the cycle of yo-yobudgeting—paying off debt only toincur it again—or avoid getting in thecycle in the first place?

In our last issue of Connections,we discussed debt counseling andmanagement programs, but typicallyas a last resort. Here are a few simplemeasures you can take before you getto that point:

The new year typically begins with too many Americans wondering how

they’re going to pay off all the holiday debt they’ve accumulated. To be

specific, Americans currently carry approximately $2.6 million in consumer

debt—up 24% from 2003 levels.1 And the average amount of credit card

debt per U.S. household is a whopping $9,840—up 25% since 2000.2

Resolve to cut the string onyo-yo

budgeting this year

1.Determine how much you owe

Sounds fairly obvious, doesn’t it?Except so many Americans owe somuch on so many different creditcards, not to mention other loansthey may be carrying, that they don’treally know. Start by making a listof all your credit cards, your currentbalance on each and the interest ratethat each charges. Some people begintheir efforts by focusing on the cardsthat charge the highest rates. Othersfocus on the cards with the lowestbalances so they can feel a senseof accomplishment as quickly aspossible. Either way, develop a planto pay off these debts by includingpayments as part of your monthlybudget . . . which brings us to ournext suggestion.

2.Develop a budget

Most people don’t have one. They mayknow what they pay for such importantfixed expenses as a mortgage payment,rent or car payment, but beyond that,they’d be hard pressed to provide anaccurate figure. Compile all monthlystatements and categorize expenses bysuch headings as food, utilities, clothes,gas, etc. Now divide categories intosub-categories—what you truly needand what you don’t.

How do the results match up with yourincome? Do they match up better onceyou eliminate impulse buys andunnecessary expenses? Because “mandoesn’t live by bread alone,” you mightwant to include a figure for “wants,” asopposed to “needs” in your budget, butmake sure this figure doesn’t equal theamount of any surplus you may have.

You still have to budget for the debt youalready owe and hopefully, for savingsas well.

3.Stop using your credit cards

Yes, we know this seems like a drasticmeasure, but until you get out fromunder what you’ve already incurred,you might find that paying with cashwill curb your expenses.

4.Consider debt consolidation

Many banks and credit unions offer youthe ability to consolidate all your creditcard balances into one convenient loanaccount. Typically, this loan imposes alower interest rate than the credit cardcompanies you’re currently paying.

Some consumers choose home equityloans for debt consolidation becausethey offer a lower rate than debtconsolidation loans. Remember,however, that failure to pay off a homeequity loan can place your home injeopardy. And while a debt consolidationloan charges a higher interest rate, itmay be a safer solution. Just makecertain you read the fine print. Somedebt consolidation loans only offer lowrates for a specified period of time. Andif your credit score is low, you may berequired to pay a higher rate than thatwhich is advertised.

5.Set specific goals

Instead of just vowing to pay off alldebt and save more for the future, youshould consider formulating objectivesthat have numbers attached to them—I’m going to pay off 50% of my Visa®

balance by April; I’m going to pay downmy car loan by $7,000 this year, etc.

Once you actually pay off debt, don’tstop making periodic payments. Justchange the recipient of those paymentsfrom a lender or credit card companyto yourself. Build up your savings orretirement account. Or determine a newobjective like saving for a vacation,down payment on a new car or evena specific amount you can use nextholiday season.

MORE TIPS TO CUT THEYO-YO STRING

• If you’re even moderately computer-savvy, consider buying a softwareprogram like Quicken® or Microsoft®

Money that enables you to track yourmonthly expenses and understandwhere your money is actually going.

• If you’re a two-income family, make aneffort to live on one of those incomesand invest the rest. Again, set specificgoals for the assets you're investing.

• Build charitable contributions intoyour budget. By giving money to anorganization that’s important to you,you achieve a number of objectives—namely, supporting a cause you feelpassionate about, receiving a taxdeduction for the contributions youmake and maybe decreasing theacquisitive impulse in yourself thatcaused you to get into debt in thefirst place.

Managing your debt can mark thebeginning of a new financial awarenessthat will guide your actions and keep youon a straighter path toward your mostimportant objectives.

Sources:1 Choking on Credit Card Debt, Forbes.com, September 20082 Ibid3 Bankruptcies Back on the Wrong Track, Center forAmerican Progress, June 2008, www.americanprogress.com


Resolve to ManageYour Debt More

Effectively This Year

Affinity’s free Budget and Credit Score Enhancement Service (BASES)can help you get out of the debt cycle. To learn more, visitwww.affinityfcu.org or call 800-325-0808 ext. 3753.


Some people view debt as a last

resort, while others embrace it as

an integral component of their

financial plan.

The fact is, the right financingarrangement can help you buy a home,send your children to college or acquireany number of goods and services withoutliquidating valuable assets. As a result,you avoid incurring income tax liabilityfor any gains you might have earned andmaintain the growth potential of yourinvestment portfolio or real estateholdings. With all the innovative loansthat have been introduced in recent years,however, many consumers are unsurewhich might be most suitable for them.

Here are a few basics to consider nexttime you go loan shopping:

• Secured or unsecured

Secured loans are based on collaterallike your home or securities portfolio.Unsecured loans are based solely onyour credit—whether or not, in theopinion of the lender, you have theability to repay the loan on a timelybasis. Secured loans, as you mightexpect, offer lower interest rates thanunsecured loans. However, they involvegreater risk—if you can't makepayments, you may lose the assetssecuring the loan.

• Fixed or variable

Some loans offer a fixed interest ratethat never changes. Others offer a rate

that changes periodically to keep pacewith prevailing interest rate levels.Variable rate loans generally offer lowerrates than their fixed ratecounterparts—at least initially.Depending on interest rate fluctuations,however, variable rate loans mayultimately cost you more.

• Loan or line of credit

A loan is simply an agreement toborrow money and pay it back withinterest over a specific time period. Aline of credit is available over a specifictime period to provide you with fundswhen you need them. You may accessyour line of credit by simply writing acheck. Each check you write is inessence a loan that must be paid backwithin a specific timeframe.

How the Right Loan Might BeYour Staunchest Financial Ally

Learning to love red ink:


If You’reContemplating

a Loan…

…understand the options available to you. Talk to an Affinity LoanSpecialist who can help you develop a financing strategy that makessense for you. Visit www.affinityfcu.org or call 800-325-0808.

WHAT ARE YOUR ALTERNATIVES?

Credit Cards

Credit cards are essentially loanagreements. The loan begins when youuse your card to make a purchase.Repayment begins when you receive yournext monthly statement. With creditcards, you can take as long as you wish topay, provided you make a specifiedminimum payment each month. However,the interest rates charged by credit cardproviders are notoriously high—approximately 12-13% on average.1 As aresult, you should confine use of yourcredit cards to short-term purchases andseek other financing arrangements forlonger-term needs.

Personal Loans

These can be car loans, debt consolidationloans, home improvement loans or otherloans that are typically unsecured(although in the case of some car loans,they may be secured by the vehicle youpurchase). The term for these loans istypically less than five years and while theinterest rate charged is lower than thatimposed by credit cards, it’sconsiderably higher thansecured alternativeslike home equityloans and linesof credit.

Home Equity Loansand Lines of Credit

What if you could access the equity you’vebuilt up in your home to pay for virtuallyany expenses—remodeling, college tuition,medical expenses, or a new car? That’s theprinciple behind home equity loans andlines of credit, financing arrangements thathave become increasingly popular over thepast 20 years.

In addition to providing a ready source ofcapital, home equity loans and lines ofcredit are usually available with no closingcosts or application fees. In addition, theapproval process is far less onerous andtime consuming than that required fortraditional mortgages.

Home equity loans offer a fixed rate withterms that can range from 5-20 years.Home equity lines of credit typically offera fixed rate for a specified number ofyears before changing to a variable ratefor the remainder of the term. Unlikepersonal loans and lines of credit, theinterest paid on home equity loans andlines of credit may be tax-deductible.

Stock-Secured Loans andStock-Secured Lines of Credit

These overlooked vehicles work similarlyto home equity loans and lines of creditexcept instead of using the equity in yourhome as collateral, they use the value ofsecurities in your investment portfolio.

Generally, borrowers can access up to 50%of the market value of stocks, bonds,mutual funds and other eligible securities.

Loans are often available with terms ofup to five years and charge a fixedinterest rate. Lines of credit offer theconvenience of being able to accessfunds by writing a check, andcharge a variable rate.

Business owners often find stock-securedloans to be a valuable tool for managingunpredictable cash flow, and takingadvantage of immediate opportunitiesuntil longer-term financing can bearranged. You should realize, however,that if the value of your securities declinesin unfavorable markets, you may berequired to deposit additional collateral.

WHICH LOAN SHOULD YOUCHOOSE?

There are no right or wrong answers.What may seem to be the right loanchoice at one time in your life may bethe wrong choice at another.

For example, if you’re looking to financea new car, you may automatically applyfor a car loan. But chances are, you couldget a much lower interest rate byarranging for a home equity loan or lineof credit. At the same time, you have todecide how long you want to pay for yourpurchase. Car loans are available withterms as low as two or three years. Homeequity loans usually require a minimumterm of five years. Your monthly paymentswill be lower with a home equity loan,but you could be paying more in interestcharges over the duration of the loan.

You should also determine whether afixed-rate or variable-rate loan wouldmake more sense for you. Variable-rateloans may offer lower rates initially, butultimately they impose a rate thatfluctuates with prevailing interest rates.What if rates go up over time?

Fixed-rate loans allow you to lock in arate over the long-term, but what ifinterest rates go down and you’re stuckpaying a higher rate than you would havepaid with a variable-rate line of credit?

Of course, no one can predict thedirection of interest rates, but you shouldconsider the economic climate, as well astimeframe, interest payments and yourown needs and objectives before you signon the dotted line.

Source:1 www.indexcreditcards.com, September 2008


Taking Care of Business

According to some experts, 5% ofbusinesses actually thrive duringrecessionary environments.1 And, thevast majority of them do survive. Whatcan you do to take advantage of anyopportunities that might be hiding inthe gloom and position yourself forwhat will hopefully be a not-too-distant turnaround?

IF YOU’RE GOING TO SET GOALS,MAKE SURE THEY’RE SMART

SMART stands for specific, measurable,attainable, realistic and timely. It's a termused by business consultants to helpclients separate actionable ideas fromwishful thinking. “I’m going to get inshape this year,” might be an example ofthe latter. “I’m going to fit into those jeansI bought last year by September,” mightbe an example of something SMART-er,

New Year. New President. But unfortunately, not a new

economy—at least not yet. The difficult conditions that have

plagued American consumers and businesses since early 2008

have not yet changed for the better. But that doesn’t mean you

have no choice but to grit your teeth and wait passively for

better times.


especially if it's accompanied by, “I’mgoing to cut out desserts and join a gym.”

Here are a few potentially SMART ideas towhich you can add appropriate detail:

• By all means, reduce expenses. But, becareful not to slash muscle while you’retrimming fat. Don’t automatically lookto lay off valuable employees or cut yourmarketing budget. In fact, now may bethe time to add a dynamic salespersonor increase your advertising presence.After all, the idea of owning your ownbusiness is to generate business, isn’t it?

Before you start cutting, try to quantifyhow much you hope to save andcarefully analyze every area of youroperations to determine which are trulynot contributing to your bottom line.

• Don’t just monitor cash flow, forecast it.That means matching your fixedexpenses and planned expenditures toaccounts receivable and making

adjustments if they don't balance.What kind of adjustments? Avoidexpenditures that aren’t completelynecessary, of course, but pay closerattention to collections as well. Today’slackluster economy is probably affectingyour clients as negatively as it’s impactingyou. Stay in close touch with them todetermine how they’re faring andwhether their creditworthiness hastaken a hit. Don’t wait until paymentsare overdue before you begin collectionefforts. And make sure you address allcustomer service issues promptly, sothey can’t be used as an excuse forwithholding remittance.

• Add value, don’t cut prices. Byconducting a fire sale, you commoditizethe products and services you offer. Andonce you cut prices, you may not be

able to increase them again so easilywhen the economy turns around. Nowis the time to focus on improvingservice by shortening productionschedules or keeping more customer-friendly hours. And if you must focuson price, confine your efforts torewarding important customers withpre-payment incentives or price breaksfor entering long-term contracts.

• Take stock of your inventory. It’spointless to tie up cash in unproductiveassets. By now, you should know howmany times a year you typically turnyour inventory or how long it takesyou to sell it. If sales are slowing, orderfewer products and continue to monitoryour progress so you don’t overstock orget caught short in the event of aneconomic turnaround.

• Be SMART about debt. Depending onprevailing interest rates, you may beable to refinance loans or negotiate lines

of credit at more favorable terms. Ifyou’re crunched for cash, considertalking to creditors about extendingpayments before your bills are past due.Chances are they’ll be receptive if youhave a solid credit history.

• Involve your employees. They’reaffected by adverse business conditions,too. Meet with them regularly and enlisttheir assistance in cutting costs andimproving productivity. If layoffs seemunavoidable, ask them to developalternative solutions—job sharing orshortened hours, perhaps. And, especiallyin difficult times, show employees howmuch you appreciate them. You may notbe able to give them raises, but a simplecompliment or public acknowledgementof their contributions can go a long waytoward lifting morale and ensuringcommitment.

In this or any economy, it’s important tomeasure your progress. You don’t knowwhere you are if you don’t know whereyou’ve been. Establish metrics for all yourbusiness processes—how long it takes todeposit customer payments and gainaccess to cash, how individual items inyour inventory are selling and whetheryou’re tying up capital in slow movinggoods. If you’re a service business,

determine how to maintain the qualityof your service. Do you obtain feedbackfrom customers, for example, or imposeservice standards on employees?

The 5% of businesses that thrive indifficult economic environments don’tall do it by luck. Resolve to make 2009your SMART-est year yet. You may findyourself flourishing even before theeconomy turns around.

KEEPING MORE OF YOUR PROFITSTHROUGH ASTUTE TAX PLANING

Making money in this economy is difficultenough without contributing an undulylarge portion of it to unnecessary taxes.

As a business owner, you have numerousopportunities to reduce your tax billthrough such allowable write-offs as up to

in Today’s Sluggish Economy


How Do You MakeSMART–er BusinessDecisions This Year?

Affinity Business Solutions offers customized advice that can lead toa healthier bottom line and greater employee satisfaction. For moreinformation, visit www.affinityfcu.org or call 800-325-0808.

$250,000 for major equipment purchaseslike computers or office furniture and100% of any health insurance premiumsyou pay.

Beyond these incentives, however,Uncle Sam offers a number of otheropportunities to reduce your business’income tax, provided you know whereto look for them. Here are just a few tothink about:

• Defer income…or not

If you think that this year will be betterthan next, defer year-end billing to justbefore the new year or even 2010, sothat the payments you receive won’tcount toward this year’s income tax.Conversely, if you think that next yearwill be more profitable than 2009, speedup your billing process and try to bookas much income as possible this year.

Variations on this theme includeprepaying estimated tax payments andperhaps even electing a new fiscal year.

• Estimated tax payments are deductiblefor the year that they’re paid. If youforesee a large tax bill, make yourJanuary 2010 estimated payment inDecember 2009. That will reduceyour taxable income for this year,instead of next. The same principleapplies to local property taxes. Makingany payments in December will enableyou to take a deduction for this year.

• You don’t have to adopt the calendaryear as your fiscal year. If yourbusiness tends to be cyclical, withsales at their strongest around theholiday season, consider ending yourfiscal year in June. This strategy willenable you to defer tax payments onyear-end profits to the following year.

• Bite the bullet on bad debts andsluggish inventory

Uncollectible debts are especiallyfrustrating to business owners becauseeven if they file a small claim against thedebtor and receive a favorable judgment,they often fail to collect because thedebtor goes bankrupt. As long as youkeep records showing that you tried tocollect payment, you can write-off debtsfor which you have no hope of evergetting paid. In addition, you mightthink about going through yourinventory and destroying or donating

those dusty goods that were supposedto be hot sellers but never were.

• Make the most of losses

Individual tax payers who sufferinvestment losses often carry forward aportion of their losses for use in futureyears. The same principle applies inreverse for businesses. If you foreseemajor losses, you might be able to carrya portion of them back to the twoprevious tax years. That means youwould actually qualify for a refund oftaxes you have paid in those years.

Source:1 Reilly, Tom, Selling in Tough Times,www.tomreillytraining.com, 2008

Don’t Try This at Home

Tax laws are complex and one wrong move can have a ripple effect on your businessand personal finances. If you don’t currently work with a CPA, do so immediately. Theright professional can not only prepare your taxes and help you identify write-offs youmight miss on your own, but can provide you with ongoing advice that can result intax savings far exceeding the fees you pay.

To choose the right CPA for your business, ask colleagues and associates for referrals,but you might also consider the following:

• Who does your bookkeeping?

Some business owners want the control of keeping their own books throughQuickBooks® or other recordkeeping systems. Others would just as soon relinquishthis responsibility to an employee or outside professional. Some CPAs offerbookkeeping services, but others do not.

• Do you need a specialist?

Some industries are subject to unique tax laws and government regulations thatrequire specialized expertise. If you’re a dry cleaner, you don’t need an accountantwith expertise of this nature. If you’re in an energy-related business, however, youmight benefit from a CPA who speaks your language.

• Big firm or small?

Big firms typically charge more but offer more services. Small firms provide morepersonalized attention and the benefits of working with the same professional onan ongoing basis. By hiring a sole proprietor or small partnership, you can develop arelationship with a CPA who understands your business.

Once you choose a CPA, meet with him or her on a regular basis, not just at tax time.The right CPA can help you take advantage of favorable tax laws and avoid potentiallyharmful liabilities throughout the year.


Securities offered by Affinity Investment Services, LLC, 73 Mountain View Boulevard, Basking Ridge, NJ 07920, member FINRA/SIPC. Investments offered by AffinityInvestment Services are not deposits or obligations of Affinity Federal Credit Union. They are NOT NCUA INSURED and NOT GUARANTEED by Affinity Federal CreditUnion or any governmental agency and are subject to INVESTMENT RISK, including LOSS of PRINCIPAL. Investments may lose value. Affinity Investment Services, LLCis a wholly owned subsidiary of Affinity Federal Credit Union.

Which Federally-Insured Accountis Right for You?

Checking? Money Manager? Certificate Accounts? Affinity’s checkingand savings accounts are insured to at least $250,000 by the NationalCredit Union Administration (NCUA), a federal agency backed by thefull faith and credit of the United States government. To learn more,visit www.affinityfcu.org or call 800-325-0808.

According to most experts, the answer tothe first question is 3-6 months of livingexpenses. By maintaining this reserve inaccounts that are easily accessed, youprotect yourself in the event ofemergencies such as unforeseen expensesor losing your job. And you avoid havingto sell less liquid investments like stocks,bonds or mutual funds under duress.

As for the second question—how muchshould you keep in each—here’s a look atthe alternatives available to you:

• Checking Account

Does it pay interest? Does it require youto keep a minimum balance and chargeyou a fee if you fail to do so? Does itoffer free checks and online banking?These are just a few of the questions toask about the account that you probablytake for granted. Your checking accountmay not pay much interest, but itshouldn’t be costing you money.

• Money Market Account

You’ll earn high interest in a moneymarket account, but you’ll be subject tomore restrictions. Typically, theseaccounts only allow you to write acertain number of checks and make acertain number of withdrawals andtransfers each month. In addition,money market accounts usually imposea minimum balance requirement.

• Certificates of Deposit

These offer a higher interest rate thanmoney market accounts. What’s more,the rate remains constant until the CDmatures. However, CDs don’t offer thesame liquidity as money market andchecking accounts. You won’t be able towithdraw your assets before maturitywithout incurring a penalty. CDs areavailable in maturities that range from afew months to several years. The longerthe maturity, the higher the interest rate.

CHECKING ACCOUNTS VS. MONEYMARKET ACCOUNTS

• You might consider using a moneymarket account instead of a checkingaccount if you don’t expect to write morethan a few checks or make more than afew withdrawals or transfers each month.

• You might consider a money marketaccount, in addition to your traditionalchecking account, for the 3-6 monthrainy day reserve discussed earlier. Youcan keep only enough in your checkingaccount to meet day-to-day expenses.

• You might also think of your moneymarket account as a convenient placeto keep assets that you plan to spendover the next few months. Moneymarket accounts are a great place tosave funds for quarterly estimated taxpayments or major purchases such ashome furnishings or a new car.

MONEY MARKET ACCOUNTS VS.CERTIFICATES OF DEPOSIT

• You can earn higher interest on yourreserves by allocating a portion of themto Certificates of Deposit with relativelyshort-term maturities (3-12 months),while keeping the remainder in amoney market account.

• Another way to participate in CDswithout tying up all your reserves for along period of time is to laddermaturities. To understand this concept,imagine that each CD is a rung on aladder with the shortest maturity atthe bottom, the next shortest directlyabove it and so on until you arrive atthe longest maturity on the topmostrung. For example, let’s say your laddercontains five rungs with CDs maturingin 3 months, 6 months, 1 year, 18months and 2 years. When the 3 monthCD matures, you can use the proceedsto buy a 2 year maturity since that rungis now vacant. When the 6 month CDmatures, you can do the same, therebyperpetuating the ladder. In this way,you will always have CDs maturing atregular intervals. This approach can alsohelp you take advantage of risinginterest rates by reinvesting proceedsin higher rate CDs. And if rates drop,you will still have a portion of yourreserves in CDs with higher yields.

Reviewing YourRainy Day ReservesHow much should you keep in your checking account, money market account andcertificates of deposit? And how much should you keep in one versus the others?

Most people understand thebasics of life insurance. Itprovides them with the

peace of mind that in the event of abreadwinner’s premature death, his orher family will be able to maintain theircurrent lifestyle without compromise.

But what if that breadwinner doesn’t dieprematurely? What if he or she lives to aripe old age—a distinct possibility, giventoday’s longer life expectancies.

The aging process, unfortunately, is oftenaccompanied by chronic conditions thatmay require ongoing medical attention oreven long-term care at home or throughan assisted living or other facility. In fact,some experts estimate that 70% ofpeople who are age 65 and older willneed nursing home care during theirlifetimes.1

And with the cost of nursing home careaveraging more than $76,000 a year,2

extended treatment can erode even themost carefully constructed retirementnestegg and leave loved ones with littlemore than their memories.

That’s why long-term care insurance hasbecome so popular with aging babyboomers in recent years. Like lifeinsurance, long-term care insurance maypay a benefit in return for periodicpremium payments. Unlike lifeinsurance, however, that benefit is paidnot upon the death of the policy owner,but upon his or her need for custodialcare—what Medicare defines asassistance with such basic life functionsas eating, dressing and bathing.


Covering All Your Baseswith Long-term

Care andLife Insurance


How MuchInsurance Should

You Own?

And what kind? Is your current coverage adequate? AffinityInsurance Specialists can help you find out. Visit www.affinityfcu.orgor call 800-325-0808.

WHAT DOES LONG-TERM CAREINSURANCE COVER?

Depending on the type of policy youchoose, you receive a benefit for aspecified number of years once yourequire custodial care. You may use thisbenefit to meet nursing home, assistedliving, adult day care or home nursingcare expenses. However, benefits are notgenerally paid until the end of whatis called an elimination period that mayvary from a few months to a year.

Some long-term care policies offer benefitsthat are tied to the inflation rate andincrease accordingly year after year. Allpolicies charge premiums that, like lifeinsurance, vary according to your age andmedical condition at time of purchase.Premiums may also vary, depending on the:

• length of benefit period

• amount of benefit

• length of elimination period

You should realize that Medicare andother traditional medical insuranceprograms do not cover long-term careexpenses. Medicare may cover medicallynecessary care after a hospital stay of atleast three days, but coverage for anextended period is limited.

SHOULD YOU PURCHASE BOTHLIFE AND LONG-TERM CAREINSURANCE?

The answer depends on your individualsituation. Many people buy life insurancewhen their children are young and theyhaven't yet compiled enough assets toleave their loved ones financially secure.Often, they let their policies lapse whenthey've reached a point in life wheremajor debts—mortgage, children's collegetuition, etc.—are paid off and their assetsare substantial enough to leave ameaningful legacy.

Other people retain their insurancepolicies as part of an overall estate plan,so that heirs can use income tax-freedeath benefits to pay any estate tax duewithout liquidating real estate or otherassets. And still others would never dreamof giving up their policies because theyown what is called permanent insurance—whole life, universal life or variable lifepolicies that have accumulated cash valueover the years. They may now access thiscash value to pay future premiumsor supplement retirement expenses.

Long-term care insurance, however, is notnearly as complex. If you can afford it,you should seriously consider purchasingit. Failure to do so can:

• limit your options when it comes tochoosing long-term care alternatives

• force loved ones to make difficultchoices under financial duress—should they deplete your assets to payfor care or maybe quit their job to takecare of you themselves

• leave you with no choice but toliquidate assets you had plannedto leave as a legacy

If you ultimately decide not to purchaselong-term care insurance, you shouldkeep your life insurance, so that yourloved ones will be able to inherit thelegacy you intended. You should alsomake certain you have enough assets topay not only for care, but for the livingexpenses of your spouse or other familymembers who depend on you. Finally,when shopping for long-term carecoverage, remember that both you andyour spouse will require separate policies.

Sources:1 The American Society of Aging, “Americans Fail to Act onLong-Term Care Protection”, May 2003

2 Genworth Financial, 2008 Annual Cost of Care Survey


A F F I N I T Y N EW S

Affinity Partners with Community Hope toAid Veterans.

Affinity is proud to support the mission and work of Hope forVeterans®—a transitional housing and rehabilitation program,developed and operated by the nonprofit organizationCommunity Hope (www.communityhope-nj.org). Hope forVeterans helps those who honorably served our countryestablish sustained independence through supported housing,recovery services and financial self-sufficiency throughemployment.

In November 2006, the Affinity Federal Credit UnionFoundation and the Affinity Learning Institute joined withCommunity Hope to launch the “Veterans Learning Institute”to help our veterans get back on their feet financially. Affinityemployee volunteers serve as financial educators and jobsearch tutors through monthly classes.

On Veterans Day 2008, Affinity hosted a luncheon to awardcertificates of completion to the group of veterans whoparticipated in the educational classes over the past year. Theoccasion also served as a fitting way to honor and recognizetheir service to our country.

“Affinity has been one of the earliest supporters of the Hopefor Veterans Program since opening our doors in the summerof 2004,” said Carmela Lunt, President and Founder ofCommunity Hope. “They have been a partner in the truestsense of the word. This partnership empowers our veterans tocompete in the workforce and to budget their monies fornecessities such as housing and transportation so they can beself-sufficient upon graduating from the program.”

The Affinity Federal Credit Union Foundation 501(c)(3)supports local, community-based, non-profit outreachorganizations through close volunteer relationships andmonetary contributions. Find out more atwww.affinityfcu.org/foundation.

Community News

Is Your Contact Information Up To Datewith Affinity?

Unfortunately, identity theft, phishing, and other forms offraud are all on the rise. We want to help you protect youridentity. One way to help protect yourself is to ensure thatyour contact information is up to date with us. For example,has your address, email or cell phone number changed? Let usknow – so we can be sure we have the right information toreach you.

It only takes a minute to update your information:

• Call our Member Service Center at 800-325-0808

• Log on to Internet Home Banking and complete the AddressChange form under Applications and Forms

• Visit one of our branches – find the closest atwww.affinityfcu.org/locator

Let Affinity Help You Prepare Your Taxes!

We offer a variety of tax resources to meet your needs,including:

• Professional tax preparation from experienced CPAs

• Access to TurboTax® OnlineSM, for the do-it-yourselfer,at special discounted prices for our members

• Our Online Tax Center at www.affinityfcu.org/tax for tips,forms, information and more

To learn more, or to schedule an appointment with a CPA,call 800-325-0808 or visit www.affinityfcu.org/tax.

Affinity’s New Website is Coming Soon!

The www.affinityfcu.org site will soon have a completely newlook! Our new website will be intuitive and easy to use –allowing you to find what you’re looking for when you’relooking for it! Even our Internet Home Banking area will geta makeover! We’re sure you’ll agree our new website willbe easy to use. Stay tuned and look for the newwww.affinityfcu.org coming soon!

WELCOME

A Partnership for A Better TomorrowAce Kitchens & Baths Inc.ACNAdaptive Pharmacogenomics, LLCAFM ConsultantsAFScott, LLCAiello SanitationAldozz Foods, Inc.Alfred Aloisi AssociatesAlfred Dunner RetailAll Pro Tents Inc.Amy Church Marinovic, Esq.Archer Cooperative Nursery SchoolAthreyaAVA Properties andManagement, LLCAvelient, Inc.Bayshore Computers &

TelecommunicationsBerkeley PeriodonticsBill Roberts RemodelingBill Wright's Guitar Studio, Inc.BKM Consulting, LLCBoatsafeus, LLCBridgett Thompson Photography, LLCCamera OneCareer ResolutionsCassandra's Florals and GiftsCavvy Services, Inc.Chronic Pain Solutions, LLCCoach A La RoachColumbus General StoreCombo Vending, LLCCorporate Security Force, LLCCorporate Security Solution, LLCDelta Marcliff Insurance AgencyDenise Marie Interiors, LLCEast Dragon Karate AcademyeBSTC Business System Technologies

CorporationEclectic Affairs, LLCEMESS ManagementExecutive Financial Management, Inc.Expressions by JosephineFox Media GroupGateway AcademyGEM Obsessions, LLC

Genevieve Jones PhotographyGlobal Microsystems Inc.Goboss Productions, LLCGolden Years Unlimited, Inc.Hahr & Lyon ConstructionHeart & Vascular Center of New

Brunswick, LLCHeritage Music CorporationHovaco, LLCICM Consulting, LLCImports Décor Inc.inforeemIntersoft Technologies International, LLCJames Famula, PGA ProfessionalJC Rehab, LLCJentrak Herbal ProductsJerry's PlaceJust Etc.Klean Bubbles LaundromatKlemEnt, LLCL. Goodman ConsultantsLane One, Inc.Laser RenewLeckner Marketing Consultants, Inc.Libertek, Inc.Living Life Therapeutic Massage &

BodyworkLNC Technology, LLCMauro, Savo, Camerino & Grant, P.A.Meals on WheelsMiddletown Township of NJ Lions ClubMidnight Express Courier, Inc.Mike's Automotive Service Center, Inc.Mirror Image Barber ShopMoczo's CateringMorrow & Associates, LLCMSONew Jersey Right to LifeNew Jersey Youth Golf FoundationNew Mid Town Food MarketNJ Center For The Healing ArtsNJ Wait StaffNJANALYTICS, Inc.Noihsaf Basement, LLCNovehc Enterprises, Inc.Nucomm, Inc.

Open Gates to Fly Enrichment Schoolof Tutoring

P.D. Fiorentino, Inc.Plainfield Boxing Academy, Inc.Primerica A Citi CompanyRightsourcepro, Inc.Riya Auto Sales & Rental, LLCRonald M. Sidorsky, DPMRose's QB Financial ServicesRTP Environmental Associates, Inc.Ruby Real Estate & Management, Inc.Safe Water Limited Liability CompanySantronix Infosys, LLCSargon Consulting, LLCScienceFirstSentimental Keepsakes by Leah, LLCSierra Allied Health Academy, Inc.Sierra HouseSimmo Construction Co., LLCSinfully Sweet LLCSmart Cents Consulting, LLCSmiling Dogs, LLCSt. Joseph Academy, Inc.Stitch For YouStratis Business CentersSuzanne Garofalo DesignThe Arc of Middlesex CountyThe Concierge Group, LLCThe Liza GroupThe Presbyterian Church at PluckeminThe Radiology Center at HardingThe Tri County JournalThinksolutions, Inc.Three StagesTimber View Properties Inc.Top Cat Cleaning, LLCTwo Guy's Concept, LLCUMS, Underwriters Marketing

Service, Inc.Visionary Economic Business SolutionsWarm SpiritWhat's Going On This Weekend, LLCWISEnterprisesYatek Consulting, LLCZullo Building, Inc.

Since the last edition of Affinity Connections, the following companies have joined the Affinity Federal Credit Union family as SelectEmployee Groups (SEGs). We’d like to thank you for choosing Affinity. If you know of a business that wishes to take advantage ofoffering the benefit of Affinity membership to their associates, please have them call 800-325-0808. We’ll be happy to talk to themabout the Affinity Federal Credit Union difference.

Thank You for Choosing Affinity


73 Mountain View Blvd.Basking Ridge, NJ 07920

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Affinity’s Connections Magazine is printedentirely on Forest Stewardship Councilcertified paper. FSC certification ensures thatthe paper used in this magazine contains fibersfrom well-managed and responsibly harvestedforests that adhere to strict environmental andsocioeconomic standards. Please join Affinity inour commitment to improving the environmentby recycling this magazine.

Printed on recycled paper—50% recycled and 25% post-consumer waste.

Here is a listing of Affinity Public Access Branches and their hours:

Basking Ridge BranchMountain ViewCorporate Center

73 Mountain View Blvd.Basking Ridge, NJ 07920LobbyMonday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-6:00Saturday, 9:00-1:00

Drive UpMonday-Friday, 8:30-6:00Saturday, 9:00-1:00

Bedminster Branch1520 Route 206 NorthBedminster, NJ 07921LobbyMonday-Wednesday, Friday,



Cedar Knolls BranchMorris County Mall235 Ridgedale Ave.Cedar Knolls, NJ 07927Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Denville BranchSaint Clare’s Hospital25 Pocono RoadDenville, NJ 07834Monday-Wednesday, Friday,


Dover BranchSaint Clare’s Hospital400 W. Blackwell StreetDover, NJ 07801Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-4:30

Flemington Branch275 Route 202 South/31 South

Flemington, NJ 08822Monday-Wednesday, Friday,


Hillsborough BranchHillsborough Promenade315 Route 206 NorthHillsborough, NJ 08844Monday-Wednesday, Friday,


Middletown BranchCountry SquareShopping Center

1860 Route 35 SouthMiddletown, NJ 07748Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Morristown BranchCountry Mile Village1098 Mt. Kemble Ave.Morristown, NJ 07960LobbyMonday-Thursday,

8:30-4:00Friday, 8:30-5:00Saturday, 9:00-1:00


New Providence BranchA&P Shopping Center598 Central Ave.New Providence, NJ 07974Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Paramus BranchAT&T Wireless15 East Midland Ave.Paramus, NJ 07652Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-5:30

Piscataway BranchNext to IHOP1342 Centennial Ave.Piscataway, NJ 08854LobbyMonday-Wednesday, Friday,


Drive UpMonday-Wednesday, Friday,


Not near one of these branches? You can also access youraccounts via 50,000 surcharge-free ATMs, 1,700 shared branches,or through Internet Home Banking. For information, visitwww.affinityfcu.org/locator.

F A L L 2 0 0 8

Managing YourMoney in aChanging

Economy

Surviving a Challenging Economy.......................................... 2– A Prudent Approach to Your Balance Sheet

Increase Your Personal Bottom Line...................................... 5– Changing Your Behavior to Save Money

Come On Down!....................................................................... 7– Great Opportunities for Car Buyers

Debt Management................................................................... 9– What You Need to Know

Holiday Shopping....................................................................10– Why Wait Until December?

Is Your Insurance Expendable?..............................................11– Ways to Save and Stay Covered

Your Financial Records............................................................12– How Long Should You Keep Them?

AFFINITY NEWS....................................................................13

WELCOME NEW SEGs .....................................................14– Thank You for Choosing Affinity

IN EVERY ISSUE

I N T H I S

I S S U E

7

10Dear Affinity Member,

If you were a business owner in today’s challengingeconomy, you’d be looking for ways to increaseprofitability by reducing expenses, as well as raisingrevenues. This issue of Affinity Connections isdedicated to helping you do just that.

Our lead article, “Surviving a Challenging Economy,”contains a number of ideas to help you reduceongoing expenses, particularly debt, while positioningyour investment portfolio to withstand today’s volatilemarkets. We also explore strategies to pay less at thegas pumps, including taking a closer look at the wayyou drive and maintain your vehicle.

With gas prices at historic highs, many people arewondering if their next car should be a hybrid. Welook at the advantages and disadvantages and reviewa variety of other important issues to consider whenbuying a new or used car.

Of course, soaring gas prices influence other costs likefood prices and we discuss whether shopping in bulkat places like Sam’s Club® and Costco® really makesmore sense than patronizing your local supermarket.And we even focus on one important expense thatyou probably shouldn’t try to eliminate, no matterhow tempting—your insurance premiums. But thatdoesn’t mean we don’t offer ways to reduce them.

Finally, we provide advice on a variety of other topics,including debt management, a service that seems tobe advertised everywhere these days, and the benefitsof doing your holiday shopping now. As you can see,we’ve packed this issue with information you canuse to make the best of our current economy. Takeadvantage of the opportunities it offers and improveyour personal bottom line.

Best regards,


11

1 Affinity Connections | FALL 2008

5


This newsletter is distributed with the understanding that it does not constitute legal, accounting or other professional advice. Neither Affinity nor any other partywill assume liability for loss or damageas a result of this material. Appropriate legal or accounting advice should be sought from a competent professional. Affinity is not responsible for typographic or inadvertent errors. Affinity FinancialServices is a wholly owned subsidiary of Affinity Federal Credit Union. © 2008 Affinity Federal Credit Union.

Today’s economy is difficult, if not

daunting, for many consumers.

Rising energy and food costs are

taking a bigger bite out of cash flow.

Inflation is up, home prices are

down and many home owners have

been limited in their ability to sell

their property. Investing has become

increasingly challenging with volatile

markets and interest rates lower

than they’ve been in years.

We can’t promise that by following themeasures listed below, you’ll bringprosperity to your life, but we can assureyou that by adopting a prudent, commonsense approach to both sides of yourpersonal balance sheet, you’ll be betterpositioned to withstand the pressures oftoday’s lackluster economy and takeadvantage of whatever opportunities itmight offer.

REDUCING EXPENSES

The right side of your balance sheetrepresents expenses. And while payingless for goods that are increasing in priceis by no means a simple task, it might bepossible if you follow the strategiesdiscussed in our article on pages 5 and 6entitled, “More Ways to Increase YourPersonal Bottom Line.”

One of the most important steps you cantake to reduce expenses is to decrease oreliminate debt. Before you say youcouldn’t possibly do such a thing withoutputting a sizable dent in your savings, let’stake a closer look at the types of debt youmight be carrying.

Surviving aChallengingEconomy

• Credit cards

Do you pay your balances everymonth? Or do you only submit partialpayments and incur finance chargesthat may be as high as 21%?

What makes more sense—to eliminatethese charges or to continue payingthem while your assets earn 2-4% in aCD or money market fund? Use assetsgenerating a low rate of return to payoff high interest debt. And try to limityour impulse buying, so you don’tgenerate new debt.

• Car loans

Unless you’re taking advantage of the0% financing offers that car companiesmake from time to time, take a closerlook at the rate you’re paying. Howdoes it compare to the rates offered byhome equity loans or lines of credit?Generally, home equity loans chargelower rates and the interest you paymay be tax deductible. The key is tofind a home equity loan that allowsyou to pay off your balance in thesame period of time as your car loan.You don’t want to finance a short-termpurchase with long-term debt.

• Mortgages

Rates are low and refinancing yourmortgage can conceivably save youhundreds of dollars a month. Pointsand closing costs are a consideration,so make sure you factor them in whencalculating your overall payments.Also, don’t step backward by takingout a 30-year mortgage when you onlyhave a few years left to pay on yourcurrent loan.

Other debt-related strategies

• You may want to think about makingextra principal payments on your

mortgage. Again, taking money out ofa 2-4% interest bearing account to payfor a 6-8% mortgage makes a lot ofsense. And you’ll reduce your overallinterest payments by thousands ofdollars over the term of your mortgage.

• When you’re contemplating whichaccounts you should tap to pay offdebt, eliminate your IRA or 401(k)from consideration. Assets withdrawnfrom these accounts are subject toincome tax at your tax rate, plus a10% penalty if you’re under age 591⁄2.Besides, these accounts are earmarkedfor your retirement. And with manyretirements lasting 20-30 years orlonger, you’re going to need all theassets you can accumulate.

• Resist the temptation to ignore yourbills or postpone payments until youcan better afford them. You’ll onlyincur finance charges and suffer a blowto your credit rating. Most credit cardcompanies and other creditors willwork with you to establish a paymentschedule that you can manage.

INCREASING ASSETS

Like a business, you have two ways toachieve profitability—reduce expensesand increase revenue. For individuals,revenue comes primarily from your joband your investments. As for your job,now is the time to buckle down andmake yourself indispensable—theunemployment rate may not be upappreciably over the past several years,but clearly, we’re living in an uncertainenvironment. As for your investments, it’stempting to alter your strategy. After all,today’s volatile markets can mean potentiallosses or possible opportunities for gains,depending on your point of view.

In times like these, however, staying thecourse is often the smartest strategy.That’s because the individual investmentsyou select for your portfolio don’tcontribute nearly as much to your overallreturn as the way in which you allocateyour assets across the three major assetclasses—stocks, bonds and cash.


The high cost ofstock market jitters

Before today’s market uncertainties compel you toabandon your equity investments in favor of saferalternatives, consider the chart on the right. It showshow a $10,000 investment would have been affectedby missing the market’s top-performing days over the10-year period from December 31, 1997 to December31, 2007. For example, an individual who remainedinvested for the entire time period would haveaccumulated $17,758, while an investor who missedjust 15 of the top-performing days during that periodwould have accumulated only $9,246.

Source: Standard & Poor’s. Stocks are represented by Standard & Poor’sComposite Index of 500 Stocks, an unmanaged index that is generallyconsidered representative of the U.S. stock market. Past performance isno guarantee of future results.

The chart below illustrates the results of awell known financial study that wasconducted in 1986 and updated five yearslater. The study concludes that 91.5% of aportfolio’s return is attributable to assetallocation, while only 4.6% is attributableto stock selection.

The right allocation for one person,however, may be totally wrong foranother. Your allocation should be areflection of your objectives, time horizon,need for liquidity, risk tolerance and otherfactors. To develop it, you should consultwith your financial advisor or use the freeanalytical tools available at websites suchas www.mint.com or www.kiplinger.com.

Once you arrive at an appropriateallocation, you should diversify yourholdings within each asset class. Forexample, stocks or mutual funds thatinvest in stocks may be diversified bymarket capitalization, geographic locationand investment style. Bonds, CDs andother fixed income investments shouldvary by maturity. In fact, many astute

fixed income investors ladder theirportfolios with securities that matureseveral months (or years) apart in order toprotect themselves against unpredictableinterest rate fluctuations.

THE KEY TO ANY ECONOMY . . .

. . . is to adopt a consistent approach toboth debt and investment management.The best approach enables you to takeadvantage of potential opportunitiesand avoid unnecessary risk. The currenteconomy is challenging, but by reducingdebt, controlling expenses and diversifyingyour investments, you’ll not only survive it,but position yourself for the upturn whenit finally does occur.


What Can You Doto Increase Your

Bottom Line?

Affinity’s Financial Advisors can help you review strategiesto improve your investment return. Call 800-325-0808 or visitwww.affinityfcu.org.

StayInvested

MissTop5 Days

MissTop

10 Days

MissTop

15 Days

MissTop

20 Days

MissTop

25 Days

MissTop

30 Days

$20,000

$15,000

$10,000

$5,000

$0

$17,758

$13,782

$11,189

$9,246

$7,745

$6,547$5,587

Stock Selection4.6%

Other2.0%

Market Timing1.8%

Asset Allocation Decisions91.5%

Source: Brinson, Singer & Beebower



Notice something about today’s gas

prices other than the fact that

they’re skyrocketing?

They’re beginning to change

people’s behavior.

Maybe you simply don’t drive as much asyou did before or at least think twicebefore you turn the ignition. Maybe youfind yourself buying $20-$30 worth of gasbecause you somehow feel it’s lessupsetting than spending $60-$70 to fillthe tank. Or perhaps you’re starting to

wonder if your next car should be ahybrid or at least something other thanan SUV.

There are ways to reduce not only yourgas costs but the costs of the goods thathave risen because of increased gas prices.

Let’s start with your behavior at the pump:

• Do you really need premium?

What does your owner’s manual say?Some automobile manufacturers requirehigh octane gas for certain models,while others only recommend it.

If high octane gas is required for yourcar, bite the bullet and pay the extramoney. Failure to do so may damageyour engine. However, if high octanegas is only recommended, you have adecision to make.

Fifteen to twenty years ago, fueling ahigh performance car with regular gascaused engine knock and vibration.Today, however, computerized sensorstypically adjust your engine’s timing forthe type of fuel you use. The result? Noknocks, but possibly a slight reductionin performance and fuel economy. If this

More Ways toIncreaseYour Personal Bottom Line

by Decreasing Day-to-Day Expenses


Make More MoneyWhile You Save

Increase your earnings with Affinity Green Rewards Checking.Good for you, good for the environment too!Visit www.affinity.fcu.org/greenrewards or call 800-325-0808 today.

is unacceptable to you, buy the gasrecommended by your car manufacturer.If not, fill ‘er up with regular.

One more thing—there are absolutelyno benefits to be derived from usinghigh octane gas in a car that doesn’trequire it. You might as well be burningthe additional money you spend.

• Can you buy no-name gas?

Gas is a fungible commodity. Thatmeans it doesn’t differ regardless ofwhere you purchase it. However, majoroil companies often add a detergent totheir gas that may have a positiveimpact on engine deposits. If you’replanning to keep your car for a longtime, you may want to take advantageof these benefits and limit no-namegas purchases to every second orthird fill-up.

• What about once you leave the gasstation? What else can you do?

The way you drive and maintain yourcar can have a major impact on howmuch gas it uses. For example:

• Keeping your engine tuned canincrease gas mileage by an averageof 4%.

• Replacing clogged air filters canincrease gas mileage by up to 10%.

• Removing 100 lbs. of the junk you’veallowed to accumulate in your trunkcan increase gas mileage by 2%.

• Keeping your tires properly inflatedand aligned can increase gas mileageby up to 3%.

• Obeying posted speed limits canreally save you money. Driving at55 mph can actually increase fueleconomy by 21% versus drivingat 70 mph.

There—we just increased your fueleconomy by 40%. And that’s not evencounting no-brainers like avoidingunnecessary idling while you’re waitingfor someone.

BEYOND GAS SAVINGS

The high cost of fuel has impacted thecost of manufacturing and deliveringgoods. These higher costs have beenpassed on to you. What can you doabout them?

Many people have begun relying on storeslike Costco and Sam’s Club that sell bulkitems, reducing the number of trips to thelocal grocery store. Is the savings worththe effort?

Maybe.

Buying vegetable oil in mammothcontainers and 10 packs of aluminum foilmay add up to hundreds of dollars insavings a year. But depending on thegoods involved, you may actually dobetter at your local supermarket oroffice supply store.

The key is looking at per unitcost—how much do the goodscost per ounce, pound or otherbasic measure. Surprisingly,bulk is not always going tobe the best, although often itcan be.

In addition, you shouldthink about whether youwill actually use suchlarge quantities of whatmight be perishablegoods before theirexpiration date.

And, of course, there’s the question ofstorage. Do you have enough room tokeep bulk items where you can accessthem conveniently?

Finally, once you bring bulk items home,use them to generate even more costsavings. Drop the tall skim latte habit infavor of brewing your own coffee at homeand bringing it with you. Dip into yourstash of 500 paper bags to brown bagyour lunch. Freeze chicken or beef indinner-size packets. The possibilitiesare endless!

Source: www.edmunds.com

The combination of rising gas

prices and a sagging economy has

slowed car sales to a point that

dealers are offering a wide variety

of rebates, financing arrangements

and other incentives. Should you

take advantage of them?

If you’ve been thinking about shoppingfor a car, now is a great time. It’s helpful,however, to make certain you’veconsidered the following issues beforeyou begin:

2009 OR 2008?

It depends. Dealers traditionally offerwhatever current year models are left ontheir lot at a substantial discount. Youshould realize, however, that the minuteyou drive out of the lot, your car will beworth considerably less than a 2009model, particularly if the 2009 model haschanged substantially. If you plan to driveyour car “until the wheels fall off,” you maynot be concerned about future trade-in orresale value. But, if you typically buy a carevery 3-5 years, you might think aboutnegotiating a great deal on a 2009 modelto ensure a better trade-in value.

NEW OR USED?

Tough call. The benefits of each areobvious—new car panache vs. used carpracticality. Clearly, a used car costs lessthan a new one, but it may also be poisedfor major unwarrantied repairs,depending on its age and condition. Ifyou go the used car route, make certainyou check its title through a service likeCARFAX (www.carfax.com) to determinewhether the car has ever been:

• Seriously damaged in an accident ornatural disaster

• Repossessed

• Returned as a lemon

Checking the title can also inform youwhether the car’s odometer has ever beenrolled back.


Come ondown!

Today’s economy offersgreat opportunities

for car buyers


LEASE OR LOAN?

There’s no right or wrong answer. Peoplegenerally lease because monthly paymentsare lower and they enjoy driving a newcar every 3-5 years. Lower monthlypayments, however, do not mean thatleasing is less expensive than borrowing.With leasing, you’re making paymentscontinually over the term of the lease.Moreover, you may be subject to variousfees every time you enter a new lease.With borrowing, of course, yourpayments ultimately end at some pointand you own the car outright. The valueof your car, however, will be substantiallylower than it was when you purchased it.

So how should you proceed? Perhapsthe following considerations will helpyou decide:

• How many miles a year do you drive?

Leases usually limit you to 12,000 or15,000 miles per year. By driving moremiles than your allotted amount, you’llbe subject to stiff mileage penalties atthe end of your lease.

• How hard are you on your car?

Just because you don’t actually ownyour car doesn’t mean you don’t have totake care of it. Excessive wear and tear,mismatched tires and assorted dingswill end up costing you more moneythan repairs and replacements as theyare needed.

• How long do you plan to keepyour car?

The longer you typically keep a car, themore it makes sense to purchase it. If youkeep your cars for only 3-5 years, youmight consider leasing as an alternative.

• How much do you wish to avoid aninitial cash outlay?

Leasing generally requires a loweroutlay of cash initially than financing.You can finance 100% of the cost ofyour vehicle, but monthly paymentswill be much higher than thoseavailable through leasing. You shouldrealize, however, that leasing oftenrequires up-front fees, as well aspossible down payments, if you wish toreduce your monthly payments.

CAR LOAN OR HOME EQUITYLOAN?

We touch upon this in our article entitled,“Surviving a Challenging Economy,” onpage 2. Home equity loans offer lowerinterest rates than car loans. What’s more,the interest you do pay may be taxdeductible. Home equity loans, however,are typically only available with 5 year orlonger terms. In an apples-to-applesscenario—5 year car loan vs. 5 year homeequity loan—the home equity loan is thesuperior alternative. But if you wish topay off your car in 2-3 years, you mayfind that a home equity loan will cost youmore in interest payments over itsduration . . . that is, of course, unless youmake additional principal payments toyour home equity loan that will enable youto pay it off in a shorter period of time.

HYBRID OR NOT?

Today’s gas prices have even confirmedSUV drivers wondering if they shouldreorder their priorities. After all, don’thybrids get 45-55 miles per gallon?

Except, the mileage you get from yourhybrid depends on how you drive it. Ifyou drive primarily on highways, you maynot get many more miles to a gallon than

you would with a non-hybrid equivalent.If you have a lead foot when the lightturns green, ditto. If you live in acongested area where you do a lot of stop-and-go driving, however, you may find ahybrid to be a thriftier alternative at thegas pump. Furthermore, hybrids run upto 80% cleaner than conventional gasengines and have substantially loweremissions.

Rising gas prices have caused a significantspike in hybrid prices. A hybrid HondaCivic, for example, costs 33% morethan its non-hybrid counterpart. Ahybrid Camry costs 36% more than aconventional Camry. And with demandexceeding supply, the difference maywiden. You have to decide whether thegas savings you achieve is worth the pricedifferential. And you have to be honestabout your driving habits—will they helpyou achieve the gas savings possiblethrough a hybrid or will they negate thepotential benefits?

LOYALTY PAYS

Especially in a difficult sales environment,automobile manufacturers and dealersoffer loyalty incentives to currentcustomers. In other words, if you alreadyown a GM car, you may stand to receivecash back when you buy another one. Ifyou already lease a Ford, you mightreceive a lower interest rate on a newlease. Or you might receive other benefitslike a reduction in excess mileage chargesor waiver of fees or security deposits.

While incentive programs are often wellpublicized, they are sometimes onlyavailable to customers who ask aboutthem. So don’t be shy. You have nothingto lose except sticker price.

In the Market for aNew or Used Car?

Affinity can help you find your dream car and choose the rightfinancing plan. Visit www.affinityfcu.org or call 800-325-0808 today!

You knowyou might

need debtmanagement

counseling when youbegin to identify with the people in theTV commercials:

• You’re being harassed by phone callsfrom creditors and collection agencies.

• You can barely pay your credit cardminimums.

• You’re constantly late with your invoicepayments.

• You haven’t been able to work out areasonable payment plan with creditors.

Maybe you should do what the commercialsays and call the toll-free number to freeyourself of debt and take steps to restoreyour peace of mind.

Or maybe you shouldn’t.

Debt management counseling has becomea $7 billion industry in the U.S. withbankruptcies high and consumer debt atrecord levels. Not all debt counselors arealike. And some can leave you in evenworse financial shape than you were whenyou made the initial call.

Here’s what you should know before youpick up the phone:

• Counseling is key . . .

Reputable debt counselors should offersuch services as personalized budgetcounseling and courses in savings anddebt management. Counselors should betrained and certified in consumer credit,budgeting and money management. And

they should be willing to meet with youon an individual basis.

• . . . and so is accreditation

A Department of Justice ruling thatanyone planning to file for bankruptcymust first complete a pre-filingcounseling session has given birth to aproliferation of debt managementcompanies. Make sure the companiesyou’re considering meet the standards ofthird party sources like the United StatesTrustee Program (www.usdoj.gov/ust)or the National Foundation for CreditCounseling, a 50-year old organizationwith strict accreditation guidelines(www.debtadvice.com).

• Debt management programs may be aviable solution, but . . .

. . . they shouldn’t be the first and onlyoption offered by the company you’reconsidering. With a debt managementplan, the counseling company negotiateswith your creditors to reduce fees,finance charges and interest rates whilescheduling a repayment plan. Youdeposit money with the counselingcompany every month and thecounseling company pays your creditors.

If you do participate in a debt managementplan make certain you determine:

• How long the plan will be in effect

Many plans take 48 months or more tocomplete and require you to avoid usingor applying for credit. Be wary of open-ended plans. Your counselor should atleast be able to give you an estimate ofyour plan’s duration.

• How much the plan will cost

Debt management plans typically requirea set-up fee and a monthly payment,both of which may range from $10 tounconscionable amounts. The counselingcompany may also receive paymentsfrom your creditors. Make sure you shoparound as fees vary greatly. And, if youare asked for substantial up-front fees,find another counselor.

• If your creditors are really being paid

Check your creditors’ monthlystatements to make certain yourcounseling company is fulfilling itspromises. Also check to determinewhether payments are being made ontime. Late payments, of course, canadversely affect your credit rating.

You should realize that participation in adebt management plan can impact yourcredit rating, even if your plan pays yourcreditors on a timely basis. In addition,some creditors may not want to doadditional business with you after you’vecompleted your plan, but others will.In fact, many believe that debt counselingis a positive sign that a customer is gettinghis or her debts under control. And it iscertainly a less onerous alternative thandeclaring bankruptcy.

The counseling companies advertising onTV and radio aren’t your only options.According to the Federal TradeCommission, many universities, militarybases, credit unions, housing authoritiesand branches of the U.S. CooperativeExtension Service operate non-profit debtmanagement programs. For moreinformation, visit www.ftc.gov.


What you should knowbeforeyou call the 800 number

Do You NeedDebt Management

Counseling?

Look to Affinity’s free Budget and Credit Score Enhancement Service(BASES) for the answer. Learn more at www.affinityfcu.org orcall 800-325-0808.

DebtManagement:



Shop Now,Save Now.

With an Affinity Club Account you can save for those holiday purchasesall year long. To find out about our savings accounts call 800-325-0808or visit www.affinityfcu.org.

Whywaituntil December to do yourholiday shopping?

In the past, towns began to decorate

their main streets for the holidays

right after Thanksgiving. Today,

Halloween seems to be the starting

point. But for savvy shoppers,

would you believe Labor Day?

It’s not too early to begin making yourshopping list, checking it twice and loggingonto the Internet to start shopping. Today’sdifficult economy is especially rough onretailers, many of whom have alreadybegun marking down merchandise. To takeadvantage of this environment, here are afew ideas to consider:

• Collect promotional codes forimmediate discounts

How many times have you purchasedsomething online and been asked toprovide a promotional code that youdidn’t have at checkout? The fact thatyou were asked indicates that a code isavailable, but where can you find it?

Next time you’re asked, open upanother window and:

– Check Google

Enter the phrase used by themerchant—promotional code orcoupon, for example—and the nameof the merchant. Chances are, you’llfind codes that can save youmeaningful dollars on the purchaseyou were about to make.

– Check other websites

You might also be able to findcoupons or promotional codes onsites such as www.CouponCabin.com,www.FatWallet.com andwww.Keycode.com. These sitescontain numerous promotional codes,discount coupons and cash-backoffers from a variety of retailers.

• Compare prices without visitingdifferent websites

Are you really getting the lowestprice possible? Instead of shoppingat the websites of individual retailers,why not visit consolidated shoppingsites like www.shopping.msn.com orwww.shopping.yahoo.com? You canview side-by-side comparisons that will

enable you to purchase merchandise fromthe retailer offering the lowest price.

PAYING FOR YOUR PURCHASES

Whether you shop online or in person,consider paying by credit card. Under theFair Billing Credit Act, purchases made bycredit card offer an added level ofprotection. Specifically:

• You are limited to $50 liability fordisputed or fraudulent charges, withmany credit card providers waiving thismaximum.

• You have the right to withhold paymentwhile charges are being investigated.

• You have the right to deny payment, ifmerchandise shipped to you is defective.

• Many credit cards offer additional buyerprotection benefits such as extendedwarranties and refunds in the event thatpurchases are damaged or stolen withina specified period of time.

So just because the holidays are a fewmonths away, that’s no reason to delaychecking off your shopping list. Your earlyaction can result in substantial savings.


Admit it—those insurance

premiums can be an expense that’s

hard to justify in a difficult

economy. And maybe you’ve even

wondered if you should drop your

coverage and pick it up again when

the economy turns around.

Insurance is probably the last expenseyou should give up in a difficult or,for that matter, a thriving economy.However, there might be ways to reduceyour premiums:

LIFE INSURANCE

Life insurance premiums are basedprimarily on age and health. If you dropyour policy today with the intention ofpurchasing another one at some point inthe future, you may find that yourpremiums will be higher, simply becauseyou’re older. Moreover, you may not be ashealthy when you’re ready to resumeyour coverage. Also, depending on thenature of your condition, you will payconsiderably higher premiums or perhapsbe deemed “uninsurable.” This means thatthe insurance company will not assumethe risk of covering you.

If you have whole, universal or variablelife insurance that earns cash value, youmay be able to skip a premium or pay

a lower premium now and then,depending on how much cash is in thepolicy. Or you may consider replacingyour policy with low cost term insurancethat offers protection only without cashvalue accumulation.

AUTO INSURANCE

Clearly, you have no choice but to retainyour auto insurance unless you plan totrade in your car for a skateboard.However, you might be able to reduceyour premiums by:

• Raising deductibles on collision andcomprehensive

According to the Ohio InsuranceInstitute, raising deductibles from $200to $500 can reduce collision andcomprehensive premiums by 15-30%.Raising it to $1000 can reduce premiumsby considerably more.1 And you’ll still beprotected in the event of a major loss.Your insurance company can advise youon the specific savings you may realize.

• Eliminating collision andcomprehensive coverage

Experts suggest that if the cost of yourcollision and comprehensive insurancefor your vehicle is more than 10% of itscurrent value, you’ll pay more to insureit than the amount of money you’llreceive in the event of an accident.2

Check your vehicle’s value with an autodealer or through a third party sourcelike Kelley Blue Book (www.kbb.com).

DISABILITY INSURANCE

Disability insurance can be expensive,especially if you have to purchase it onyour own because you’re not eligible forgroup coverage through your employer.Dropping coverage, however, can becatastrophic if you suddenly becomedisabled and find you need benefits.

If you’re concerned about how you’re goingto afford your disability policy, consider:

• Lowering the monthly benefit youwould receive if you became disabled.

• Increasing the waiting period beforebenefits begin.

• Checking your policy to make certainyou’re not paying for optional coveragesthat would be “nice to have” but aren’treally mandatory.

Remember—you purchased your variousinsurance policies to protect yourself andyour loved ones from the unexpected. Bydropping coverages, you run the very realrisk of placing your family in far greaterjeopardy than they face in a difficulteconomic environment.

Endnotes:

1 Ohio Insurance Facts, 11/2007

2 Smart Money, “How much auto insurance do you need?”

Is Your Insurance

Expendable?

Can YourInsurance

be Improved?

Paying too much? Not protected adequately? Affinity InsuranceSpecialists can help you find out for sure. Visit www.affinityfcu.org orcall 800-325-0808.


Want More Detailed Information?

Visit www.bankrate.com to see a comprehensive list of how longyou should keep various records.

How LongShould You StoreYourFinancial Records?

Documents How long should you keep them?

Tax Returns Seven years, to be safe. The IRS has three years to audityour return and six years if it thinks you under-reportedyour gross income by 25% or more.

RetirementPlan/SavingsAccounts

Keep your quarterly statements until you receive yourannual summary, at which point you may shred them. Keepannual summaries until you retire or close the account.

BrokerageStatementsand TradeConfirmations

Keep them at least until you sell the securities. However,you will need records of prices for which you bought andsold securities to determine whether you have capital gainsor losses at tax time. As a result, you may want to keepthis information for as long as you keep your tax returns, incase you are audited by the IRS at some point in the future.

Bank andCredit UnionRecords

Discard cancelled checks that have no long-termimportance, but keep those that represent major, long-term purchases.

Credit CardReceipts andStatements

Keep your original receipts until you receive yourstatement. For tax-related expenses, keep yourstatements for the same seven year period you keepyour tax returns.

Pay Stubs When you receive your W-2 form for taxes, make surethe information matches that which is on your pay stubs.At that point, you can shred the stubs.

Bills Once you receive a cancelled check, you can generallydiscard invoices or bills. However, you should keepinvoices for major purchases, so you have a record oftheir value in the event of loss or damage.

IRAContributions

Permanently. When you take money out of your IRA atretirement, you’ll need to prove whether you’ve alreadypaid tax on contributions you’ve made.

Don’t forget—the same rules apply if you receive your financial statementsand other records online instead of through the mail.

Tax returns, bank and brokerage statements, credit card receipts—Americans are inundated by paper that keeps arriving month after monthand, sooner or later, overwhelms even the most diligent record keepers.

If your file drawers are already stuffed with documents and you’rewondering where you’re going to file new ones, here are a few tips on howlong you should keep various financial records before shredding them:


A F F I N I T Y N EW S

Taking Political Action – Affinity continues tobuild support in order to protect credit unions.

Affinity’s primary focus has always been the financial health andwell-being of our members. This includes protecting yourinterests in the political arena.

Affinity’s Political Action Committee (PAC) and Regulatory andPolitical Issues Committee work together to educate legislatorsabout the benefits of credit unions. We meet with legislatorsto explain what credit unions are, how they differ from banks,and how that difference benefits families across America. As aresult, many legislators have pledged their support for regulatoryrelief, including the retention of the credit union tax exemptstatus. Affinity supports these Congressmen and we urgeyou to consider how their support plays a large role in thecontinuing strength of your rights as a credit union member.

Is your Congressman supporting credit unions? Here are a fewof the New Jersey legislators that do support credit unions:

• Congressman Rob Andrews (D-District 1)

• Congressman Frank LoBiondo (R-District 2)

• Congressman Scott Garrett (R-District 5)

• Congressman Frank Pallone (D-District 6)

• Congressman Michael Ferguson (R-District 7)

• Congressman Bill Pascrell (D-District 8)

• Congressman Steve Rothman (D-District 9)

• Congressman Donald Payne (D-District 10)

• Congressman Rodney Frelinghuysen (R-District 11)

• Congressman Rush Holt (D-District 12)

• Congressman Albio Sires (D-District 13)

Community News

Announcing Affinity’s EasyFLEX Home EquityLine of Credit

Imagine a home equity line of credit so flexible it gives youexactly what you need, when you need it. Like most lines ofcredit, you get immediate access to cash for any purpose.But with EasyFLEX, you can also take out up to three fixed-rate loans at any one time. The only requirement is thatyou stay within your approved EasyFLEX limit.Visit www.affinityfcu.org/easyflex,call 800-325-0808, or visit any Affinity branch.

Congratulations to the 2008 AffinityScholarship Recipients

Jessica DePrima - Basking Ridge, NJ,Monmouth University

Keiona Eady - Cross, SC,Clemson University

Thabo D’Anjou - Scotch Plains, NJ,Howard University

Crystal Himes - Piscataway, NJ,Cornell University

Andy Yuan-Jay Lee - Basking Ridge, NJ,George Washington University

Brian D. Thorne - Lebanon, NJ,Kenyon College

Coming Soon—New Affinity Branch inFlemington, NJ

Our newest branch will be located at 275 Route 202 South/31 South in Flemington, NJ just south of the FlemingtonCircle. The new 4,100 square foot facility will feature fullbranch services, as well as many extras including coffee, safedeposit boxes, a children's activity area, an Internet café and asmall meeting room available for members and communityorganizations to use.

Hours of operation will be 8:30 am to 6:00 pm on Monday,Tuesday, Wednesday and Friday; 8:30 am to 7:00 pm onThursday, and 9:00 am to 1:00 pm on Saturday.

Mark your calendar for these upcoming business events:

• Business Networking Event - Wednesday, October 15th at6:30 pm. Make new contacts and learn how Affinity canhelp your business grow.

• Franchise Ownership Workshop - Tuesday, November 11thfrom 6:30 pm - 8:30 pm. Learn the common myths andmisconceptions about franchises, franchise opportunities,legal obligations of owners and financing options.

Stay tuned for information about our Grand Openingcelebration, which will feature special offers and giveaways.For more information on the Affinity Flemington Branch, visitwww.affinityfcu.org/flemington or call 800-325-0808,ext. 3550.

WELCOME


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Autobody, Inc.Office Solutions, Inc.Pawtastic Pet Sitting, LLCPBR Group, LLCPerfect Storm Apparel, LLCPerfection DetailingPhotografismPlaza Lanes Inc.PRUDENTMDR&N Transport, LLCRevelation Kids, LLCRiverview Lawns, LLCRMKANE Consulting, LLCSam Ash & CompanySandello's Plumbing & HeatingSeaGate International, LLCSincere LegendsSneha Software SolutionsSPG TennisStinky Pete's Grooming

Salon, LLCSTL Systems, LLCStorage Assets, LLC DBA

Lackland Self StorageTaamba Hardware CompanyTents, Chairs & Party

Wares, Inc. T/A AdamsRental & Sales

The Historical Society ofthe Somerset Hills

The Trademark Company, LLCTony R. Construction, Inc.Total Health Physical

Medicine &Rehabilitation Center

Totowa Pediatric GroupTownship Of Mt. OliveTradition Home

RemodelingUnclejesses Travel/

World VenturesVision Systems Group, Inc.Whitlock PackagingCorporationWorld GymZ Mark, LLC

Since the last edition of Affinity Connections, the following companies have joined theAffinity Federal Credit Union family as Select Employee Groups (SEGs). We’d like to thankyou for choosing Affinity. If you know of a business that wishes to take advantage of offeringthe benefit of Affinity membership to their associates, please have them call 800-325-0808.We’ll be happy to talk to them about the Affinity Federal Credit Union difference.

Thank You for Choosing Affinity


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Mountain View BranchMountain ViewCorporate Center




Bedminster Branch1520 Route 206 NorthBedminster, NJ 07921LobbyMonday-Wednesday, Friday,



Cedar Knolls BranchMorris County Mall235 Ridgedale Ave.Cedar Knolls, NJ 07927Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Denville BranchSaint Clare’s Hospital25 Pocono RoadDenville, NJ 07834Monday-Wednesday, Friday,


Dover BranchSaint Clare’s Hospital400 W. Blackwell StreetDover, NJ 07801Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-4:30

Hillsborough BranchHillsborough Promenade315 Route 206 NorthHillsborough, NJ 08844Monday-Wednesday, Friday,


Middletown BranchCountry SquareShopping Center


Morristown BranchCountry Mile Village1098 Mt. Kemble Ave.Morristown, NJ 07960LobbyMonday-Thursday,

8:30-4:00Friday, 8:30-5:00Saturday, 9:00-1:00


New Providence BranchA&P Shopping Center598 Central Ave.New Providence, NJ 07974Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Paramus BranchAT&T Wireless15 East Midland Ave.Paramus, NJ 07652Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-5:30

Piscataway BranchNext to IHOP1342 Centennial Ave.Piscataway, NJ 08854LobbyMonday-Wednesday, Friday,




Not near one of these branches? You can also access youraccounts via 50,000 surcharge-free ATMs, 1,700 shared branches,or through Internet Home Banking. For information, visitwww.affinityfcu.org/locator.

F A L L 2 0 0 7

GoingGreen toProtect thePlanet(and Save Money)

Investing 101 ................................................................2– Be Prepared with Basic Principles

Going Green ................................................................3– Doing Your Part

Business Insurance ........................................................6– Choosing a Plan Wisely

Enjoying Retirement ....................................................8– Create a Dependable Income

Tax Tune-Up ..............................................................10– Get Ready Now

Fraud Alert ................................................................12– Beware of Lottery Scams

AFFINITY NEWS ..................................................13

WELCOME NEW SEGs ......................................14– Thank You for Choosing Affinity

IN EVERY ISSUE

I N T H I S

I S S U E 3

8

10

Dear Affinity Member,

The consumption and conservation of energy are quickly becoming some of the world's mostpressing issues.

Fortunately, some solutions are already underway.According to a recent energy report in The WallStreet Journal, alternative energy sources such aswind and solar power are becoming more pricecompetitive in relation to traditional fossil fuelssuch as coal and natural gas. These alternativeenergy sources stand to gain momentum in theyears ahead.

In the meantime, as alternative energy is beinghoned and improved, we can all do our part tohelp leave less of an imprint on the planet bychanging the way we live. Even if each of ustakes small steps—such as using ecologicallyfriendly products or taking advantage of thenew federal energy tax initiatives—we can beginto forge a path toward a greener and cleanerenvironment.

This issue of Affinity Connectionsprovides simple ideas you can useto reduce waste, conserve energyand save money. At Affinity FederalCredit Union, we believe thattaking steps to conserve energyand natural resources will providepersonal, professional and financialbenefits for us all in the future.

Best regards,


6


You don’t have to be wealthy to enter theworld of investing. It is important, however,that you understand some of the basicprinciples, as the world of investing is not a place to explore without adequatepreparation.

WHAT IS INVESTING?

Investing is putting your money to workin order to make more money. Unlikesaving, where your principal remainsconstant and your money earns interest,investments can fluctuate over time,so you need to be comfortable withtaking risks.

RISK AND RETURN

Every investment is two-dimensional—a function of risk and return. The higher the potential for return, thegreater the potential risk to lose moneyon your investments.

All investors, from the novice to the mostadvanced, must accept a certain level ofrisk in order to gain a return. Theacceptable level varies from individual to individual.

A BALANCED INVESTMENT PLANSTARTS FROM THE BOTTOM UP

A balanced investment plan takes intoconsideration what you can afford toinvest along with your tolerance for risk.It should help you achieve certainfinancial goals. The financial goals youset for yourself are the reasons why youare investing in the first place. Why areyou investing? To earn income? To reacha specific goal such as a new home or asecure retirement?

A solid plan is built from the bottom upand is well diversified. Look at theinvestment pyramid at the left. At the baseis the money you want to keep safe andrelatively liquid. Here you’ll

find the majority of your assets, includingsavings accounts; certificates of deposit;money market funds; U.S. Treasury bills,notes and bonds—all of which establish afirm foundation.

After you’ve built a solid base you canmove further up the pyramid to wherethe risk-reward ratio becomes greater.Balanced mutual funds, high-grademunicipal and corporate bonds as well asblue chip stocks all have the potential forgreater return.

At the peak of the pyramid are the mostrisky and illiquid investments. Only themost aggressive investors venture to thispoint, as these investments have the mostunpredictable results. Investments in thiscategory may include high-yield (junk)bonds, speculative stocks, raw land,stock options and futures.

DIVERSIFICATION

There are many ways to manageinvestment risk. One effective way isthrough diversification. By spreading yourmoney among many different types ofinvestments, you reduce the impact thatany one may have on your portfolio—soall your eggs are never in one basket.

Affinity CanHelp You Build

Your InvestmentPortfolio

Affinity can help you examine your tolerance for risk and seek outthe investments that best meet your objectives. Call 800-325-0808to speak with an Affinity Financial Consultant today.

A Mini-Coursein Investing

Speculative

Stocks

Bonds

Cash


INVESTING 101


This newsletter is distributed with the understanding that it does not constitute legal, accounting or other professional advice. Neither Affinity nor any other party will assume liability for loss or damageas a result of this material. Appropriate legal or accounting advice should be sought from a competent professional. Affinity is not responsible for typographic or inadvertent errors. Affinity FinancialServices is a wholly owned subsidiary of Affinity Federal Credit Union. © 2007 Affinity Federal Credit Union.

Consider this:

• According to the U.S. EnvironmentalProtection Agency (EPA), the averageAmerican household is twice asresponsible for greenhouse gasemissions as the average car.

• For every ton of household waste,another 70 tons of manufacturing waste is created.1

What does this mean to us as a society? Itmeans that even the smallest of positivelifestyle changes we make in our homestoday can have long-lasting beneficialeffects for tomorrow. You need not spenda bundle to do it. Conversely, you mayactually save money by changing to aneco-friendly lifestyle.

LIVE UNPLUGGED

According to the U.S. Energy InformationAdministration (EIA), householdoperations account for about 20 percentof the greenhouse gas emissions thatcontribute to global climate change. Aportion of these emissions is attributed to electricity used in the home.

What do you have plugged in? Cellphones, chargers, laptops, printers, TVs?Many of these products (as well as small

appliances like coffee pots and toasters)are “energy vampires” that suck energyeven when turned off! By simplyunplugging items and turning off lightsyou will save on energy costs andminimize carbon dioxide emissions.

The chart below shows stand-by powerusage of some common householdappliances.

CHOOSE ENERGY-EFFICIENTAPPLIANCES AND OTHER PRODUCTS

Another way to reduce energyconsumption is to upgrade to more

efficient products. The EPA has created aprogram called EnergyStar® which certifiesproducts that save energy. Today’sEnergyStar washers, dryers, ovens,dishwashers and other products, such asthe new compact fluorescent lightbulbs(CFLs), not only save energy but lastlonger, too. All told, a homeowner thatswitches over to all EnergyStar eco-friendly appliances can expect about a 30 percent reduction in energy bills andgreenhouse gas emissions.

Your Home: Make Your World a Greener and Cleaner Place


Appliance Category Appliance Power Consumption

In Watts

Min Avg Max

Portable Stereo 0.7 2.2 7.7Audio Component System 1.1 3.0 15.1

DVD Player 1.3 4.2 12.0

Kitchen Microwave Oven 0.0 2.9 6.0

Computer 0.0 1.7 3.5Office Printer, Ink/BubbleJet 4.0 5.0 6.0

Phone/Fax/Copier 1.3 1.5 1.6

Cable Box 4.6 10.8 24.7Set-top Boxes Internet Terminal/Modem 4.4 10.6 18.8

Satellite System 8.8 12.6 18.8

TelephonyAnswering Machine 1.8 3.0 5.2Cordless Phone 1.1 2.6 5.0

TV-VCRTelevision 0.0 5.0 21.6TV/VCR 1.1 7.6 19.5

Chart Source: www.consumerenergycenter.org/myths/appliances.html

It’s undeniable that how we live affects the planet. If each of us takes steps to leave a minimal

environmental impact or what’s known as a “softer footprint”—working with nature instead of

against it—we can work to preserve the Earth’s resources.

Fortunately, new energy-efficient innovations have made it easier (and cheaper) for us all to be

green in the twenty-first century. And even if you aren’t ready to invest in big-ticket, eco-friendly

technology, some simple, common-sense approaches to energy-efficient living can help you save

money in the home and on the road.

Going Green to Protect the Planet (and Save Money)

HEAT AND COOL YOUR HOMEEFFICIENTLY

Almost 50 cents of every dollar of yourhome’s utility bill can be attributed toheating/cooling the home. You can reduceenergy waste by installing proper insulation,caulking and weatherstripping as well asupgrading to new energy-efficient windowsand doors.

Other fast energy-efficient fixes include:using programmable thermostats; regularlyservicing your heating and cooling units;turning down hot water heater temperatures;and closing your fireplace damper.

WASTE LESS BY REUSINGPRODUCTS

According to the EIA, Americans generate more garbage and use moreresources than any other country. In fact, the average citizen produces morethan 1,000 pounds of trash each year! By buying only what you need and usingproducts that can be reused rather thandisposed of, we can help reduce waste aswell as emissions.

Some easy ways to reduce waste include:buying large single containers for long orunlimited shelf-life items like laundrydetergent; avoiding single or limited-useitems, such as disposable razors or foilbaking pans; carrying a reusable canvas orstring bag instead of paper or plastic bagsfor shopping.

IF YOU CAN’T REUSE, RECYCLE

Recycling plastic, cans, glass and papersignificantly reduces the amount of litterending up in landfills and reachingmarine and coastal waters.

What’s more, recycling:

• Decreases emissions of greenhouse gases that can contribute to globalclimate change

• Conserves natural resources such astimber, water, and minerals

• Helps sustain the environment forfuture generations

To learn more about the importance of recycling, visit www.epa.gov/msw/recycle.htm on the web.

Endnotes:

1. The Hidden Life of Garbage ©2005 Heather Rogers

Sources and further reading:

• www.policycouncil.nationaljournal.com

• www.epa.gov

• www.eia.doe.gov


Federal Tax Breaks forGreen Homeowners

The federal government offers tax creditsfor homeowners who take advantage ofnew solar technology and/or install energy-efficient windows, insulation, doors, androofs, as well as heating and coolingequipment. These credits are available forsystems placed in service from January 1,2006 to December 31, 2008. To learnmore, visit www.energy.gov/taxbreaks.htmon the web.

t the Planet (and Save Money)

How Much Energy IsYour House Using? Try This Calculator!

You can measure your energy use onlineto get a picture of how much energy yourhousehold consumes. Go towww.epa.gov/climatechange/emissions/ind_calculator.html on the web.

Want to Do Your Part for

the Planet?

Sign up for Affinity online statements! Just visit www.affinityfcu.org,log in to “Home Banking,” select “Account Access,” then click on“Online Statements.” For more information or to sign up forHome Banking call 800-325-0808.


Combined with energy usage in the home,more than 2.3 billion metric tons ofenergy-related carbon dioxide emissionsare produced annually by America's roadwarriors.1 Ready to tackle the emissionsproblem? Walking or bicycling to workare two of the best ways to cut emissions.However, if you live more than a fewmiles from the office, as many of us do(or you simply don’t want to be seen atwork every morning in your bicyclingtights), the next best alternatives are tocarpool with friends or take mass transit.

You say you have no commuting pals ormass transit in your neighborhood? Don’tdismay. There are still steps you can taketoday for reducing fuel use that will helpyou save money and cut emissions.

TAKE IT EASY

Aggressive driving—braking quickly and accelerating quickly—can lower gas mileage by as much as 37 percent.

SLOW DOWN

By driving the speed limit you can savea bundle. Each mile per hour over thespeed limit results in increased fuelconsumption.

As a rule of thumb, you can assume thateach 5 mph you drive over 60 mph costsyou an additional 20 cents per gallon for gas.

LIGHTEN UP

Removing all extraneous “stuff” from yourtrunk and back seat will make your vehiclelighter, thereby maximizing fuel efficiency.

STOP IDLING

Idling is extremely wasteful. Turn off yourcar whenever possible to save fuel andreduce emissions.

TUNE IT UP

Keeping your vehicle on a regularmaintenance schedule will improve gasmileage. Be sure to inflate tires, changespark plugs and replace dirty air filters.

TAKE IT TO THE LIMIT

Buy a hybrid vehicle. These new cars usea combination of gasoline engines andelectric motors that reduce emissions andimprove mileage. Although mileage willvary by make, model and size, you canexpect as much as 60 mpg city/66 mpghighway for the top-mileage hybrid car.

You can compare the gas mileage of yourcurrent vehicle with a hybrid vehicle atwww.hybridcars.com/calculator.

Endnotes:

1. National Journal Policy Council

Sources and further information:

• www.Edmunds.com

• The Alternative Fuel Vehicle Institute(www.afvi.org/faq.html)

• www.Hybridcars.com

• www.fueleconomy.gov/feg/drivehabits.shtml

Tax Break for Hybrid Vehicles

The federal government provides a tax credit for individuals who purchase certainenergy-efficient vehicles. The tax credit applies to vehicles purchased or placed in serviceon or after January 1, 2006 and can range anywhere from $250 to $3,150 dependingupon the make and model. As of March 2007, more than 40 different models of hybridswere eligible for the credit. For more information visit www.IRS.gov and type "hybridvehicles" in the search engine.

Your Commute:Greener Commuting Can Stretch Your Fuel Dollar

Going Green to Protect the Planet (and Save Money)

If you are a small-business owner, you understand thattaking risks comes with the territory. For instance, youmay have left a secure, full-time job to start up your newendeavor. Or perhaps you’ve taken out a loan to fund yourbusiness start-up. These are common risks entrepreneursface when taking the leap from idea to reality.

There are times, however, when an owner needs to avoidcertain risks that could threaten a business. This is wherea good business insurance policy comes into play.Business insurance is a powerful and necessary tool thatcan protect your business from unforeseen situations thatmay arise. Even if you have a Limited Liability Company(LLC) or a corporation, business insurance is a must.While an owner’s personal assets are typically shieldedunder these structures, the business itself is not.

THE ABCs OF BUSINESS INSURANCE

A well-designed business insurance plan protects threethings: its people, its assets and its reputation. Acompetent business insurance agent who is familiar withyour industry can work with you to determine the areasin which your business is vulnerable. Your agent can alsomake sure you don’t over-insure for every possible risk.After all, your aim is to make a profit, not to go belly uppaying insurance premiums.

Property and liability are the two most common types ofcoverage for small business owners. However, other typesof insurance may be equally important or even requiredby the state or federal government. In addition, dependingupon the business you are in, you may need specializedprotection for specific types of risks.

PROPERTY INSURANCE

Business property insurance should cover the premises aswell as any assets, such as business equipment, machinery,furnishings, inventory, on-site personal property and the like.

There are many policies available with a myriad ofvariations. With a basic policy you can expect to becovered for losses that arise from fire, smoke, explosionsand vandalism. You can also get a broader form of


Business Insurance:Choosing a Plan Wisely


coverage that adds on damages due towater, broken windows and falling objects,for example.

Not all insurance plans are alike, so readthe policy carefully to make sure youunderstand what is (and isn’t) covered. If there is an item in which you areinterested, but you would rather not buythe entire package, chances are you canadd a rider to a basic policy for thatspecific coverage—such as on the loss of accounting records or cash—and save money.

LIABILITY INSURANCE

General liability insurance covers yourbusiness for damages or injuries that tookplace on your property or that werecaused by you or one of your employees.

There are three categories of liabilityinsurance:

• Personal Injury Liability: Covers yourbusiness if someone is injured on yourproperty and files suit.

• Product Liability: Protects your businessif a customer claims to be hurt by yourproduct.

• Auto Insurance: Legally required bymost every state, provides coverage fordamage caused by vehicles owned by abusiness. It can also cover “non-owned”vehicles such as employee automobilesused on the job.

REQUIRED AND SPECIALIZEDINSURANCE

There are other perils that may or may notbe covered under a broad liability or

property policy. If you are practicingmedicine or law, for example, generalliability will not provide the type ofprotection you need if someone claimsthat your business caused them harm.Knowing state and federal insurancerequirements is essential, as isunderstanding the risks associated withyour line of business.

Here are a few examples of insurance notcommonly provided under a broadliability or property policy, that may beessential for you to safely and/or legallyrun a sound business:

• Workers’ Compensation: Required bynearly every state, this insurance paysfor medical care as well as lost portionof wages for employees injured whileemployed.

• Theft Insurance: Covers you if youroffice equipment is stolen.

• Employment Practices Liability: Coversyou against employee civil or legalrights claims such as harassment,wrongful termination anddiscrimination.

• Business Interruption: Pays you if yourbusiness is forced to close for a periodof time due to events such as fire orearthquake.

• Key Man: Provides death benefits if afounder, owner or key employee who iscrucial to the operation of the businesspasses away.

• Intellectual Property: Providesprotection on trade secrets or patents.

• Professional Liability: Also known asErrors and Omissions (E&O) orMalpractice Insurance, protectsprofessionals (such as doctors, lawyers,accountants or any company thatconsults clients) against claims formistakes or omissions.

WHERE TO BEGIN

To find the right plan at the right pricewith the right components, you will needto shop around. If your needs are verysimple, you may want to start by checkingwith your trade association, professionalorganization or Chamber of Commerce,where you may be able to take advantageof group rates.

Another approach is to enlist the servicesof a competent insurance broker or agent,well versed in your industry who can puta plan together or find you a packagedpolicy exactly for your type of business.An experienced agent or broker will make sure that your business is neitherover-insured nor under-insured and willprovide you with concrete ways yourbusiness can be proactive in minimizingrisks which can save you headaches (andmoney) down the road.

Whatever route you decide to take, it’sgood practice to deal with a professionalyou know and trust who works with themost highly rated and well-respectedinsurance companies, so that you have the best protection possible.

Sources and further information:

• Small Business Start-Up Kit by Peri J. Pakroo J.D. ©2006 Nolo Press

• Insurance Information Institute (www.iii.org)

• The National Federation of Independent Business(www.nfib.com)

Under-insured?Over-insured?

Affinity Insurance Specialists can review your coverage to make sure you have the right insurance. Find out more atwww.affinityfcu.org or call 800-325-0808.


Ready to kick back and enjoy yourretirement years? There are many thingsyou will need to do to prepare for yournew lifestyle. Creating a dependableincome stream that you won’t outlive isone of them.

Social Security alone will unlikely beenough to support an active retirement.Unless you receive pension checks fromyour employer, you will need income foreveryday living since you will no longerhave employment earnings. Here are someguidelines to help you start off on theright foot.

PUT IT ALL TOGETHER

Your first step will be to take a good, hardlook at your income sources. You maywant to enlist the services of a competentfinancial advisor who has experience inthe areas of retirement and tax planningwho can:

• Review your Social Security benefits,IRAs, pension income, 401(k), stock

options as well as other savings,investments, assets and insurance

• Help you analyze and target yourretirement goals, income needs,tolerance for risk and intentions foryour heirs

• Take into consideration present andfuture tax issues

DESIGN A PLAN

When you begin withdrawing funds duringretirement, it’s important to keep yoursavings growing while minimizing taxesand preserving principal. You’ll need aninvestment plan to accomplish this task.An asset allocation mix that is adjustedregularly can produce income whileprotecting against inflation’s negative effectson your purchasing power.

1. Create a Portfolio

A diversified, well-managed portfolio ofinvestments can help you achieve the levelof income you will require for a

comfortable and secure future. A mix ofinvestments that meets your objectivesand risk profile, such as dividend-payingstocks, preferred stocks, municipal and/orcorporate bonds, certificate accounts,certain mutual funds, exchange-tradedfunds and the like are the ingredients of

New Pension Laws

Looking forward to receiving yourcompany pension in one lump sum?Take note: The Pension Protection Actof 2006 changed the calculations forfiguring out lump-sum payments fromdefined benefit plans. These changeswill likely reduce lump-sum payouts tomany workers nearing retirement age,but will not affect retirees who opt forthe monthly check option.

Before taking your retirement benefits,get a printout of the lump-sum paymentversus the monthly check payments tocalculate the difference.

Creating YourOwn PaycheckDuring Retirement


an income-generating portfolio. Regularreview and adjustment of your portfolio,accumulated savings and withdrawal rateswill help you stay on target.

2. Consider an Income Annuity

As a supplement to an investmentportfolio, you may want to considerconverting a portion of your existingsavings or investments to an incomeannuity. In exchange for a one-timeinvestment, the issuing insurancecompany will guarantee to pay you astream of payments for life.

There are two types of payment options:

• Fixed payments that do not changeregardless of market conditions

• Variable payments which fluctuate butoffer the potential for higher returns

Be aware that an annuity is a seriousfinancial commitment for life. Surrendercharges and other fees and expenses willapply, so read the prospectus carefully.

3. Delay Retirement

If outliving your assets is still a concern,another way to create income is to simplynot give up work entirely. A meaningfulpart-time job close to home can:

• Bring in much needed income

• Give your savings and investments moreyears to grow

• Delay withdrawals from IRAs and otherretirement vehicles

• Allow you to build a social network thatcan add a new dimension to your life

Source: Kiplinger’s May 2007 “Retirement Report”

Need to Adjust Your

Asset Allocation?

It’s never too late to talk to the retirement professionals at Affinity. Call 800-325-0808 today to find out how you cancreate a steady income stream during your retirement years.

InvestmentManagement Tip...

Withdraw more than you need foryour retirement living expensesduring years when your investmentshave made especially strong gains.Move those excess funds to a moneymarket account that provides easyaccess to your money when youneed to supplement your income.

You should always consider the investment objectives, risks, charges, expenses and tax consequences of any variableproduct or investment carefully before investing. Consult with a competent tax advisor before embarking on any retirementplanning strategy.



Waiting until the last minute to assess

your tax situation is a surefire path to

a larger tax bill from Uncle Sam. If

you are serious about minimizing

taxes, take action now to help reduce

next year’s tax bite.

THINK TAX DEFERRED

Max out your 401(k) plan for this year.This will lower your 2007 taxable incomewhile building your nest egg. If you areself-employed, fund a SEP-IRA (SimplifiedEmployee Pension IRA). TraditionalIndividual Retirement Accounts (IRAs)also provide tax-deferred growth, and mayeven be tax deductible, depending uponyour situation. (And don’t forget to takeadvantage of any make-up contributions,if you are age 50 or older.)

BE AWARE OF THRESHOLDS

Tax benefits from qualified tax-advantagedplans are often limited by your AdjustedGross Income (AGI). Contribution

amounts and deduction opportunitiesmay phase out and even disappear as youreach certain income thresholds. Keepingapprised of the current year’s thresholdscan help you plan better in order tooptimize tax-saving opportunities.

For instance:

• Taxpayers who are married and filingjointly cannot make Roth IRAcontributions if their modified AGI is $166,000 or more in 2007.

• For 2007, if you are covered by aretirement plan at work, your deductionfor contributions to a Traditional IRA isreduced (phased out) if your modifiedAdjusted Gross Income (AGI) is:

a) more than $83,000 but less than$103,000 for a married couple filinga joint return, or

b) more than $52,000 but less than$62,000 for a single individual orhead of household.

One-Time TaxDeduction for 2007Home Purchases

If you made less than a 20% downpayment on your new home this year,you may be entitled to a tax break onany Private Mortgage Insurance (PMI)premiums paid in 2007.

This one-time tax deduction is onlyavailable for qualified home purchases(i.e., generally those used as a primaryresidence of the taxpayer) that aremade in 2007 for homeowners whohave Adjusted Gross Incomes below$100,000 joint or $50,000 single.Taxpayers who earn more may take apartial deduction for incomes up to$110,000 joint or $55,000 single.

Source: Mortgage News Daily “An Update on PMITax Deductions” 5/30/07

Give Yourself a Tax Tune-Up

Save Money at Tax Time


Be Safe!Be Smart!

For More Tax Benefits, Open a Health Savings Account This Year!

Eligible individuals can reap significant tax benefits by establishing Health Savings Accounts (HSAs) for medical expenses. The primaryeligibility requirement is enrollment in a High Deductible Health Plan (HDHP).

HSAs offer these benefits:

• You can claim a tax deduction for contributions you, or someone other than your employer, make to your HSA even if you do notitemize your deductions on Form1040.

• Contributions to your HSA made by your employer (including contributions made through a cafeteria plan) may be excluded fromyour gross income.

• The contributions remain in your account from year to year until you use them.

• The interest or other earnings on the assets in the account are tax free.

• Distributions may be tax free if you pay qualified medical expenses.

• An HSA is “portable” so it stays with you if you change employers or leave the work force.

To learn more, talk to your Affinity Financial Advisor, or call 800-325-0808.

New This Year—Health Savings Account Funding Opportunity!

Beginning in 2007, if you are covered by a High Deductible Health Plan (HDHP), you may be able to make a nontaxable Health SavingsAccount (HSA) funding distribution from your IRA [other than a Simplified Employee Pension (SEP) or Simple IRA] that would otherwisebe included in income. For more information go to www.irs.gov/publications/p969/index.html.

HSAs offered by Affinity are insured by the NCUA.

Get a Head Start onThis Year’s Taxes!

The Affinity Tax Center can help you with your tax planning andpreparation needs. To get started visit www.affinityfcu.org orcall 800-325-0808.


MAKE CHARITABLE CONTRIBUTIONSTHIS YEAR

Make your charitable contributions beforeyear end so you can deduct them on your2007 return. Be sure to keep proof of ALLdonations no matter how small. The IRShas new record-keeping requirementsstipulating that you can no longer deductcash contributions unless you keep arecord such as a cancelled check, bankstatement or acknowledgement from thequalified charity. Additionally, if you havea large amount of income this year,

consider funding a charitable trust for an immediate tax benefit. Talk to yourfinancial advisor for details.

MONITOR RETIREMENT PLANDISTRIBUTIONS

Minimum distribution requirements on retirement plans kick in when you’reage 701⁄2 or older. Neglecting to takedistributions results in a hefty tax penaltyso make sure you’ve taken your requireddistribution for 2007 if you’ve reacheddistribution age.

REVIEW YOUR WITHHOLDING

If your lifestyle has changed or youreceived a large tax refund last year, modifyyour wage withholding so that taxes paidduring the year match those that you willowe. This way you won’t provide aninterest-free loan to the IRS. The IRS has ahandy withholding calculator on the web.Go to www.irs.gov and type “withholdingcalculator” in the search box.

For more information, visit the IRS websiteat www.irs.gov/individuals/index.html.

Source: www.IRS.gov


Fraudulent schemes of every variety areon the rise. Some are new while others areold-fashioned scams that have beengussied up and recycled in newfangledways to hook unsuspecting individuals.

Nearing the top of the Federal TradeCommission’s (FTC’s) complaint list thisyear are bogus lottery notifications, anupdated form of advance fee and check-cashing fraud that can lead to full-blownidentity theft.

IF YOU THINK IT SOUNDS TOOGOOD TO BE TRUE, YOU’RE RIGHT.

Fake lottery notifications come in manyshapes and sizes: internet, mail andtelephone. Operators of these scamsconvince individuals via email or regularmail that they have won a lottery inanother country. Sometimes they are sobrazen as to use the telephone to convince

consumers that they have “WON A LUMPSUM PAYOUT” in the tens or hundreds ofthousands of dollars.

What normally follows are a series of fake“red tape” type documents that looklegitimate. These documents requestpersonal information such as bank andcredit card information that the scammersuse to drain bank accounts or makecharges. Some of the schemes ask for anamount of money up front. Othersolicitations include real-looking checksthat victims are instructed to cash in orderto pay a “processing fee” to the fraudulentoperation. The winner turns into a loserafter the “processing fee” is paid and thecounterfeit check is discovered.

These solicitations are illegal. Often basedin Canada or another country, they violateU.S. law that prohibits the cross-border

sale or purchase of lottery tickets,according to the FTC.

WHAT SHOULD YOU DO?

The FTC suggests that you ignore all mail,email and phone solicitations for foreignlottery or sweepstakes promotions. Neverdisclose your personal information. If youreceive what looks like lottery materialfrom a foreign country, notify yourpostmaster.

If you’ve been victimized, call the AffinityMember Service Center at 800-325-0808,inform your state attorney general’s officeand contact the FTC at www.ftc.gov, or call toll-free 1-877-FTC-HELP (1-877-382- 4357); TTY: 1-866-653-4261.

Sources:

• www.FTC.gov

• San Francisco Chronicle, “Beware Canadian Lotto Scam,”12/15/06

Be Safe!Be Smart!

Keep apprised of the latest alerts. Please visit the Affinity web siteoften at www.affinityfcu.org/security.

Fraud Alert Update: Beware of Lottery Scams

?Didyou

know

You Can Manage Your Account at Over 1,700 Shared Branches!

We know that having a branch location close to you is important. That's why Affinity is part of an extensive network of credit union branches that let you conduct transactions face-to-face,just as if you were at an Affinity branch. With shared branching at over 1,700 Credit UnionService Centers, you can do more than just access your money; you can make deposits andpayments, transfer money between accounts—and much more. So whether you've moved, are traveling, or are just looking for a branch location closer to home, Affinity is there! Findlocations at www.affinityfcu.org/locator.


Affinity’s Beth Degnan Receives Accolades fromUnited Way

We are pleased to announce thatBeth Degnan, AVP, Office of theCEO and Affinity Federal CreditUnion Foundation Chairperson,has been awarded the SomersetCounty United Way 2007 AliceLull Corporate PhilanthropyAward for her hard work,dedication, and wonderfulcontributions as a communityvolunteer and activist. This prestigious award is bestowed uponsomeone from Somerset County’s business community whosebusiness has made significant financial and non-financialcontributions to benefit one or more non-profit agencies.

Beth was nominated for the Star Award by Julia Bey Ahmet,Director of Development at Community Hope, Inc. whichoperates the Hope for Veterans Program. Her tireless effortshelped to launch the Veterans Learning Institute, a newtraining program that focuses on financial education andpersonal growth skills to empower veterans’ successfultransition back into the community. Affinity employeevolunteers with specific skill sets in each particular subject

matter present monthly workshops at the Hope for Veteransfacility. In addition to the classroom setting, the veterans, aswell as the staff, have access to the Credit Union’s library andAffinity’s comprehensive training programs on topics rangingfrom computer and communication skills to personal growthand education.

Beth also received honorable mention for the Christian T.Nielson Unsung Hero Award, having been nominated byAndrea Krich, Executive Director of Making It Possible toEnd Homelessness (MIPH). Beth, with a select group ofAffinity volunteers, developed weekly financial literacy classespresented at MIPH’s Amandla Crossing transitional housingprogram. Amandla Crossing is a one-year transitionalhousing program for homeless mothers and their children.

According to the United Way, this is the first time one personwas nominated for awards by two separate agencies in oneyear. Beth and her team at Affinity are truly dedicated to theaid and development of the underserved and those in need,in order to help break the cycle of homelessness and despair.Congratulations to Beth for being rewarded and recognizedas a leader and for giving her time, talents, and resources toactively support our community and help make SomersetCounty a better place.

Community News

Announcing—Affinity’s Fall Inventory Clearance Sale! Saturday, September 29, 2007 from 9am to 3pm rain or shine,at AFCU Headquarters, 73 Mountain View Blvd., BaskingRidge, NJ. Members and non-members can shop for highquality, pre-owned vehicles at clearance prices.

Affinity has competitive loan rates. Get pre-approved beforethe sale and you’ll be eligible to attend an invitation-only, pre-sale event! For more information, call our Member ServiceCenter at 800-325-0808 or visit www.CUCarzone.com.

Coming Soon—Faster Check Processing at Affinity! Soon, we’ll be processing checks electronically. As a result,you will experience faster transaction times in our branches,an even higher level of privacy protection, and the checks youwrite will clear faster. To learn more, call 800-325-0808 or visitwww.affinityfcu.org/check21.

Go Green Sweepstakes: You could win a 2008 Toyota Prius Hybridwhen you use Online Bill Pay!

Save paper, time and money! Enjoy the ease and convenience ofOnline Bill Pay and you could win a 2008 Toyota Prius Hybrid.Earn an entry for enrolling in Online Bill Pay and an entry forevery bill you pay online between September 1 and September30, 2007. Learn more at www.affinityfcu.org/billpay.

1. No Purchase Necessary. 2. Qualifying online bill payments must be $10 or more invalue. Limit of one (1) payment per payee will be counted toward the sweepstakesentry period. 3. Sweepstakes begins September 1, 2007 and ends September 30, 2007.4. Sweepstakes open to legal US residents 18 years of age or older with a unique,personal and valid social security number. 5. To receive a free entry or to obtain fullofficial rules, please send a SASE to: Q3 2007 September Bill Pay Sweepstakes, P.O. Box1369, Manhasset NY, 11030-6369. Please refer to official rules for complete details.Void where prohibited by law.

A F F I N I T Y N E W S

A Little Touch of LoveAbsolute DanceAffinity ExpressAiki DesignsAJS Productions, LLCAmerican Legion Post 306Amscan, Inc.An Intense ImaginationArla FoodsASiMAstron ConsultingAutumn LeafBalance Financial GroupBC SolutionsB-Club, LLCButterfly Beauty SupplyC. Kelly Contracting, Inc.Circle R Electrical ContractorsCity of East OrangeClass A Investors, LLCClassic CutsCourt Crazy 4UCrea ArtsCurtiss-WrightDelois & Bell Enterprises, LLCDesign Your Time, LLCDirect Floor CareE D Nesmith & AssociatesEdison Landscaping ServicesEl TumiEvent Images Unlimited, LLCFab ProductionsFerrero USAGerg Realty Corp, LLCGomez CleaningHope’s What Not ShopJeff’s Surgical Supply, Inc.Jimenez Landscape ContractorsKey To Me Therapy, LLCLaddey, Clark, & Ryan, LLPLaris ConsultingLTG Ventures, Inc.Market Consumer Insights, LLCMcDragon Production, LLC

Mexican Boys Corp ServicesMidtown ToastmastersMKTINSITE, LLCMosiac PsychotherapyMount Calvary Missionary

Baptist ChurchMP American Home ConsultantsNew Jersey Community NETworkAATPANLS Associates, LLC.Norseman Co., IncOjome Oncology & Hematology SpecialistsPeninsula Commercial Holdings, LLCPinnacle Business SolutionsPrecision DesignPrestige Accounting & Tax ServicesQuantumquest Limited LiabilityRMG MortgageRoyce Brook Landscaping, LLCS&M Landscape Lighting, LLCScientific Strength Coaches, LLCScooby Properties, LLCSeamless TechnologiesSouthernmost Investments, LLCSpektrum Painting, LLCStracor Inc.Strazzulla HoldingsStrickland Business Group, LLCSugar Tops, LLCTaloolah Entertainment ServicesThe Longo PartnershipTriangle SchoolTrinity Innovative Enterprises, LLCU.S. Victory Veteran Systems, LLCUASOFT Inc.Valley OBGYN Associates, P.A.VE & Tou, LLCVirtually ManagedWade Hardwood FlooringWahs Realty Corp, LLCWaiters Unlimited, Inc.Westfield Police DepartmentWycoff TruckingYasmin, Inc.

Since the last edition of Affinity Connections, the following companies have joined the Affinity Federal Credit Union family as Select Employee Groups (SEGs). We’d like to thankyou for choosing Affinity. If you know of a business that wishes to take advantage of offeringthe benefit of Affinity membership to their associates, please have them call 800-325-0808.We’ll be happy to talk to them about the Affinity Federal Credit Union difference.

Thank you forchoosing Affinity

W E L C O M E



C O N TA C T U S O N L I N E O R B Y C A L L I N G O U R M E M B E R S E R V I C E C E N T E R :


Std. PresortPAIDPermit No. 225Warminster, PA






1520 Route 206 NorthBedminster, NJ 07921LobbyMonday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-6:00 Saturday, 9:00-1:00


235 Ridgedale Ave.Cedar Knolls, NJ 07927Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

Saint Clare’s Hospital25 Pocono RoadDenville, NJ 07834Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-4:30

Saint Clare’s Hospital400 W. Blackwell StreetDover, NJ 07801Monday-Wednesday, Friday,

8:30-4:00 Thursday, 8:30-4:30

315 Route 206 NorthHillsborough, NJ 08844Monday-Wednesday, Friday,



1098 Mt. Kemble Ave.Morristown, NJ 07960LobbyMonday-Thursday,

8:30-4:00Friday, 8:30-5:00Saturday, 9:00-1:00


A&P Shopping Center598 Central Ave.New Providence, NJ 07974Monday-Friday, 8:30-6:00Saturday, 9:00-1:00

15 East Midland Ave.Paramus, NJ 07652Monday-Wednesday, Friday,

8:30-4:00Thursday, 8:30-5:30

1342 Centennial Ave.Piscataway, NJ 08854LobbyMonday-Wednesday, Friday,





Not near one of thesebranches? You canalso access youraccounts via 50,000surcharge-free ATMs,1,700 shared branches,or through InternetHome Banking. Forinformation, visitwww.affinityfcu.org/locator.

We’ve become the 4th largest environmentaltesting lab in the U.S. by providing ourclients with outstanding personal service,an unmatched level of quality, a superiorknowledge of chemistry and consistent electronic delivery of analytical data.

We also offer complete access to LabLinksm—the industry’s most innovative and powerfuldata management service—only available toAccutest clients!

Add up the pluses and it becomes clear why more companies are relying onAccutest for their national environmental laboratory programs involving air,soil and water testing. Accutest, a lab you can count on, time after time.

For more information call us at 1.407.425.6700 or visit us online at www.accutest.com

Accutest Laboratories. It’s All in the Chemistry.

Orlando, FL 407.425.6700Dayton, NJ 732.329.0200

Marlborough, MA 508.481.6200Houston, TX 713.271.4700

Accutest!

IntegrityReliabilityQuality

Accredited by NELAC, USACE, NFESC

4405 Vineland Road, Orlando, FL 32811

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22 Gray, use of a second color, applied to squares,updates and gives logo more dimension Use of existing typeface and color maintains consistency with original logo

33 Squares tinted to differentiate areasFont change for laboratories - more substantial and connected with Accutest nameUse of existing typeface and color maintains consistency with original logo

44 New color for Accutest: deep blue green — cleaner feel, incorporates water and airUse of existing typeface maintains consistencywith original logo

55 Lighter version of existing font gives logo an updated look New color for Accutest: a deep rich green — environmental, growth

PMS 562 PMS 562

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Original

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2

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66 Replace use of gray with color-identify boxes suchas water (aqua blue), air (blue), soil or land/growth(existing green) Use of existing typeface and color maintains consistency with original logo

77 Burst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology Use of existing typeface and color maintains consistency with original logo

88 Lighter version of existing font gives logo an updated look Alternate Colors — water (aqua blue), land/growth(bright green), air (blue)

99 Lighter version of existing font gives logo an updated lookAlternate Colors — water (aqua blue), air (blue),land/growth (deep rich green) Burst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology

1100--1111Box icon is modernized by squaring one corner,solidifies logo. Accutest is a company that isexpanding into new areas — same company, new offers

1100 Color: blue is calming, strong and steadfastUse of existing typeface maintains consistencywith original logo

1111 Lighter version of existing font gives logo an updated lookBurst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology Colors: Light, lively green and a darker, deep richgreen — renewal/environmental, growth, better

ACCUTEST

PMS 7483PMS 7489PMS Cool Gray 10


PMS 7462PMS 562PMS 3135

PMS 7462PMS 7473PMS 3135

PMS 7462PMS 562PMS 3135

PMS 7462PMS 7473PMS 3135

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PMS 7462PMS 562PMS 3135

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PMS 7462PMS 562PMS 3135

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1122 Color: Light, lively green — renewal/environmental Use of original typeface maintains consistency withoriginal logo

1133 Lighter version of existing font gives logo an updated lookBurst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology Color: bold blue — solid, reliable

1144 Font change for Accutest: The updated font is data oriented with a scientific feel, molecular in appearanceThe use of lower-case suggests a young and forward-thinking company Burst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology

1155--1177Font change for Accutest: the use of lower-casesuggests a young and forward thinking company

1155 Color: darker a deep rich green — environmental,growth, newer, better

1166 Color: bright, clean blue — clean, crisp, lively, newBurst added to boxes gives more dimension whileconnecting the areas; it suggests power and theability to grow and expand in business, science and technology

1177 Replace use of gray with color-identify boxes aswater (aqua blue), air (blue), soil or land andgrowth (deep rich green)


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13

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1199 Color: Light, lively green — renewal/ environmental Use of original typeface maintains consistency with original logo

2200 Lighter version of existing font gives logo an updated lookColor: Light, lively green — renewal/environmental

2211 Icon and logo unite using same color Color: rich blue green — sophisticationLighter version of existing font gives logo an updated look

2222 The up-dated font is data oriented with a scientificfeel, molecular in appearanceThe use of lower-case suggests a young and forward thinking company Icon and logo unite using same colorColor: bold blue — solid, reliable

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Corporate2235 Route 130

Dayton, NJ 08810Phone: (732) 329-0200

Fax: (732) 329-3499

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562C 562U Cool gray 9C Cool gray 10U

7489C 7489U 7473C 7473U 2915C 2915U1215C 128U

7483C 7483U 3135C 3135U 7462C 301U7407C 1245U

4625C 4695U 7470C 7470U 5265C 2758U7416C 1665U

Mix

reliable, true, unity, integrity,refreshing, confident

Neutral

intelligent, strong, corporate

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effectiveness of remedial activities.

Warm

hope, support, rebirth

Mix

growth, renewal, youthful,forward moving (go)environmental

Mix

health, friendly, calming

Cool

peaceful, friendly, loyal

Warm/Nuetral

quality, valuable, positive, best of the best

Mix

life, nature, better, harmonyenvironmental

Mix

refreshing, lively, movement

Cool

unity, integrity, confidence,strong, stability

Warm

energetic, mentally stimulating,color of change

Warm/Neutral

down to earth, steadfast, honest, reliable, wholesome

Cool

balance, sophistication

Mix

intrigue, authority, imagination,inspiration

CCoolloorr PPaalleettttee

Air/Soil/Water — (Sun) Daylight

562C 562U

Cool gray 9C Cool gray 10U

7489C 7489U

Power/sun Soil/land/earth Water/ocean/lake/river Air/sky

7473C 7473U 2915C 2915U1215C 128U

7483C 7483U 3135C 3135U 7462C 301U7407C 1245U

4625C 4695U 7470C 7470U 5265C 2758U7416C 1665U