May e-News

We are pleased to introduce the new “Star Photos” section of our website where you can receive free digital downloads of photos from local community events! Washington Trust sponsors community events and activities such as road races, concerts, and festivals throughout the year and our “shooting stars” are usually on hand to capture the fun! Take a look!

Watch your mailbox for important information regarding ATM and Debit Card overdraft coverage.

On those rare occasions when there are not enough funds in your account to use your ATM or debit card at the supermarket, gas station or favorite store, we may have approved the transaction as a courtesy to you, and advanced the funds needed to complete your purchase. However, due to recent changes in federal banking regulations, we can no longer cover overdrafts from ATM and debit card transactions unless we obtain your permission. Information regarding this new requirement will be mailed to debit cardholders in the next couple of weeks. Please watch your mailbox for this important information. If you would like more information now, please call our Account Information Center at 800-475-2265, or click here.

The Debit Card
Looks Like A Credit Card, Works Like A Check

Even though debit cards (or check cards) have become widely used, some people are unfamiliar with them. They look like credit cards or ATM cards, but function like cash or personal checks. When you use a debit card for a transaction, the money is automatically taken from the linked checking or savings account.

Debit cards can function in two ways - like an ATM card for immediate withdrawals of cash from an account or like a check when buying something. The money used to pay for the transaction is usually deducted from your account within a day or two, just like a check.

Advantages of a Debit Card

• Convenient. Unlike a check, when using a debit card for a purchase, personal identification is usually not needed.
• Safe. You don't have to carry cash or a checkbook.
• Readily accepted. Whether you're out of town or out of the country, debit cards are more widely accepted than an out of town check. Washington Trust's ATM Plus debit card is accepted worldwide wherever MasterCard is accepted.

Is a Debit Card Right For You?
If you want the convenience of a credit card but no monthly bills, our ATM Plus debit card is a great tool for managing your money. Purchase amounts are automatically deducted from your Washington Trust checking account and you can review all of your debit card transactions via online banking and in your monthly checking account statement. Unlike a credit card, money for debit card transactions is immediately or quickly deducted from your account. There is no grace period.

Some Guidelines

• Guard your debit card against loss or theft. Keep it in a safe place just like cash, credit cards or checks.
• If you lose your debit card, notify your financial institution immediately. You will also probably want to close your account and open a new one.
• Choose a PIN number that only you know. Don't use your phone number or birthday.
• Guard your PIN number. Memorize it and never write it on your card.
• Keep receipts from all your debit card transactions.
• Review your statements immediately and investigate any unknown transactions.

If you would like more information on Washington Trust's Debit Card please contact us.

Washington Trust Completes 10th PB Xpress Drive

The Bank's 10th peanut butter drive to benefit local food banks was completed on May 14th. This year's PB Xpress brought in more than 10 tons of peanut butter to help local families served by the Rhode Island Community Food Bank. In 10 years, Washington Trust has collected nearly 87 tons of peanut butter.

This year marked the 10-year anniversary of Washington Trust's PB Xpress -- a regional drive to collect nutritious peanut butter for the Rhode Island Community Food Bank. The 9 tons of peanut butter collected this year is timely-- given that hunger in Rhode Island has reached the highest level in a decade.

Thank you to the 150 schools, organizations and businesses across the state and region that held their own collection drives to contribute to the PB Xpress!

Joseph MarcAurele, Washington Trust Chairman, President and CEO with Michael Cerio, Communications Manager, RI Community Food Bank, at our April 24th PB Xpress Collection Day at our Governor Francis, Warwick branch. We collected more than 4,000 pounds of peanut butter at the event!

Financial Factoids...
Issues for Parents

Save Early for College Costs
The cost of attending college is high. Many private universities cost over $35,000 per year and even public universities can be over $15,000. Here is a chart showing the monthly savings needed starting when the future college student is at different ages:

Monthly Savings Needed

Starting when the child is:	Private University	Public University
Age 3	$1040	$446
Age 6	$1232	$528
Age 9	$1551	$665
Age 12	$2189	$939
Age 15	$4105	$1759

*Assumes an earning rate of 7%

Roth IRAs for Teens
Roth IRA contributions for a working teen can be the beginning of financial security. Contributions of up to $5,000 can grow tax deferred and distributions from a Roth IRA, after age 59 ½, are not taxed. A 16-year old making four contributions of $4,000 would have over $200,000 at age 65 assuming the funds earned 6%. Consult a tax advisor for complete details.

College Funding Options
For decades, parents have used custodial accounts to transfer funds to their minor children to help build assets for college costs. However, the 2001 tax law has enhanced the tax benefits of other types of asset ownership that should be considered. Coverdell Education Savings Accounts (Education IRAs) and Qualified Tuition Programs (Section 529 Plans) have become very attractive.

Funding College Costs with Custodial Accounts
With a custodial account, the parent creates an account on behalf of the minor child and transfers assets. The custodian, usually a parent, manages the account until the child reaches legal age. At that point, the child can do whatever he or she wishes with the assets. Transfers to these accounts are irrevocable. Income on the assets within a custodial account is subject to income tax.

Funding College Costs with Qualified Tuition (Section 529) Plans
Section 529 Plans are now offered by over 40 states. While the plans are offered by states, there are no restrictions on where the child attends college.

There are no income limits on the donors and contributions of up to $13,000 per year can be made. Earnings within the plan are not subject to taxes and withdrawals used for qualified educational expenses are not taxed.

Custodial Accounts for Children - Income Tax Implications
For 2010, the tax laws provide that the first $950 of investment income from assets held in the child's name is not taxed. The next $950 is taxed at the child's tax rate (usually the lowest rate of 10%). Investment income greater than $1,900 is taxed at the parent's rate until the child reaches age 18.

These tax rules are referred to as "The Kiddie Tax." Consult a tax advisor for complete details.

For more information on savings plans, please contact your local branch or click here to have us contact you.