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Your Financial Check-up

Your Financial Check-up. Lynn F. Little Extension Educator University of Maryland Extension Washington County . $$$ Smart Money Tip . CHART YOUR COURSE. Set S.M.A.R.T. Financial Goals!. S pecific M easurable A ction/Agreeable R ealistic T ime-Related.

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Your Financial Check-up

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  1. Your Financial Check-up
  2. Lynn F. LittleExtension EducatorUniversity of Maryland Extension Washington County
  3. $$$ Smart Money Tip CHART YOUR COURSE
  4. Set S.M.A.R.T. Financial Goals! Specific Measurable Action/Agreeable Realistic Time-Related
  5. Change these dreams to specific goals: Drive a car that is paid for By packing (not buying) lunch 2 days per week, I will pay an extra $50/month on my car payment so my car will be paid off by December 2009 Pay off my credit card balance and not make any new charges. I will play Bingo every other week and I will use the $40 to pay extra on my credit card balance so my balance will be zero by June 2010.
  6. $$$ Smart Money Tip ORGANIZE FINANCIAL RECORDS
  7. How long to keep records
  8. Identity Theft - Are you a target?
  9. $$$ Smart Money Tip KNOW HOW YOU ARE DOING
  10. Your Net Worth Assets - Liabilities = Net Worth
  11. www.americasaves.org
  12. $$$ Smart Money Tip BE A MONEY DETECTIVE
  13. Create a Spending Diary
  14. Does money slip through your fingers? Try to identify the leaks.
  15. Separate needs from wants
  16. Build A Budget/Spending Plan
  17. Important Reminder Use 70% of take-home pay for living expenses Use 20% to repay debt. Save 10% for you and your future.
  18. Track spending Review and Revise
  19. $$$ Smart Money Tip Watch Your Credit!
  20. Credit Bureaus 3 Major Credit Bureaus: Equifax Experian Transunion
  21. Collect data: Personal information Employment history Credit Use and Repayment history Provide information to: Creditors Employers Insurers Landlords What do Credit Bureaus do?
  22. Start Here
  23. What Makes Up Your Score? 10% New Credit 10% Types of Credit used 15% Length of Credit History 30 % Debt 35% Payment History
  24. Credit Score Ranges 720-850 – Moderate to Low Risk 620 - 719 – Fair to Good Risk 350 - 619– You may have difficulty
  25. www.myfico.com
  26. $$$ Smart Money Tip PAY OFF DEBT
  27. Minimum Payment Trap Credit card: Pay Minimum (4%) per Month: Balance of $3,000 $120/Month 19% interest 134 months to pay $1,872.43 = interest Total Paid: $4,872.43 Pay 5% of balance per month: $150/Month 103 months to pay $1,339.96 = interest Total Paid: $4,339.96 Difference: $532.47 Source: www.bankrate.com
  28. www.bankrate.com
  29. Signs of Credit Trouble Exceeding 20 percent rule Second salary used to pay debts Dishonest about credit use Credit not thought of as debt Use credit impulsively Use cash advances to pay bills Bills paid late Paying only the minimum due each month Defaulting on payments Anticipated income increase committed to credit Don’t know total amount of debt
  30. www.nfcc.org
  31. $$$ Smart Money Tip DEVELOP A SAVINGS HABIT
  32. Every Little Bit Counts
  33. Pay Yourself First
  34. Build an Emergency Fund 3-6 months net income
  35. An emergency fund will… Help you feel in-control financially Pad your bank account to help you avoid overdraft fees Make it possible to deal with the emergency quickly and get back to normal Help you avoid extra interest charges for unexpected repairs or emergency purchases
  36. $$$ Smart Money Tip Manage Risks
  37. Ask about available discounts Comparison shop – follow the rule of “3” Don’t try to save money by reducing or dropping necessary coverage Don’t select insurance company based on price alone Don’t surrender a whole-life policy for its cash value
  38. Consider disability income insurance Consider long term care Update beneficiary designations Keep up with changes in Medicare as you approach retirement
  39. $$$ Smart Money Tip INVEST WISELY
  40. SavingPreserve principal while getting a small return. InvestingIncrease principal in hopes of getting a greater rate of return.
  41. Do Your Own Ball Park E$timate For Retirement www.asec.org/ballpark/
  42. $$$ Smart Money Tip CREATE A PLAN FOR YOUR ESTATE
  43. Your Estate Plan A will or trust A guardianship/trust for minor children or disabled loved ones A power of attorney (general, financial, health care) Health Care Advanced Directives Personal Property Inventory with named recipients
  44. $$$ Smart Money Tip Make a TO DO list to help Manage Your Personal Finances!
  45. Lynn LittleExtension EducatorUniversity of Maryland Extension Washington County Office Your Financial Check-Up
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