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"Don't Buy Stuff" Saving Strategies How is the economy today? Signs of Recovery DOW If you look at the 90-day rate it has been heading straight up — it has not receded. Local Economy High Electric Bills Decrease in Unemployment Rates December 2009 – 12.1\% March 2010 – 11.5\%

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Presentation Transcript
slide3
How

is the economy today?

local economy
Local Economy
  • High Electric Bills
  • Decrease in Unemployment Rates
    • December 2009 – 12.1%
    • March 2010 – 11.5%
    • Reasons for decrease could be hiring of seasonal workers or unemployment benefits ending
  • Beaufort County Medical Cuts 16 Positions, Explores Future
    • This decision comes after a difficult year for the medical center which even after drastic cuts lost 1 million dollars this year.
topics of discussion
Topics Of Discussion
  • Financial/Spending Plan
  • Budgeting
  • Money Management
establishing your financial plan
Establishing Your Financial Plan
  • Assess your current financial picture!
  • Define your financial goals!
  • Create and put your plan into action!
  • Evaluate your plan regularly!
assess your current financial picture
Assess your current financial picture!
  • Determine your net worth.
  • What is your cash flow?
  • Do you have an emergency fund and is it enough?
  • What is saved for retirement?
define your goals
Define Your Goals
  • Specific
    • Define your goal in detail.
  • Measurable
    • Assign a specific amount to your goal.
  • Attainable
    • Evaluate your goal to ensure that you can reach it.
  • Realistic
    • Review your goal to ensure it is achievable.
  • Time Bound
    • Allocate a time frame in which to achieve your goal.
create a plan
Create A Plan
  • Make yourself a priority list.
  • Make a plan that works for you.
  • Plan for your Future. Pay Yourself First!
  • Establish an Emergency Fund

Each time you are paid, set aside a portion of your check to deposit into a high interest savings account.

evaluate your goals
Evaluate Your Goals
  • Continuously monitor each goal to insure they reflect your current lifestyle. Over time your goals can change.
what is a budget
What Is A Budget?

A plan to manage your money for a specified period of time.

benefits of budgeting
Benefits Of Budgeting
  • Provides an organized way for you to save money for your goals.
  • Helps you determine where you may be spending too much money for things you may not need.
  • Helps you determine where you are spending your money.
  • Allows you to save for expensive items without the use of credit cards or loans.
  • Puts YOUin control of your financial future. Provides financial “FREEDOM”
cash flow
Cash Flow
  • Income
    • Any money you receive.
      • Examples: Paycheck, Child Support
  • Expenses
    • Any money you pay out.
      • Examples: Rent/Mortgage, Loan Payments, Gas
creating your budget
Creating Your Budget
  • Determine your Income
  • Calculate your Expenses
  • Analyze your Budget
step 1 determine your income
Step 1: Determine Your Income
  • What is your salary?
  • Do you currently have a 2nd job?
  • Do you receive any other forms of income? Alimony, Child support, Interest, Dividends…
step 2 determine your expenses
Step 2: Determine Your Expenses
  • Make a list of everything you pay for monthly.
  • This includes rent/mortgage, utilities, loan payments, credit card payments, savings account, gas, groceries, etc.
  • Categorize each expense as fixed, variable or periodic.
step 3 analyze your budget
Step 3: Analyze Your Budget
  • Compare your Income and Expenses to determine if they are equal. “Cash Flow”
  • If your Income and Expenses are not equal, ask yourself a series of questions:
    • Are there expenses that I can decrease?
    • Is another source of income necessary to sustain my lifestyle?
budgeting resources
Budgeting Resources
  • It is always a good practice to have your budget written down or on the computer to ensure you are following it.
  • There are a variety of resources available to assist you in creating your budget. Here are a few examples.
    • Money Management Planner
    • Microsoft Money
    • Quicken
    • An Excel Spreadsheet
    • A Budget Template (Using Microsoft Excel)
budget templates
Budget Templates
  • Personal budget worksheet
  • Family monthly budget planner
  • Personal Budget Planner for Bills
  • Bi-weekly Budget
  • Household monthly budget
  • Simple Personal Monthly Budget
  • Personal expense budget
example of a recent financial assessment
Example of a recent Financial Assessment

Family size of 4

Net household income of $4,542.

Fluctuating paychecks

90 days delinquent on their mortgage (Monthly Mortgage Payment of $1,350).

Several charge-offs & collections on their credit report.

monthly expenses
Monthly Expenses:

Dry Cleaning $240

Car Payments $952

Direct TV $115

Phone & Internet $350

Car Insurance $100

Vehicle Gas $260

Groceries $850

Progress Energy $215

Bricks Alarm $35

Misc. Expenses + $450

$3,317

Mortgage $1,350 + Monthly Exp. $3,567 = $4,917

Negative Monthly Cash Flow= -$375

3 ways to fix a negative cash flow
3 ways to fix a negative cash flow

1. Earn more money

2. Eliminate and/or cut back on expenses

3. Debt consolidation

1 earn more money
1. Earn More Money
  • Get a 2nd job.
  • Get family members to contribute by working.
  • Invest in the stock/bond market.
  • Obtain higher education to qualify for pay increases.
2 cut back on expenses
2. Cut back on expenses
  • Allow yourself to let go of your “wants”!
  • Take advantage of coupons and discounts.
  • Take advantage of employer benefits.

-Medical Reimbursement Plan (Health Care FSA)

-Dependent Care Reimbursement Plan

3 debt consolidation
3. Debt Consolidation
  • 1st thing…You need to qualify!
  • Find a lower rate and/or longer term.
    • Refinance your house
    • HOEQ loan
    • Use a car loan to payoff unsecured debt
  • Use pay down debt methods that work for you.
    • Attack the highest interest rate
    • Snowball Effect

“Don’t buy stuff you cannot afford.”

money management tips
Money Management Tips
  • Always PAY YOURSELF FIRST! Put at least 10% away for retirement.
  • Build an emergency fund equal to at least 3 months salary. If you do not currently have a savings account, visit your local financial institution to open one today! Sometimes it’s helpful to set up a draft so money is automatically transferred into your emergency fund.
money management tips39
Money Management Tips
  • Make sure your financial goals are outlined and manageable.
  • Pay more than the minimum on your credit card.
  • Each time you receive a pay increase, put that extra money in your retirement account, savings account or apply it to a debt.
money management tips40
Money Management Tips
  • Take advantage of banks/credit unions’ programs.

-Online Banking

-Online Calculators

-Financial Counseling

  • Speak with a financial counselor if you need help.
money management tips41
Money Management Tips
  • Before you go to the grocery store make a list. Remember if it is not on the list, don’t buy it!
  • Use coupons when shopping and discount cards if available.
  • If you prefer a soft drink or snacks bring your own from home rather than purchasing it from a vending machine.
money management tips42
Money Management Tips
  • Wash your clothes in cool water. About 80% of energy used in your washer is from heating the water!
  • Set your temperature in your home during the spring/summer to 76-78 degrees and in the fall/winter to 68-70 degrees. You can save 7-10% of your cooling/heating costs on your energy bill!

(Tips provided by NC GreenPower)

what if
What If…
  • You saved 15% of your paycheck each month for 1 year?
  • You purchased a soda every day for 1 year?
  • You went out to eat 3 times a week for 1 year?
results
Results
  • Assume you get paid $2,000 per month, you would save $3,600 (more than 1 month’s paycheck).

($2,000 x .15 = $300 a month)(12 months x $300 = $3,600!)

  • If a soda costs $.65, you would spend $237.25.

(365 days per year x .65 =$237.25)

  • If it costs $8 each time you eat out, you would spend $1,248.

(3 days x $8 = $24/week)(52 weeks x $24 = $1,248)

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