Money, Money, Money!!!

Below are some financial tips that you should focus on during your current season of life.

1. Make a REAL decision to change – Without this step in the process, none of the following really matter. Aren’t you tired of going through the same financial stresses year after year after year after (…okay you get the message)?

2. Create a budget – To truly determine how much money you have, it is a requirement (not an option) to create a budget. A budget allows you to list your expenses, along with your income to get a true picture of how much disposable income you have. Disposable income is simply the amount of money not allocated towards paying a monthly expense. Most consumers rely on gross income in order to make budget assessments. However, most wage earners only take home a percentage of their gross salary (a $50K gross salary really only equals $35K after taxes and insurance deductions).

3. Find out where your credit stands – This is a logical step in today’s society where credit is a trillion dollar business. Credit scores are used to determine interest rates for automobiles, homes and credit cards. Credit scores are also used to determine insurance premiums and to assess eligibility for employment. You could be wasting thousands of dollars by not knowing, addressing and improving your credit scores. Companies profit significantly from consumers with low credit scores and desire for you to remain in bondage to them.

4. Use credit cards wisely – Unnecessary use of credit cards allow the average consumer to accumulate a considerable amount of debt, with no true way to repay the amount borrowed. If you don’t know how much credit debt you currently have, or have a plan in place to payoff your credit card debt, then it’s time to put your credit spending on hold. A financially savvy consumer always knows how much they owe along with a plan to payoff the outstanding balance.

5. Develop a financial plan – A comprehensive financial plan is key to preparing for the future. Many people in our society have no idea how much they need in order to retire comfortably. Even if you are currently upside-down in debt, it is essential to develop a financial plan for getting out of debt. You will then be able to focus on the future. Your financial plan should include:
a. Debt management – It is important to truly understand your outstanding liabilities and have a plan in place to eliminate debt.
b. Savings – Savings is a nest egg that you build to use in the event of emergency (job layoff, unplanned auto repairs, etc.). Your savings can also be used for planned family vacations or special occasions.
c. Retirement – Many people fail to plan for the time in their lives which is supposed to be happy. However, without a retirement plan in place, you can look forward to working a job until the later years of your life .
d. Insurance – Insurance protects your love ones in the event of your death. It’s sad to see the dissension that takes place between family members over the expense of burying a love one.