Budgeting
101
Minding Your Finances
Balancing Your Life
10 Things Everyone Should
Know About Money
1. You have to earn more than you spend
Sure, short-term loans and credit card debt can
get you through a crunch period, but in the
long run, you need to bring in more than you
are shelling out. This means paying bills first and
prioritizing fun expenses. You can also save
quickly when brainstorming free fun activities vs
always having to spend.
10 Things Everyone Should
Know About Money
2. Saving early will help you save more
Start saving even a little every paycheck
long before you need it. Begin your savings
plan by setting aside what you may need
someday vs spending what you do not
have. This delayed gratification will always
leave you with more money and will help
you curb emotional spending.
10 Things Everyone Should
Know About Money
3. Balance high and low risk savings
Short-term savings, like bank accounts, give
the lowest return on your money but serve
as an emergency fund or for a down
payment. Higher risk savings, such as stocks,
give a stronger return over time. Stocks,
mutual funds and equities are for
retirement.
10 Things Everyone Should
Know About Money
4. Diversify for lower risk
If you diversify your savings between stocks,
mutual funds, index funds and IRS’s, you
prevent great losses when one sector is in a
down time.
10 Things Everyone Should
Know About Money
5. Protect yourself from identity theft
Identity theft is a rising problem in the
financial world. One way to protect yourself
is to monitor activity on your accounts.
Reviewing your monthly statements for
unrecognizable charges helps to quickly
alert your bank, who can easily replace
your cards.
10 Things Everyone Should
Know About Money
6. Invest in insurance for overwhelming
situations
Many people decide to underinsure only to
find themselves overwhelmed financially in
unforeseen tragedies. Take out policies for
homeowners, health, long-term care and
life insurance for important protection.
10 Things Everyone Should
Know About Money
7. Enroll in an automated savings program
It is amazing how quickly savings can build
when it is directed before we can see and
especially before we can spend it. Many
employers and banks make this type of
savings easy.
10 Things Everyone Should
Know About Money
8. Keep your debt as low as possible
Debt is not a bad thing when it helps you to get an
education or purchase a house or car. Making
regular payments on debt also contributes to a
higher credit score. Consider adding to your monthly
payment for the benefit of paying debt off early. It is
amazing how much can be saved when paying a
house or car off early. Then consider continuing the
monthly payment or even a portion of it into your
savings account since you were not using this money
anyway.
10 Things Everyone Should
Know About Money
9. Know your credit score
A credit score determines the interest you
are charged on a loan. Take advantage of
the free credit report at
annualcreditreport.com. You can then
manage and correct errors.
10 Things Everyone Should
Know About Money
10. There is always more to learn
Whether you are reading articles, consulting
your tax or financial advisor, embrace the
ever-changing world of finances by seeking
out the newest and most helpful
information. Continuously learning will make
a big difference in your financial health.
About That Budget
Since everyone is different, then one size
does not fit all for budgeting. So, we will
give two different examples of how to
create and stick to a budget plan. The
ultimate goal in budgeting is to be aware of
what you are spending, question what does
or does not need to be spent and as a
result, increase savings, right?
Structured Budget
The first example we will share is a structured
table of tracking expenses, income and savings.
This is worked out best over several months of
tracking and learning what is most consistent
and realistic.
See “Sample Budget Plan” in this same section.
Other ways of tracking are to download a free
app such as Mint.com or system such as “Meet
Every Dollar” at Daveramsey.com
Expense Tracking
The second example is a less structured tracking and
categorizing of expenses, income and savings. This is
also worked out best over several months of tracking
and learning what is really happening with your
money. It also helps you question spending as you
track in the first several months.
See “Sample Tracking Plan” in this same section.
You are also able to take advantage of many free
online tracking tools listed at
http:goodfinancialcents.com/best-free-onlinebudgeting-tools/
Making Your Budget Work
A budget can be like a diet with best laid
plans that are just that, laid aside or
dropped while real life goes on.
Being financially fit is the same as being
physically fit. It is a process that, if you stick
with it succeeds over time by constantly
getting back on track.
Making Your Budget Work
Ways to Stay on Track and Make Your
Budget Work!
1. Start with simple goals – Start with the first
small thing you want to accomplish, then
move on from there, step by step.
Making Your Budget Work
2. Question credit card use – Are you pulling
that card out too often? Is it best to keep it
out of your wallet? Is it better to keep a
debit or a credit card? Do you know the
balance at all times?
Making Your Budget Work
3. Develop Your cash advantage – Your
spending could be reduced or even
revolutionized when you draw from a
decreasing fund in your drawer or wallet.
Making Your Budget Work
4. Limit cash withdrawals – Try withdrawing
on a regular weekly or monthly basis to curb
your spending. It is amazing how mindful
you can become when the fun money is a
limited pool to draw from. Once again, you
can become amazingly creative when you
are excited by reduced debt and
increased savings! It is also a great things to
teach children and influence other adults
to live within or below your earnings.
Making Your Budget Work
5. Set aside time to review expenses –
Create an envelope at home for receipts
and review weekly or monthly. Also, review
your bank statement when you are paying
other bills as a check and balance system.
Making Your Budget Work
6. Look for that cash drain – When you
follow a regular system of reviewing
expenses, you will always be surprised by
where your cash is draining or leaking out of
your budget. This will create changes in
your spending as what you focus on your
reinforce.
Making Your Budget Work
7. Pay bills early – This may be tough, but will
help to avoid any late charges, which are
always a surprise hit on your income!
Making Your Budget Work
8. Avoid shopping as a past time – Eat
before shopping at grocery store to reduce
impulse purchases, take a list, or give
yourself the 24 hour rule of sleeping on it
before making bigger purchases.
Making Your Budget Work
Have fun – Think of your budget as a great
tool for freedom vs a restriction.
It will free up money over time and help you
reach your goals!
Ask for Help!
Employee Assistance is available to help
you with free financial advice and help with
a budget.
Give us a call Anytime!!
402-330-0960 – Omaha
1-800-922-7379 – National EAP Line