"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%
 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
Financial/Spending Plan
Budgeting
Money Management
Financial/Spending
Plan
Establishing Your Financial Plan
1. Assess your current financial
picture!
2. Define your financial goals!
3. Create and put your plan into
action!
4. Evaluate your plan regularly!
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
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.
Define Your Time Frame
Goals
Length of Time
Example
Short-Term
Less than 3 months
Concert tickets.
Intermediate
3 months – 1 year
A down payment
on a new car.
Long-Term
Over 1 year
Save for early
retirement.
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
Continuously monitor each
goal to insure they reflect
your current lifestyle. Over
time your goals can change.
Budgeting
What Is A Budget?
A plan to manage your money
for a specified period of time.
How a budget can change on you!
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 YOU in control of your financial future.
Provides financial “FREEDOM”
Cash Flow
Income
Any money you receive.
Examples: Paycheck, Child Support
Expenses
Any money you pay out.
Examples: Rent/Mortgage, Loan Payments,
Gas
Types Of Expenses
Types
Characteristics
Examples
Fixed
Amounts do not
change
Car Payment
Variable
Amounts change
frequently
Grocery Bill
Periodic
Amounts vary can be Phone Charges
fixed or variable
Creating Your Budget
1.
Determine your Income
2.
Calculate your Expenses
3.
Analyze your Budget
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
 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
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?
Budget Guidelines
25%
15%
Debt
Housing
15%
35%
10%
Savings
Transportation
Other
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
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
Money Management
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:










Dry Cleaning
Car Payments
Direct TV
Phone & Internet
Car Insurance
Vehicle Gas
Groceries
Progress Energy
Bricks Alarm
Misc. Expenses
+
$240
$952
$115
$350
$100
$260
$850
$215
$35
$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
1. Earn more money
2. Eliminate and/or cut back on
expenses
3. Debt consolidation
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
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
 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
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 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 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 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 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…
 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
 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)
Questions?