A great way to organize your finances and pinpoint ways to save money.
YOUR SPENDING PLAN Creating and maintaining a livable, breathable spending plan is based on following 6 easy steps .
In addition to salary, think of all other expected sources of household income including tax refunds, bonuses, tips, etc. IDENTIFY YOUR INCOME
Be honest with yourself about all household expenses, including eating out, salon services, hobbies and habits. Include all of your regular monthly bills and payments to creditors. IDENTIFY YOUR EXPENSES
PAY YOURSELF FIRST Always put a few dollars aside in a savings account each month. Credit Counselors say the amount is not as important as establishing the savings habit! Money adds up!
MAKE ADJUSTMENTS Making expenses fit your income is not always easy. Consider consulting with a Certified Credit Counselor to structure a personalized spending plan that that focuses on your long-term goals.
DUMP THE DEBT Building a strong financial future means getting rid of your debt. Pay down highest interest rate credit card bills first. Hardship? A Debt Management Plan may be the solution.
TRACK YOUR RESULTS Check your spending plan monthly to monitor how much closer you are to reaching your financial goals! Balance your checkbook regularly!
SPENDING PLAN STRATEGIES:
D etermine wants vs. needs
E stablish short term and long term goals
S tay strong!
Do your own repairs and painting
Shop for the best insurance rates (homeowners, automobile, health)
Grow a vegetable or herb garden
Turn the thermostat up when not at home
Consider budget billing
Re-evaluate cable TV service
and internet costs
Pack lunches for school and work
Eat out less
Consider store brands
Shop buy one get ones
Do warehouse shopping
Limit shopping to once a week
Plan menus and shop with a list
Brew your own coffee
Car pool to school & work
Try public transportation
Ride a bike!
Keep your autos maintained for better gas mileage
Be a bargain gasoline hunter
Discover outdoor activities for the family
Rent DVDs for $1.00
Use restaurant coupons and join dining clubs
Take advantage of early bird offers at restaurants and movie theatres
ATM Fees Computerware Home Parties Cosmetics Online Services
Beauty Shop Over limit fees Dating
Ice Cream Parking Fees CD’s DVD’s Gifts Bottled Water Bounced Checks Clubs Cigarettes Greeting Cards Tanning Haircuts Cable TV Late Payment Fees Dinners Out
Bar Night Books Fast Food Attacks Dry Cleaning
Car Washes Lottery Tickets Magazines Movie Rentals Sports Lunches Out Gambling Prescriptions Household Items
Could this bill be negotiated for better terms until times get better?
CREDIT CARD DON’TS Don’t carry more than two cards with you Don’t use them for cash advances Don’t use them to pay for basics: rent, groceries, utilities. (unless you pay the bill in full each month) Don’t charge more than you can pay that month Don’t let others borrow your credit car d
CREDIT CARD DO’S
Use a debit card vs. a credit card
Use a card with no annual fee and low interest rates
Know all of your cards’ hidden fees
Always pay more than the minimum each month
Pay on time, all the time
THE REAL COST OF CREDIT…. What happens when you a $50 dinner? charge A $50 dinner over 20 years on a 22.8% APR credit card would end up costing $4,579.04. Paying only the minimum payment due could mean you never pay off your credit cards for your entire life. Finance Period 10.8 percent 16.8 percent 22.8 percent 1 Year $55.68 $59.08 $62.67 10 Years $146.53 $265.17 $478.49 20 Years $429.39 $1,406.31 $4,579.04
GOOD VS. BAD DEBT Good debt returns something of long term value - higher education or a home. Bad debt is “feel good” debt for purchases that you can’t afford and don’t really need. Any bad debt over 15% of your annual income after taxes should set off an alarm.
DEBT WARNING SIGNS
Being able to make only minimum
payments on credit card bills
Making late payments or skipping payments
Having credit cards at or near your credit limit
Arguing with family or friends over your spending habits or hiding purchases
Being unsure of how much you really owe
Using cash advances or payday loans to pay your bills
Having your credit card purchases declined
Having increasingly more of your income paying for debts
8 Tips for Staying Financially Healthy
Develop and stick to a spending plan that includes saving some money each month
Make a habit of paying off the majority of your credit card balances each month
Live within your means
Transfer any credit card debt to a lower interest rate credit card
Staying Financially Healthy (cont’d)
Plan ahead for large purchases
Teach children the “3 Ss”:
Saving, Spending, Sharing
NEVER turn unsecured debt into secured debt!
Consult with a Certified Credit Counselor for
advice and confidential assistance
If you need help creating a Spending Plan contact : 14051 NW 14 th Street Sunrise, FL 33323 www.americandebtcounseling.org (888) DEBT USA