1. I have a checking account I use to deposit paychecks and pay bills. 2. I have enough money each month to pay my rent or mortgage payment and other household expenses. 3. I have a household budget and stick to it. ALLIANCE NORTHERN INDIANA 4. I save a set amount of money every month without fail. 5. I have enough money to pay for an emergency, such as a large car repair. 6. If I have any credit cards, I pay the total balance every month. 5-6: You are financially fit! Keep up the good work, and explore what else you can do to make and meet financial goals. Financial fitness is a top concern for every individual and every household. Being able to pay your bills, afford what you need and have a healthy lifestyle are goals everyone shares. How financially fit are you? Try this easy quiz and find out! 3-4: There are some key areas where you can flex your financial muscle more to become stronger and secure. 1-2: Your financial fitness could improve. The good news is there are a lot of small steps you can take and people available to help. HOW DID YOU DO? Count your Yes answers. If you scored: No matter how you scored, take a look at some financial fitness tips to decide what steps you want to take today to become more financially fit. Everyone can always grow stronger! CHECK YOUR FINANCIAL FITNESS
Transcript
1. I have a checking account I use to deposit paychecks and pay bills.
2. I have enough money each month to pay my rent or mortgage payment and other household expenses.
3. I have a household budget and stick to it.
A L L I A N C E
N O R T H E R N I N D I A N A
4. I save a set amount of money every month without fail.
5. I have enough money to pay for an emergency, such as a large car repair.
6. If I have any credit cards, I pay the total balance every month.
5-6: You are financially fit! Keep up the good work, and explore what else you can do to make and meet financial goals.
Financial fitness is a top concern for every individual and every household. Being able to pay your bills, afford what you need and have a healthy lifestyle are goals everyone shares. How financially fit are you? Try this easy quiz and find out!
3-4: There are some key areas where you can flex your financial muscle more to become stronger and secure.
1-2: Your financial fitness could improve. The good news is there are a lot of small steps you can take and people available to help.
HOW DID YOU DO? Count your Yes answers. If you scored:
No matter how you scored, take a look at some financial fitness tips to decide what steps you want to take today to become more financially fit. Everyone can always grow stronger!
CHECK YOUR FINANCIAL FITNESS
TOP 10 FINANCIAL FITNESS TIPS
TRY SETTING 3 FINANCIAL GOALS EACH YEAR. Make sure they’re realistic; Maybe, open a savings account, pay off a credit card or pay your bills on time.
1. Open a bank account and monitor your activity frequently.
Not having a bank account can cost you. Relying on products like payday loans, check cashing and pawn shops costs an individual on average $1,000/year in fees. A bank account also makes it easy to automate your savings. And it allows you to use a debit card instead of a credit card to help safeguard against overspending.
And, your money in the bank is secure, unlike cash stashed around the house that can be lost, stolen or destroyed in a natural disaster. Checking and savings accounts are insured by the Federal Deposit Insurance Corporation (FDIC).
Even if you have never had a bank account or have had difficulties keeping one in the past, Alliance bank members make it easier to open an account. Visit NIBOA.org to learn more.
Once you open your account, be sure to monitor all activity every month. It’s your job to be sure every transaction listed on your app or statement is accurate. But you’re not alone; we can help.
2. Focus on ‘needs’ instead of ‘wants’
In a world of heavy advertising, it can be hard to separate what you need from what you want. Yet this process is essential to healthy budgeting. Ask yourself about every expense: Do I need it or just want it? Even your grocery spending could be a combination of things you need and those you want. Ask the hard questions and you will be better able to budget and spend realistically. Once you’ve decided, stick with the needs and avoid impulse spending.
3. Eliminate unnecessary spending
While there are many things you could spend money on, some are more important than others. For example, saving comes first. Then you know you have to pay fixed expenses like your rent or mortgage. But with many other expenses, you can avoid unnecessary spending by being a savvy buyer.
For example, to avoid unnecessary spending on utilities, run the air conditioner less or keep it at a higher temperature setting. For car and gas expenses, consider carpooling. At the grocery store, try replacing convenience foods with basic ingredients, and avoid “empty calories” foods that don’t add to your nutrition, such as soda pop, chips and candy.
If you are buying fast food meals, try making or packing your own. If you are paying for cable TV, look for cheaper packages or services. If you are paying late fees on your bills, plan ahead to pay on time. It all adds up. If you save just $2 every day in unnecessary spending, that’s $730 a year!
4. Make a monthly budget and stick to it
Your budget is your game plan for how you will use your money. It helps you plan what you can afford so that you will have control of your money.
To make a budget, make two columns on a sheet of paper. The first column is income; the second column is expenses. In the first column, write down your net paycheck amounts, child support and any other income for a month. Total it. In the next column, write down all your monthly expenses, such as savings, rent or mortgage, utilities, food, gas, car insurance, childcare, health insurance and all others. Total this one. Now compare the numbers. Work with the expenses until they are at the same level as your income. This is your budget. Be sure to review every month to stay on track.
NOT HAVING A BANK ACCOUNT CAN COST YOU.Visit NIBOA.org to learn more.
5. Set aside cash for an emergency
Even with a budget, you can have financial surprises, such as car repairs or medical bills. This is why it’s important to build an emergency fund. Start wherever you can, even if it’s just $10 a month. That’s $120 a year! What’s important is that you save consistently. Even a small amount will build over time and boost your financial fitness.
6. Learn to pay yourself first
Once you have your emergency fund, the best way to save is to pay yourself first. Put a set amount of every paycheck into savings before you spend money on anything else. Talk to your bank or credit union about setting up a savings account and doing an automatic deposit from your paychecks.
7. Make financial goals
There’s an old saying: “If you don’t know where you’re going, any road will get you there.” Try setting three goals for the year. Make sure they’re realistic. Write them down and review them each month. Examples of goals could be: opening a savings account, paying off a credit card or paying all bills on time to avoid late fees.
8. Contribute to retirement savings
Did you know that according to the National Council on Aging, more than 25 million seniors in the U.S. are living at or below the poverty level?
Financial planners agree that Social Security and pension (if you have one) are not enough to make ends meet for most seniors. This is a good reason to start saving for retirement today. Check with your employer to see if you can save through a 401K or Individual Retirement Account (IRA) using payroll deductions. You can also start a retirement savings account on your own; just talk to your bank. Certain forms of accounts may even give you tax savings benefits now. No matter what your age is, starting NOW is the best way to protect yourself.
9. Avoid credit card debt if at all possible
Unless you pay off the complete balance every month, credit card purchases can cost more than you think. For example, if you spend $1,000 with a credit card that has a 25% interest rate and take three years to pay it off, the interest on your debt is $427. So you have really spent $1,427 on whatever you bought. If you have credit card debt now, make paying it off a financial priority. This will allow more freedom in your monthly budget to cover the things you need to cover.
10. Avoid payday loans
The Consumer Financial Protection Bureau calls payday loans a “debt trap”. This is because interest rates are very high and many find they can’t pay back the loans quickly enough. A payday loan can start a downward spiral on your finances. Take a careful look at your budget, stick to it and skip the loans. If you are having trouble paying a critical bill or have another financial emergency, contact 2-1-1.
HELP IS HERE!Do you need to open a bank account? Are you in crisis?
Or just ready to improve your financial fitness? Simple steps can make a big difference.
Here are some services available to you.
POWERED BY A COLLABORATION OF COMMUNITY PARTNERS IN ELKHART, LAKE,
LAPORTE, PORTER AND ST. JOSEPH COUNTIES.
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Northern Indiana Bank On Alliance This community alliance helps individuals and families begin the journey to financial stability. Check the Bank On website to learn more about help in opening checking and savings accounts, as well as practical financial fitness learning opportunities. Free workshops and online classes help you learn more about:
2-1-1 This community resource directory provides information on local nonprofit and government social services for those in need. It is the easiest way to connect to food services, housing assistance, employment services, counseling resources and more. If you are in need, dial 2-1-1.
Volunteer Income Tax Assistance (VITA) If you make $54,000 or less, you may qualify for free tax preparation services during tax season. IRS-certified volunteers provide free basic income tax return preparation to qualified individuals in local communities. Dial 2-1-1 for more information.
