Budgeting by niusheng11


									"Don't Buy Stuff"
Saving Strategies
is the economy
       Signs of Recovery

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


Money Management
Establishing Your Financial Plan

1. Assess your current financial
2. Define your financial goals!
3. Create and put your plan into
4. Evaluate your plan regularly!
  Assess your current financial
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
   Define your goal in detail.

   Assign a specific amount to your goal.

   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
    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
         Create A Plan
Make yourself a priority list.
Make a plan that works for you.
Plan for your Future. Pay Yourself
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.
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
 Any money you receive.
   Examples: Paycheck, Child Support

 Any money you pay out.
   Examples: Rent/Mortgage, Loan Payments,
      Types Of Expenses
Types      Characteristics      Examples

 Fixed       Amounts do not     Car Payment
Variable    Amounts change      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

 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

If your Income and Expenses are not
 equal, ask yourself a series of
  Are there expenses that I can decrease?
  Is another source of income necessary to
   sustain my lifestyle?
  Budget Guidelines

 25%        15%     Debt


15%           35%
     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           $240
     Car Payments           $952
     Direct TV              $115
     Phone & Internet       $350
     Car Insurance          $100
     Vehicle Gas            $260
     Groceries              $850
     Progress Energy        $215
     Bricks Alarm            $35
     Misc. Expenses     +   $450

 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

3. Debt consolidation
       1. Earn More Money

Get a 2nd job.
Get family members to contribute by
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
Take advantage of coupons and
Take advantage of employer benefits.
 -Medical Reimbursement Plan (Health Care
 -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

 You went out to eat 3 times a week for 1
 Assume you get paid $2,000 per month, you
  would save $3,600 (more than 1 month’s
  ($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)

To top