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                                                                       Money Mantras to Live By

Organization Is Half The Battle.
Mark all financial dates on your calendar. Download the LV Calendar and Seasonal To-Dos for reminders of
important dates, such as when to start preparing your taxes.

Your Income, Total Expenses, And Credit Score Are The Three
Most Important Numbers To Know.
Income: Be familiar with exactly how much you get from your paycheck each month (after taxes) so you can
budget appropriately.

Expenses: Things like rent/mortgage, cell phone, utilities, cable and groceries are your basic living expenses.
It’s important to know the total of these bills each month so that you always have enough to cover them.

Credit Score: This number measures your financial health, at least in creditors’ eyes, so it is essential to
know the number and always work to improve it.

                LearnVest recommends Credit Karma for checking your credit score. It’s not your official FICO
                score, but it is pretty spot on. It’s free, and easy to use.

Know Which Debts To Pay Down First And Then Commit To
Living Debt-Free.
It’s important to understand the difference between “good” debt and “bad” debt. Credit card debit is “bad” debt
and should be paid off as soon as possible.

               The rule of thumb is to always prioritize paying down debts with the highest interest rates.

Create An Emergency Savings Fund.
Set up an automated transfer from your checking account to your emergency savings fund for each paycheck.
Save as much as you can until you have 6-9 months of living expenses stored up. That money is out of sight,
out of mind, and you will be that much better off if an economic rainy day comes along.

               Don’t worry about investing until you have a cushion of savings that you can easily access.

Starting Saving For The Future NOW.
Saving for the future, especially for retirement, should be your next priority after your bad debt is paid off and
you have a cushion for an Emergency Fund.

               Ask your employer about your retirement options. A lot of companies are now offering Roth
               401(k)s. Find out if you have access to one.
Which Retirement Account Is Right For You?
                                      Does your employer
                                     provide a 401(k) plan?

                                       NO                YES

            Do you make more or less than      Does your employer match your
                   $105,000 a year                     contributions?

          MORE                     LESS                  NO                            YES

      Open a                Open a Roth             Do you make more or less                   Great! Enroll! Contribute as
   Traditional IRA           IRA today!!              than $105,000 a year                    much as possible to get the full
                                                                                               benefit from your employer.

                                            MORE                      LESS

          Contribute to your 401(k) regardless of the                  Open a Roth IRA. If you can save more
       non-matching. If you can save more than $16,500                 than $5000 a year for retirement, then
         a year for retirement, open a Traditional IRA                      also contribute to your 401k

                         Our unofficial sixth mantra is to understand where your money should go once your
                         living expenses and emergency savings fund are covered and established. Here’s
 an infographic that explains the accounts you need based on when you want access to the funds.

                              IF YOU NEED THAT MONEY...
  Now                    5 Years                   For                       5+ Years                  For
                         From Now                  Retirement                From Now                  Education
                         (think: next year’s                                 (think: Vespa, wedding,   (yours or a child’s)
                         vacation to Italy)                                   house, family)

                                         THEN YOU NEED…
  A savings account     High yield savings     A 401(k)                      Investment Account        A College Savings
  (or checking)         account or             (offered by                   at a brokerage firm       Plan (also called a
                                               employers)                                              529 plan) offered
                        Money market                                                                   by your state.
                        account or             An IRA
                                               (offered by all
                        Certificate of         brokerage accounts)
                        Deposit (CD)

  Make sure you dont    Go for whichever           These have tax            Have one in your          Whether you’re
  pay any fees          gives you a better         benefits! Anyone          name unless you’re        saving for grad
                        interest rate!             who has earned            married and saving        school or a child’s
                                                   income during             together.                 education, there are
                                                   the year can                                        perks to opening up
                                                   open an IRA.                                        a 529 plan.

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