peggy olive, family living agent richland county uw-extension how to save a dollar ….when you...
TRANSCRIPT
Peggy Olive, Family Living AgentRichland County UW-Extension
How to Save a Dollar
….when you don’t have a dime to
spare?
Why do you want to save money?
$ To pay bills & make ends meet
$ Save up for a large expense
$ Save for emergencies
$ Pay off debt
$ Other reasons
Spending Income
Do you think of saving as striking a balance?
Or is saving money or cutting back a burden?
Spending Income
If you want to save money, make
plans to spend it!
Ideas for Saving Money
$ Claim Tax Credits
Ideas for Saving Money
$ Put first things first
= Prioritize
Ideas for Saving Money
$ Have financial goals.
1 Year
3 Years
5 Years
Personal Financial Goals
What – When – How much?
What’s the Price Tag for Each Goal?
Goal
Date Needed
Amount Needed
Amount to Save Monthly
= New Car
=March 2013
= $3000
= $83
Ideas for Saving Money
$ Get (kind of) organized
Ideas for Saving Money
$ Look for the little leaks
“Small leaks can sink
big ships.”-- Ben Franklin
Ideas for Saving Money
$ Find fun things to do that
don’t cost (much) money (shopping,
TV)
Ideas for Saving Money
$ Don’t always buy in bulk.
Ideas for Saving Money
$ Buy it cheaper
$ Make it last longer
$ Use it less
Ideas for Saving Money
$ Look out for credit!
Making Minimum Payments on a Credit Card
Balance: $1000Annual Interest: 18%Minimum Payment: 3% or $30
Save Money by Using Less Credit
$1000.00Payment #1 -- 30.00
970.00
Interest + 14.55New Balance = 984.55
Payment #2 -- 29.54 New Balance = 955.01
Interest + 14.33New Balance = 969.34
Late Fee + $35 =
$1004.34Overlimit Fee + $35 =
$1039.34Interest Rate goes up to 33%
• It will take almost 8 years to pay off the $1000 original balance.
• The finance charge will be $684 not including any late fees or over-limit charges or increases in interest rate.
• The original $1000 now costs $1684.
• Pay Day Loans• Rent to Own• Car Title Loans• Pawn Shops
400-800%
40-700%• Rapid Tax Refund Anticipation Loans
Subprime Types of Credit
Catching up on credit payments:
$ Don’t take on any new debt
$ Use “PowerPay” strategy
“Power Pay” Concept• Pay your credit payments as usual.• When first loan is paid off . . .
. . . apply that payment to the next loan.
• When loan two is paid off . . .. . . add that payment to the next loan.
• Continue this process until all loans are paid off.
Utah State University Extensionwww.powerpay.org
Power Pay StrategyDoctor Discove
rMasterCar
d
April $35 $22 $35
May $35 $22 $35
June $0 $57 $35
July --- $57 $35
August --- $57 $35
September --- $0 $92
October $35 --- $57
…and so on $0 --- $92
Ideas for Saving Money
$ Look out for debit too!
…One more idea for
Saving Money
$ Track your spending.
How do you know how much money you’re saving if you don’t
know how much you’re spending?
Home Car
Groceries Utilities
Clothing Health Care
Emergencies Other Extras Hobbies Debts
Saving for longer-term goals
Where does my money go?
• Fixed Expenses• Flexible or
Variable Expenses
• Discretionary Expenses
“Must Do’s”
“Nice To’s”
Where does my money go?
Track Your Spending
Date Amount Spent
Description of What Was
Bought
3/1 $31.92 gas
3/1 $695.00 mortgage
3/4 $65.00 cell phone
3/7 $93.89 groceries
3/10 $27.12 gas
and so on….
$ Notebook
$ Receipts
$ Checkbook
$ Calendar
$ Envelope Method
$ Computer (free programs: mint.com or quizzle.com; Quicken or
Money; your bank?)
Ways to Track Spending:
Compare income and expenses once a
month.
IncomeSpending
CAUTION!You might be about to blow
your budget:
$ If you’ve had a bad day.
$ If it’s a really good deal.
$ If you have cash in your pocket.
$ If you have an unrealistic fantasy.
$ What’s your trigger?
When you can’t pay bills . . .
• Act now!• Financial Counseling