Take a moment to complete the first sheet titled Where are you now

1
Where are you now?
Take a moment to complete the first sheet titled
Where are you now? Keep your responses in mind
as you proceed through the rest of this
presentation. Honest answers will help you plot a
realistic course towards financial freedom and
security.
2
Ask yourself if you

• Spend more than you make?
• Live beyond your means?
• Charge items rather than save for them?
• Dont have an emergency fund?
• Spend uncontrollably?

3
The many benefits of proper money management
include

• Less time fretting over money and more time doing
  what you enjoy
• Less worry about money may mean better health
• Greater control of your finances will give you
  peace of mind
• You will know the satisfaction of reaching your
  financial goals

4
Be SMART!
Now use your SMART Financial Goals Sheet to set
realistic goals

• Specific
• Measurable
• Adjustable
• Realistic
• Time Oriented

5
Be SMART!
The three terms of your goals should be

• Short Term (within the next six months)
• Intermediate Term (within the next one to five
  years)
• Long Term (more than five years away)

6
Be SMART!
You plan for each type of term by...

• Budgeting for short term goals
• Saving for intermediate goals
• Investing for long term goals

7
What is a budget?
A budget (or spending plan) is a blueprint for
your day to day personal finances. It helps you
to...

• Stay on track financially
• Determine where your money goes
• Make informed choices
• Develop a savings plan
• Control your financial future

8
Steps to a successful budget

• List all income sources
• Determine where your money is going (both fixed
  and variable expenses)
• Balance your income and expenses
• Review income and expenses then communicate a new
  spending plan with others in your household
• Manage your system

9
Income Sources
Income can come from a variety of
sources Paycheck BonusDividends GiftsIntere
st Child Support/AlimonyPension Earned
Income CreditSocial Security Tax RefundRental
Income Other
10
Expenses

• Expenses can be
• Fixed (mortgage, car payment)
• Flexible (food, clothes, utilities, gifts)
• Periodic (insurance, taxes)

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Expenses

• Expenses can also be
• Necessary (shelter, food, utilities, insurance,
  medical, debt payments)
• Discretionary (vacations, special clothes,
  entertaining)
• Personal (rough estimate only)
• Miscellaneous (unplanned dont use this as a
  catch-all category)

12
Track that spending!

• Track expenses with one of these methods
• Envelopes (Take receipts and place in designated
  envelopes by category)
• Checkbook Ledger (Keep a separate ledger for each
  expense type)
• Account Book (Same idea as the Checkbook Ledger
  method)
• Computer Program (Let a computer do the
  calculating for you. You just have to enter the
  correct numbers!)

13
Use the Where does your money go? worksheet to
track a few days worth of expenses. You will be
amazed at how quickly that daily cup of coffee
or other trivial expense adds up over time.
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Cash Flow Statement
Use the Cash Flow Statement to determine if you
have more money coming in than going out or if
you have too much month at the end of your
paycheck. If your income is greater than your
expenses, see if you can manage to save even
more. If your expenses are greater than your
income, you need to make some changes now!
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Cash Flow Statement Examples

• Money Coming In...
• Salary
• Gifts
• Interest/Dividends
• Alimony/Child Support
• Sale of Investments
• Capital Gains

• Money Going Out
• Recreation/Education
• Transportation
• Insurance
• Utilities
• Gifts/Donations
• Debt/Savings
• Housing/Clothing/Food

16
Review and Communicate
Now take some time analyze and revise your
spending/saving plan if you have one in place. If
you dont have a spending/saving plan develop one
now. Using your Cash Flow Statement as a guide,
develop a plan to implement the changes necessary
to achieve your SMART Financial Goals. Small
adjustments can pay off big over time (remember
the Where does your money go? worksheet?) Make
sure you communicate your goals, plans and
changes with everyone in your household, no
matter how young or old they are. Everyone plays
a role in spending and saving.
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Beware of Pitfalls
Common pitfalls that can ruin your spending plan

• Medical Emergencies
• Holidays/Vacations
• Repair bills/Auto accident
• Parking tickets
• Late fees
• Unread subscriptions

• Ignored repairs
• Impulse shopping
• Eating out frequently
• Unused phone services
• Leftover food
• Overuse of utilities

An Emergency Fund is vital to surviving these
pitfalls
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Money saving tips
Use these money saving tips for long-term
benefits

• Pay down debt
• Bundle insurance with one company
• Shop around for insurance and credit
• Use credit cards wisely
• Pay in full each month
• Pay on time

• Use coupons/send in rebates
• Take your lunch to work
• Drive sensibly
• Use programmable thermostats
• Make saving a habit
• Use payroll deduction
• Setup automatic withdrawals
• Use holiday club accounts
• Save one years raise

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Contact Us!
Contact ITT Employees Federal Credit Union to
see how we can help you save for the future. We
offer many products for saving including club
accounts, IRAs, and share certificates. We also
offer loans for debt consolidation and/or rate
reduction. Our Bill Pay product can help you
manage your bills so that you can pay them on
time. Direct deposit and payroll deductions allow
you to make saving and loan payments
automatically!