How I Learned About Saving For Retirement (And You Can Too)

coins and time clock retirement

Confession time: Finances have never been my specialty. As a creative professional, sometimes what I dream up and what happens in the real world need to come together for a little tête-à-tête. Now that we’ve gotten that on the table, you may ask, “So why are you writing about saving for retirement?” Fair question. Here’s why: in my quest to crack the “retirement savings code,” I resolved many previous unknowns (to me) and ultimately rethought my personal approach to saving for retirement.

 

I will also conjecture that there are a lot of people who are similarly lost when it comes to saving for retirement. In fact, the numbers support this hypothesis: according to an Economic Policy Institute (EPI) study“nearly half of families have no retirement savings at all.” With that in mind, here are some of the major questions that I had while digging into how I should be saving for retirement.

 

How much do I really need to have set aside to coast through retirement?

AKA, what is the magic number? A seemingly innocuous question, right? Not exactly. Turns out it depends on who you ask. This is where I learned there are many schools of thought on how to best approach your number. Below summarizes the three different methods I found, but you can learn more about each at 3 Ways to Calculate Your Retirement Number by money.usnews.com.

 

Income Method

This involves multiplying your income by a factor to determine how much you need to retire. There’s a little more to it than just that, and exactly how much you should multiply it by is debatable, but the article does a nice job of breaking down the different variables and assumptions you should account for.

 

Expense Method

This method asks you to analyze your monthly budget to arrive at your retirement number. You’ll need to think through what expenses you anticipate having then, what gets added, and what falls off, which brings up the subject of a mortgage… I’ll get into that a little later. There are, of course, a few other considerations which you can see in more detail here, but that’s the main idea.

 

Savings Method

This method involves setting aside a percentage of your annual salary in retirement accounts. This might be the most prevalent approach I encountered in my research; however, the “right percentage” to set aside can vary from source to source. My takeaway: 15% is a good goal on the conservative end and 20% on the aggressive end. Anything beyond that gets you gold-star status.

 

That’s a lot to digest. I get it. Luckily, I stumbled upon this article by CNBC with features a more digestible timeline of savings goals from Fidelity that follows the Income Method. And visuals are always helpful.

 

How much do I need to save for retirement?

10X

Fidelity Investments suggests you should aim to have 10 times your salary in savings.

Here is how much to set aside by age in order to stay on track for retirement at 67.

how-much-save-retirement-380x839

Keep in mind this is a ballpark diagram. Consult a financial advisor for exact numbers.

Epperson, Sharon. “What’s the Magic Number for Your Retirement Savings?” CNBC. 11 Feb. 2016. Accessed 8 Feb. 2018.

Where all will this money come from?

Here are the key players. Getting a general sense of each will help you understand how they all work together. This video from CNBC Money also does a nice job of explaining the differences.

 

401(k) – A 401(k) is an employer-sponsored type of retirement plan. It allows an employee to dedicate a percentage of their salary to a retirement account. Contributions are tax-free and taxes are paid upon withdrawal. Putting money into your 401(k) can be a great place to start, as many companies offer a match program up to a certain percentage. Ideally, you should strive to at least contribute up to the full match since that is free money for you!  Learn more about 401(k)s here.

 

IRA – An IRA is an Individual Retirement Account that can be opened up by anyone, whether they’re associated with an employer or not. There are two types of IRAs — a traditional and a Roth — which have a few differences, but the main one being the time at which you’re taxed. (Roth contributions are taxed the year you deposit them, traditional IRAs are taxed upon withdrawal.)

 

HSA – An HSA or Health Savings Account offers a way to set aside money for your healthcare expenses while receiving some tax advantages. Another nice thing is if you don’t use it all in a year, you can hang on to it and, in some cases, invest it!

 

Investments (other) – Whether it be in real estate, stocks, bonds, mutual funds, or any combination of these and more, this is anywhere you’re setting aside money in the eventual hope of reaping a return on top of your initial deposit.

 

Pension –  Employer-provided retirement income (from companies with pension plans) that requires an employee to work for them a certain number of years. The benefit usually increases with the length of time employed at the company. This often applies to government jobs, like military, police, and fire departments. According to The Balance, “Large corporate employers may also offer pension benefits, but it is not as common as it was thirty years ago.”

 

Social Security – It is hotly debated how much longer we should rely upon this as a source of retirement income. Regardless of its endurance, according to CNN Money, “your Social Security benefits will only replace about 40% of your previous income, which won’t cut it even under the most frugal circumstances.” So the best bet is to think beyond Social Security.

 

Do I count my home equity as income?

You’re right to realize that some of the expenses you have today won’t necessarily be around by retirement age. The amount you’re currently setting aside for retirement is one, ideally your student loans are another, and of course, that brings you to a major investment — your home (assuming it’s paid off).

 

But according to TheBalance, “you’ll also have retirement costs that you don’t carry today, like certain out-of-pocket health and end-of-life care costs. And ideally, you’ll also travel more, enjoy more hobbies, and indulge a bit. As a result, you may want to budget for retirement by assuming you’ll spend roughly the same amount you spend now.” The Huffington Post further supports this outlook in Is Your Home Equity Part of Your Retirement Savings?, saying that “If you don’t plan to sell, then your home equity, while still an important part of your overall net worth, shouldn’t be included in your retirement savings calculation.”

 

Should I focus on paying off debt or saving for retirement?

According to Dave Ramsey, it’s important to start with a firm foundation, and that includes addressing your debt first. In his post on The Truth About Retirement, Mr. Ramsey recommends that:

“You begin investing for retirement after you’ve done two things: you’re debt-free, and you have saved an emergency fund of three to six months of expenses. Three-fourths of the people on Forbes list of the 400 wealthiest people in America say getting and staying debt-free is the most important thing you can do when it comes to handling your money. The full emergency fund ensures you have a cushion in case of an illness or job loss and that your retirement funds stay where they are and keep growing.”

 

When is the best time to start saving for retirement?

The short answer: Now. Or as soon as possible. That’s because there’s also another factor in play that could really work to your advantage — compounding interest — or the interest you can earn on interest. According to Tony Robbins, “by not saving, and by not investing, you are losing out on more money by waiting than you stand to lose by taking a small risk and starting your retirement account.” For a more in-depth breakdown of how compounding interest over time can make a big difference, see Tony Robbins’s article: Create a Money Machine.

 

My final thoughts:

Although I’m no financial guru, I have wised up to a few things over time. First of all: processing your current age never feels any less like an alien/host-type situation; at 7 years old, the coveted teen years felt oh sooo far away, your 20s felt unimaginably grown up (hilarious), and every decade that passes thereafter… more of the same. Second: Seeking the “right time” is futile, because it doesn’t exist.

 

So when you factor in those “constants,” waiting to perfect a master retirement savings plan feels less critical (and daunting) than just getting the ball rolling in the right direction. That’s not to say you should become lax in your research and planning. By all means, get out there and speak to a certified financial advisor (they get paid to do this stuff for a reason). Just try to avoid getting stuck an endless loop of analysis and become your own enemy to progress. That’s not how you’ll make it to that little beach bungalow or another perfect retirement of your dreams.

Source: 

How I Learned About Saving for Retirement (And you can too)

Jaclyn Eickenhorst
Jaclyn Eickenhorst

 

By craft Jaclyn is a copywriter, but she really fashions herself more of an “idea explorateur.” When it comes to working through tasks to arrive at the best solution, she considers herself a purist, aka a compulsive brainstormer. Intervals of staring into space, broken up by a frenetic syncopation of keystrokes — that’s just part of “the process.” No need to call for someone…unless they have cookies. Definitely call then.

3 Questions for Jaclyn:

  1. Favorite hobbies?

    Paying guitar, boxing, finding new ridiculous things to worry about, daydreaming about the next great American novel, and talking to my cat like she’s a human baby (because she is).

  2. What was your very first job?

    A confectionary & culinary artist/customer service liaison within the food and hospitality industry — a.k.a. “counter girl” at Dairy Queen.

  3. Worst financial decision?

    Probably buying a timeshare at the ripe old age of 21. Not only was I gullible enough to attend the spiel, yes, I actually bought into it. Luckily, I read the fine print, found a loophole, and got out within 24 hours! Critical reading skills for the win!

Tax Code Changes 2019

TAXES 2019

The annual tax code changes can be confusing. No worries, though; we’ll walk you through everything you need to know for 2019.  

Though most changes won’t take effect until April 2019, some of them can impact the financial choices you’ll make this year. For that reason, here’s the details on the most important tax changes. 

1.)   Changes to the amounts taxed for each income bracket 

The 7 tax income brackets remain unchanged, but the amounts each bracket is taxed have gotten an overhaul. Here are the new rates for taxpayers filing as individuals. 

Taxable Income Bracket                Tax Due 

10%        $0-$9,700                         10% of taxable income

12%        $9,701 -$39,475               $970 +12% of income $9,700+

22%         $39,476 – $84,200          $4,543+22% of income $39,475+

24%         $84,201 – $160,725        $14,382.50+24% of income $84,200+             

32%         $160,726- $204,100        $32,748.50+32% of income $160,725+

35%         $204,101 – $510,300       $46,628.50+35% of income $204,100+

37%          $510,301+                       $153,798.50+37% of income $510,300+              

You can check out the taxable income rates for couples filing jointly and for individuals filing as heads of households here. 

2.)   Changes in standard deduction amounts

The standard deduction in 2019 will be $12,200 for individuals, $18,350 for heads of household, or $24,400 for married couples filing jointly and surviving spouses. 

3.)   Elimination of personal exemptions 

The personal exemption amount is being eliminated for the 2019 tax year.  

4.)   Changes to itemized deductions 

Some of the itemized deduction changes for 2019 include: 

  • Medical and dental expenses.  For 2019, you can only deduct those expenses exceeding 10% of your adjusted gross income (AGI).
  • State and local taxes (SALT). The new maximum for SALT deductions is a combined total of $10,000 for taxpayers filing jointly.
  • Home mortgage interest. In 2019, home interest payments will be maxed at $750,000 for married couples filing jointly.
  • Job expenses and miscellaneous. In 2019, you can only claim work-related deductions that are less than 2%of your AGI.

5.)   Changes to tax credits 

There have been several adjustments to various tax credits for 2019, including the following: 

  • Child Tax Credit. The child tax credit has increased to $2,000 per child.
  • Earned Income Tax Credit (EITC). The maximum EITC amount for 2019 is $6,557 for married taxpayers filing jointly who have three or more children.
  • Adoption Credit. The maximum adoption credit in 2019 for a child with special needs is $14,080. The ceiling for other adoptions is $13,810.
  • Lifetime Learning Credit. For 2019, the AGI used by joint filers to determine the reduction in the Lifetime Learning Credit is increasing to $116,000.

6.)   Retirement account contributions 

For 2019, you can contribute a total of $6,000 to one or more traditional or Roth IRA(s) if you’re under age 50, and $7,000 if you’re age 50+. For 401(k)s, you can contribute $19,000, and $25,000 if you’re age 50+. 

Your Turn: Which tax credit or deduction helps your finances most? Tell us all about it in the comments.

FREE Tax Prep Resources

SOURCES:

https://www.google.com/amp/s/www.forbes.com/sites/kellyphillipserb/2018/11/15/irs-announces-2019-tax-rates-standard-deduction-amounts-and-more/amp/

https://www.google.com/amp/s/www.marketwatch.com/amp/story/guid/18A0A5AE-E9DD-11E8-8F27-5C6847258365

https://www.google.com/amp/s/www.fool.com/amp/retirement/2018/12/23/the-6-best-tax-deductions-for-2019.aspx

https://www.google.com/amp/s/amp.usatoday.com/amp/2207406002

Impulse Purchases

impulse purchase cartoon

Aisha was walking home from school with her best friend, Katie. They chatted about the upcoming Science Fair and the new Phys. Ed. teacher as they shivered in the cold.  

They passed The Coffee House and watched as a bunch of their classmates walked out holding steaming cups of hot chocolate. 

“Hey Aisha. Hi Katie!” their classmates called. 

Aisha and Katie waved back. Aisha grabbed Katie’s arm. 

“Let’s stop here for a minute—they make the best hot chocolate and it’s freezing outside!” 

Katie shrugged. “I don’t want any.” 

“Oh, come on, Katie, you can get a cup with mini marshmallows and a drizzle of caramel—it’s awesome!” 

Katie shook her head. “I really don’t want any, but I’ll come in with you if you do.” 

Aisha pushed open the door, and a few minutes later, she was holding her own cup of chocolaty deliciousness. 

“I don’t know why you never spend your money,” Aisha told her friend before taking a long sip. “That’s what it’s there for, you know.” 

Katie just smiled and they walked the rest of the way home in silence. 

That evening, Aisha was looking through her wallet. 

“Mom!” she called. “My allowance is gone again—and it’s only Tuesday!” 

“You need to be more responsible, honey,” Aisha’s mom said. “Those seven dollars should be enough to last you all week! Are you ready to go?” 

Aisha snapped her wallet shut and ran to grab her coat. She was going with her mom to pick up a some groceries at Target. 

As they passed the front of the store, Aisha turned toward her mom. 

“Mom—look! They have your favorite coffee store right here inside of Target. Why don’t you pick up a latte or a cappuccino to drink while we shop?” 

Aisha’s mom turned toward her. 

“Because that’s not on my list,” she said, pointing at the paper in her hand. “It’s just an impulse purchase, and if I make too many of those, I won’t have enough money to buy the things we need.” 

“What do you mean?” Aisha asked as mom grabbed a cart and started wheeling it toward the grocery section. 

“There are some things I need to buy, and all sorts of things I want to buy just because they look good—like those,” Mom pointed toward a rack of candy bars near a register. “Impulse purchases taste good now, but I don’t really need them. And they cost a lot, too.” 

Mom patted her wallet. “I’d rather save my money for the stuff I really do need and keep those impulse purchases for special occasions that only happen once in a while. Doesn’t that make more sense?” 

Aisha nodded. It did make sense. And she was finally starting to understand why her allowance never lasted long enough. 

Tomorrow, she was going to be like Katie and skip the stop at The Coffee House on the way home from school. 

She also wanted to save her money for the things she really needed. 

Talking points: 

  • Can you give three examples of impulse purchases?
  • How can you keep yourself from making impulse purchases when you shop?
  • What are some impulse purchases that might be worth buying?

Impulse Purchases Worksheet

Impulse Purchases worksheet

Featured

New Year’s Resolutions You Can Actually Keep

Please enjoy this FREE E-Book from Mutual Credit Union as a gift to Kick Start your Successful Financial New Year in 2019! This workbook is designed to help you set goals, track them throughout 2019 and make your financial dreams a reality!

Click New Years Resolutions_eBook-interactive for the Downloadable Version. Enjoy!

New Years Resolution Workbook

 

WE Can’t Wait To SAY……………………………..

 

Congratulations on a Job Well Done

6 MISTAKES PEOPLE MAKE IN THEIR 20S AND HOW TO FIX THEM

Like many people, you may have blown through your 20s making financial decisions that served you well in the moment, but may not have been particularly responsible. 20s and 30s Dinner out several times a week, credit card bills you barely looked at and luxury cars way beyond your budget—life was practically a party!   

But now, the party’s over. You’ve woken up in your 30s and realized that all that overspending is going to cost you big—and it’s going to cost for years to come. 

Luckily, there’s hope. It’s not too late to fix the financial mistakes we all make when we’re young and blissfully ignorant. 

Here are six of the most common mistakes people make in their 20s and how to fix them: 

1.) The mistake: Racking up credit card debt 

Maybe you were broke while in college, but desperate for a good time, so you swiped your way through vacations and nights out on the town. Or maybe you knew you were falling into the debt trap to cover student-related needs on a shoestring budget. Unfortunately, it didn’t just go away like you’d hoped. 

The fix: Stop using your credit cards 

It’s time to be an adult and own up to your mistakes. Learn how to say no to impulsive purchases and to live within your means. Create a budget to help monitor and track your discretionary spending instead of mindlessly plowing through your paycheck each month. Stop swiping your credit cards and stick to debit or cash only. Don’t let those credit card bills get any higher! 

2.) The mistake: Ignoring your credit score 

Aside from being the gateway to endless spending, aggressive credit card balances have probably handicapped your credit score, making it difficult or impossible to obtain a personal loan. A poor score will also burden you with an unfavorable interest rate for the loans you do qualify for. And that means you’ll be paying off the mistakes of your 20s for years to come. 

The fix: Know your score and pay down your credit card debt 

It’s never too late to fix a credit score. Begin by monitoring your score. You can order a complimentary credit report once a year from each of the three major credit agencies at annualcreditreport.com. You can also check out your score on sites like CreditKarma.com and Bankrate.com. This will give you an idea of what you’re working with as you work on climbing out of financial hardship. 

Next, work on paying off credit card debt instead of only making the minimum payments each month. Look through your credit card bills and crunch some numbers until you know exactly how high your credit card debt really is. Then, choose one bill to pay down first and begin making the maximum payment your budget will allow. Once you’ve paid it off, divert all those funds onto the next bill until it’s gone and repeat until you have no more debt. Paying down your debt and minimizing the utilization rate on your credit cards will greatly improve your score. 

3.) The mistake: Skipping student loan bills

When you’re facing a debt in the tens of thousands of dollars while earning an entry-level salary, it’s tempting to just pretend it doesn’t exist. Unfortunately, though, that’s the worst thing you can do for your loan and your credit.

The fix: Work it into your budget

Call your lender to work out a more feasible payment plan. You can also check if you qualify for a student loan forgiveness program. Most importantly, make your student loan payments a part of your debt payment plan so you never miss a payment.

4.) The mistake: Neglecting your retirement

Planning for your decades-away retirement may be one of the last things on your list. However, starting to fund your retirement later in the game means missing out on years of compound interest gains.

The fix: Think of it as a fixed expense

Don’t think of retirement savings as an extra; think of it as a necessary, fixed expense that belongs in your budget like your rent and phone bill. Work with the most you can afford and max out your contributions to an IRA or your company’s 401(k) plan.

5.) The mistake: Not having an emergency fund

Life’s great—who needs to think about emergencies? Unfortunately, you do. Scrambling for funds to pay for a large medical expense or to live off of during an unexpected layoff can be a nightmare. Turning toward credit cards to help you get through a rough time can also be the beginning of a debt cycle whose effects are felt for years to come.

The fix: Start small

Experts recommend socking away 3-6 months’ worth of living expenses, but if that’s just not possible for you, start small. Work with whatever you can to make monthly contributions to an emergency fund. Set up an automatic monthly transfer so you never forget. It’s best to keep your emergency money in an account that offers an attractive earnings rate but allows you to withdraw funds without paying a penalty. [Credit union’s Flex Certificates and Savings Accounts are both good choices. Call, click or stop by to speak to a MSRP about setting yours up today.]

6.) The mistake: Not creating financial goals

It’s understandable not to have your entire life planned out yet, but it’s important to set some financial goals.

The fix: Create goals now

Take some time to set some financial goals. Do you want to buy a house within the next decade? Do you dream of opening a business? Are you hoping to retire at 55? Having a concrete goal in mind will help you stick to your budget and manage your money responsibly.

Messed up while in your 20s? It’s not too late to get your finances on track! Follow our tips for a financially sound future.

Your Turn: How did you fix the financial mistakes of your 20s? Let us know in the comments!

 

SOURCES:

https://money.usnews.com/money/blogs/my-money/articles/2018-10-25/how-to-recover-from-financial-mistakes-made-in-your-20s

https://www.thebalance.com/how-to-fix-money-mistakes-in-your-twenties-2385529

https://www.mybanktracker.com/news/fix-financial-mistakes

Making The Holidays Count

Don’t spend your holidays sleeping in until noon and letting the time slip through your fingers with nothing to show for it.college break with laptop

Check out our handy list of ways you can make the holidays count while still getting some of that much-needed rest and relaxation you’ve been craving all semester. You can still get your beauty rest and sleep in, only not until noon – well, at least not every day.

1. Apply for scholarships and internships

During the semester, you’re so bogged down with schoolwork and other obligations that finding the time to pursue scholarships and internships can be daunting. Put your looser holiday schedule to good use by getting a leg up on your applications. Devote one afternoon – or more if you can swing it – to researching and applying for those scholarships and internships. One great resource can be found at careeronestop.org –  Scholarship Finder. Sponsored by the U.S. Department of Labor, this search provides great tools to find those scholarships that match up with you best. Don’t Delay! Many deadlines are December 31, 2018 at midnight! 

2. Catch up with old friends

Don’t let your childhood friendships die because of neglect! Take the time this season to call up your old neighborhood pals and high school friends and have fun hanging out with those who know you best.

3. Plan next semester

Get a head start on planning next semester’s schedule by taking the time to do it now. You’ll be able to think more clearly when you’re not pressured and you can make your decisions at leisure. You might also want to give a thought to creating a daily, weekly and/or monthly study schedule to help you give school work your best shot.

4.   Workout

Don’t go back to school with that telltale holiday bulge! Fit a regular workout routine into your more relaxed vacation schedule and skip the binge-eating this season. You’ll look and feel a whole lot better! Many gyms offer a visitors plan or a trial price to try out their facility. This would be a great way to workout on a budget!

5.   Perfect your resume, cover letter and personal essays

It’s always a good idea to review, update and improve these documents every few months or so. Why not do it now? All it takes is an hour or two to make sure your resume, cover letter and personal essays show you in the best possible light. Be sure to tweak with any changes you’ve had in your work experience and education level and, of course, triple check for those pesky typos!

6.   Spend quality time with family

This might sound obvious, but don’t forget to spend some relaxed time just catching up with your family and creating new memories to take back with you to the dorm. It’s more than just sharing meals; give them your undivided attention, away from your phone.

7.   Volunteer

You might not have much opportunity to give back to the community during the semester, but when you’re on holiday break, why not offer your time and energy to a local cause? To partner with local agencies, consider contacting the United Way of West Central Mississippi at 601-636-1733 to match your time and skills with serving others. Volunteer to be a part of the Salvation Army’s Red Kettle Campaign or identify a need near to your home.

Your Turn: How do you make your holidays count? Share your best tips and techniques in the comments!

SOURCES:

https://www.fastweb.com/student-life/articles/the-10-things-you-should-do-over-holiday-break

https://www.usnews.com/education/blogs/the-college-experience/2011/11/23/holiday-survival-guide-for-college-students-and-parents

Do Your Kids Have Virtual Shopping Smarts?

Did you know that 73% of millennials questioned in a Bazaar Voice survey do all their Online shopping tips for youthshopping on their smartphones? It’s not surprising. The world of commerce is constantly becoming more digitized as retailers focus on improving their online presence to cater to cyberspace shoppers.

Online shopping has its downsides, though, mainly in the form of surprises when the item arrives, costly shipping expenses and impulse buys that are made too easily. Fortunately, it has its upsides, too.

Comparing prices between stores is a lot simpler when all it takes is clicking through a few sites instead of traipsing all over town. Couponing is now also just a matter of seconds, with no need for tedious clipping and saving.

Teach your kids to make the best of online shopping with this fun, educational activity. All you need is a computer!

Step One

First, sit down with your child to brief them on the ups and downs of online shopping. Talk about comparing prices, checking for discount codes and being wary of overspending or buying items of inferior quality. Teach them about reading reviews and looking for reputable companies. Mention comparison-shopping engines like Google, and others they may have never used, like Nextag, Price Grabber, Shopping.com and Shopzilla.

Step Two

When they have the information down pat, tell them they will now be tasked with buying an item online! The item should be something popular and one they’re interested in.

Step Three

Give your child a debit or credit card, a fixed budget for the item and the following instructions:

The goal is to purchase the lowest-priced, yet best-made product. This will earn a minimum of 100 points. They will earn points for each part of the process, using the following guidelines:

Guidelines

1. The purchase must be of decent quality. They can earn 25 points for this category.
2. Shipping costs should not constitute more than 10% of the object’s price. The lower the
shipping costs, the more they earn for this category, with free shipping earning the full 15 points.
3. They must search for discount codes and coupons before making the purchase. This
can be done by checking coupon sites like Retailmenot and Couponcabin, or by signing
up for a store’s emails and earning a promotional discount. 5 points will be rewarded for
every discount search/website visited in search of a coupon code. Actually finding and
using a discount can earn them 15 points.
4. If your child is ordering from eBay or another site with multiple sellers, they should be
careful to only make purchases from sellers with excellent ratings. Buying from a badly
rated seller can cost them 5 points and using a high-rated seller can earn them 5 points.
5. Price is of utmost importance. If their object is of decent quality and very well-priced,
they can earn up to 40 points. 5 points will be given for every search for a cheaper
product.
6. Points will be taken off for any random ad-clicks, failure to do substantial price-checks
and comparisons, and for ignoring discount offers.
7. Sit back and watch, being careful not to offer any advice as your child makes a
purchase.
8. Tally up the score and explain the points you gave, congratulating your child on their
online shopping skills.

Your child is now cyberspace-savvy!

Your Turn: Are there any online shopping tips or tools that you have shared with your child or just a tip you yourself follow when shopping online? Share in the comments.

Source: www.cucontent.com

 

How Should I Fund My Holiday Shopping?

Q: I’ve made my gift list and I’m checking it twice. But, I’m getting a bit panicky just thinking about how I’m going to pay for all this stuff! What’s the best way to get me through this expensive season?  friends_window_shopping

A: Relax! You can keep your budget and your sanity, too! You can do it without having to dip into your savings or rack up a high-interest credit card bill that you’ll be paying off well into 2019. Instead, learn about your choices so you can spend responsibly and keep your holiday cheer all through the season. 

Let’s explore your options and take a look at why they may or may not be right for you.   

1.) No-interest credit cards 

It’s never a good idea to rack up debt. However, if you can get your hands on a credit card that offers an initial no-interest period, you can borrow the money to fund those purchases without it costing you a penny in interest. 

Nice: This can be a perfect solution for you if you have an excellent credit score and concrete plans to pay back the bill before the zero interest period ends. 

Naughty: Don’t go this route if you have a poor track record of paying down your credit card bills. You might end up carrying that balance well after the intro period ends. You’ll then be hit with super-high interest rates that will make your holiday expenses go much higher. 

2.) Personal loans 

Anytime you need a pile of dough, you can stop by Mutual Credit Union to apply for a personal loan. Our representatives are always happy to help, and you can walk out with the money you need to fund your holiday shopping shortly after starting your application. 

Nice: Like all of our lending products, our personal loans have low interest rates, which makes the payback plan affordable for almost any budget. 

Naughty: If you’re already carrying a load of debt and unpaid loans, don’t take out another one just to get you through the holidays. Consider lower cost gift ideas and focus on paying off debt.  

3.) Skip-a-Payment 

Here at Mutual Credit Union, we understand that the holidays can be super expensive for our members. That’s why we offer you our own gift this time of year: the option to skip a monthly loan payment to give you that extra cash flow. It’s more breathing room in your budget, just when you need it most! 

Nice: When you choose Skip-a-Payment, you’ll be able to pay for those presents with the money your saving by skipping your December payment. No high-interest bills to haunt you through the first part of 2019 because you saved yourself from adding another payment to your credit card!  

Naughty: When you choose to skip a monthly loan payment, you are essentially moving that payment to the end of the loan’s life. Every Skip-a-Payment will make the loan’s term one month longer. Consider this: If you skip just one payment a year on an auto loan, the loan will be six months longer than you’d originally anticipated. 

4.) Christmas Club Account 

Don’t wait until Black Friday to start thinking about your holiday shopping. Pay a little bit toward this expensive season all year long by opening a Christmas Club Account. This way, when November rolls around, you’ll actually look forward to buying all those gifts instead of dreading it. Put the cheer back in your holiday season by opening a Christmas Club Account today! 

Nice: Christmas Club Accounts offer you a way to pay for your holiday shopping ahead of the season, instead of playing catch-up on your bills in the coming months. It’s the perfect way to take the stress out of the holidays! 

Naughty: If you want to open a Christmas Club Account to help you make it through this season, you’re a little late. But, it’s never too early to start thinking about next year! 

5.) Deferred-interest financing 

If you’re buying several large purchases at big-box stores, consider signing up for the retailers’ deferred-interest financing. Many chain stores offer customers this interest-free financing option so they can walk out with their purchase today, and pay for it tomorrow. 

Nice: Deferred-interest financing works just like an interest-free line of credit, only it’s exclusive to the store selling the item. If you don’t like the idea of opening another credit card but you need that interest-free option, this can be the perfect solution for you. 

Naughty: If you neglect to pay off your bill before the interest-free period expires, you’ll be slapped with sky-high interest fees. Worse yet, you’ll have to pay interest retroactively for the entire interest-free period. 

If you’re still struggling to get through the holiday season, we can help! Stop by Mutual Credit Union today. We’ll show you how to stay in the black when your holiday expenses have you seeing red. 

Your Turn: How do you pay for your holiday expenses? Share your method of choice and tell us why it works for you in the comments below.

 

SOURCES:

https://www.thebalance.com/pay-for-big-holiday-purchases-interest-free-4154866

https://www.wsj.com/articles/SB10001424052748704782304574541873369727460

https://www.google.com/amp/s/www.thestreet.com/amp/story/12808150/1/how-pay-your-holiday-shopping.html

Be More With Less

be-more-with-less

Look around your home, your room and your life. How much useless stuff is crammed into every available corner and taking up your valuable space, time and money? More importantly – is any of it actually making you happy? 

Courtney Carver believes that our obsessive drive to acquire more stuff complicates our lives on every level. And she is determined to change the world, one reader at a time. 

Courtney is the founder of Project 333, a minimalist wardrobe challenge that requires participants to choose just 33 items of clothing to wear exclusively for the next 3 months. You can read all about Project 333 hereSince launching her project in 2010, Courtney has been on a mission to spread awareness of her passion to readers around the world through her blog, at BeMoreWithLess.com. 

Be More With Less is all about simplifying your life to start living it to the fullest. To do so, you’ll embrace a minimalist approach when taking stock of your possessions and the way you spend your time. If you can’t honestly say that you need something, out it goes!

Courtney promises that joining her journey will help you rediscover the things that really matter. You’ll save money, have more space, create spare time and enrich each of your relationships by cutting down on the energy and resources spent acquiring and maintaining all your “stuff.”

As Courtney says, “Simplifying my life gave me the space, time and love to be more me.”

Be More With Less is updated several times a month with fresh content on a wide range of topics that all lead back to minimalism. You can check out the latest postings on the blog’s homepage or browse through the archives in any of the following categories: Clutter, Busy, Health, Money, Lifestyle, Work, Mini-missions, Project 333.

Some of the recent posts on the Be More With Less blog include: 

  • How to Quit Anything Without Feeling Like a Failure
  • Busy Boycott: Trading busyness for what you really want (+ live challenge)
  • Becoming Debt-Free: 21-day guide to help you get started
  • How to Let Go of 3 Fears that are Holding You Back Every Day
  • How to Simplify Your Life: gifts, downsizing, wardrobe, work and other good stuff
  • Journaling Prompts to Relieve Stress: 10 for Morning + 10 for Evening
  • 3 Little Lessons from Minimalist Fashion Challenge Project 333
  • 90 Days of Discipline: Why I’m Going All In and How You can Too
  • Choosing to Live with Less is a Privilege for Most of Us

Enrich your life by simplifying it. It’s that easy. 

Your Turn: Are you a fan of minimalism? Share your thoughts with us in the comments below.

 

SOURCES:

https://www.google.com/amp/s/experiencelife.com/article/be-more-with-less-qa-with-courtney-carver/amp/

https://bemorewithless.com/category/money/

https://bemorewithless.com

NEEDS VS. WANTS

father daughter discussion

When the lines between needs and wants are blurred, curbing our spending becomes an

impossible task. Teach your children this crucial tool and empower them for life. 

This month’s goal: Showing children how to identify needs and wants. 

Pointers to cover:
  • How to tell the difference between a need and a want.
  • How to prioritize between needs and wants.
  • When a want can turn into a need.
  • How to pay for wants that aren’t built into a monthly budget.

Conversation starters 

For kids under age 9:
  • What are some things you need in order to survive?
  • Can you list some things you wish you could have?
  • Is it more important to pay for the things we need or for the things we want?
  • How can we pay for some wants?
For kids over age 9:
  • Can you list all of your wants and needs?
  • When can a want become a need? Does it ever happen the other way?
  • Why is it important to allow ourselves to have some of our wants?
  • Do our needs change throughout our lives?
  • Do wants ever fade away?
  • Can you think of a plan that can help you buy something on your “want” list?

Your Turn: Are your kids experts at pinpointing their needs and wants? Share your conversation highlights with us in the comments!