Getting in Control of My Money

1. Getting in Control of My Money Family Housing Advisory Services 2401 Lake Street Omaha, NE 68111 Julia Craig 934-6749 julia@fhasinc.org

2. Psychology of Money Views of Money • Where did we learn about money • Social and Family Values • Personal Empowerment How does money makes us feel? • Gives us a sense of freedom • Safety, Security, and Stability • Personal power, success and status • Social Status • Express love in personal relationships • Enhance friendships and family ties

3. WHERE DO YOU FIT IN? • Planners- control their financial affairs . They budget to save. • Strugglers- have trouble keeping their heads above rough financial waters. They find it difficult to budget to save. • Deniers- refuse to see that they’re in financial trouble. They don’t see a need to budget to save. • Impulsives- see immediate gratification. They spend today & let tomorrow take care of itself. They couldn’t care less about budgeting to save.

4. Money Basics • Money is alive and active through compounding and inflation. • You must manage it actively. • Money itself is neither good nor bad. • What we do with it and the “stuff” we accumulate is what others judge. • Money is an “equal opportunity” employee. Your age, sex, race, and religion are no factors. The variables are the amount you have, the amount you waste, and the time available for growth.

5. Money Basics • Money tends to be misused when spending is driven by emotions such as love, revenge, jealousy, comfort, and control. • Money makes you rich or poor based on your daily decisions as to how you use it. Slow and steady saving builds security and wealth.

6. Financial Mistakes • Poor debt management through excessive borrowing – not being able to live within your means. • Failure to monitor their financial position. • Lack of motivation (desire) to take action. • Lack of foresight in looking ahead. • Failure to set financial plans for the future. Most people don’t plan to fail, but fail to plan.

7. Financial Mistakes • Lack of knowledge. Financial ignorance can prove expensive. • Inadequate protection against unforeseen events (life and general insurance) such as death, disability and physical losses. • Procrastination in taking remedial action. • Most importantly, lack of discipline in saving habits. • Poor investments: you either pay too much tax on them or inflation eats into your return, or both…so that money actually goes backwards.

8. Financial Mistakes • Knowledge: financial knowledge is vital for all people to survive in the financial “jungle” that is today’s world. Gaining financial knowledge takes time, effort, and discipline. • You are the manager of your finances so make a plan to research your financial goals and then implement it. • ACTION is the key word!!!!

9. Financial “Rules of Thumb” • Always pay yourself first even if it’s only $5 to get into the “saving mode.” • Prioritize your spending; pay rent, utilities and basic needs before other bills. • Never spend all that you earn. • Plan before you purchase. • You can’t spend more than you earn indefinitely. • Change your attitude from spontaneous free spender to one who carefully considers many options before buying.

10. Financial “Rule Of Thumb” • SAVE for that “rainy day” because it ALWAYS comes! • Watch your quarters; the dollars take care of themselves. • Never charge anything that won’t last as long as the bill. • Distinguish WANTS vs. NEEDS. • Give up short term wants for long term goals. • Know your financial limitations. • Redo your spending plan to reflect life changes.

11. Steps To Wise Money Management • Set up goals as a Family • List all sources of Income • List all of your Assets • List all of your Debts • Open a Savings Account • Pull your Credit Report • Track your Daily Expenses • Create a Spending Plan • Save for Periodic Expenses • Reevaluate your Plan Often

12. Smart GoalsGoals are dreams with deadlines • Short- Term • Mid-Term • Long-Term • Specific • Measurable • Attainable • Relevant • Time-Related

13. WEALTH CREATION Assets – Liabilities = NET WORTH A wealth-creating Asset is a possession that generally increases in value or provides a return Liability, also called debt, is money you owe Net worth- is the difference between your assets and your liabilities

14. Develop a Budget and Live By It • FIXED EXPENSES • PERIODIC EXPENSES • FLEXIBLE EXPENSES • EXPENSE ENVELOPE SYSTEM

15. HOW DOES CREDIT AFFECT US CREDITWORTHINESS The 4 C’S of Credit • Capacity • Credit • Commitment • Collateral

16. WHO IS KEEPING SCORE • Equifax • 1-800 685-1111; www.equifax.com • Experian • 1-800-397-3742; www.experian.com • TransUnion • 1-800-888-4213; www.transunion.com www.annualcreditreport.com 1-877-322-8228

17. MY CREDIT SCORE Your credit score is based on the information in your credit report • 35% Payment history (is the aggregate of derogatory information) • 30% Amounts owed (balance should be 35% less then credit limit) • 15% Length of credit history (close new credit first, keep cards with long history) • 10% New credit • 10% Types of credit used

18. MY CREDIT SCORE

19. How to Establish a Good Credit History • Prepare A Spending Plan • Correct Inaccurate information on your Credit Report • Pay Your Bills On Time • Close Accounts Not Used • Reduce Credit Limits • Limit your Inquiries KNOW YOUR CREDIT REPORT

20. Avoid Scams • Debt Relief Offers • Advanced Loan Fee Scams • Guarantee Approved Credit • Credit Repair Scam

21. RESOURCE GUIDE • Federal Trade Commission 1-877-382-4357 www.ftc.gov • www.consumer.gov/idtheft 1-877-434338 • www.fraud.org 1-800-876-7060

22. RESOURCE GUIDE • American Saves (202) 387-6121 www.americansaves.org • National Endowment for Financial Education (303) 742-6333 www.nefe.org www.smartaboutmoney.org • National Foundation for Credit Counseling (800) 388-2227 www.nfcc.org