Learning to Save

1. Learning to Save

2. Take Charge and Reach Your Goals Learning to Save • PICPA –the Pennsylvania Institute of Certified Public Accountants • PICPA is a professional association of more than 19,000 CPAs working together to improve the profession and serve the public interest.

3. Take Charge and Reach Your Goals Learning to Save • Income: Money you earn or receive as a gift • It doesn’t matter how much you earn, it matters how much you spend • Calculate your monthly income and expenses. Use this to create a budget and stick to it. • Pay yourself first!

4. Take Charge and Reach Your Goals Want vs. Need • Pay for your “needs” first: • Shelter, food, transportation, utilities, emergency fund, saving and retirement funds • Buy “wants” with your leftover disposable income • Wait 48 hours before you purchase anything over $100

5. Take Charge and Reach Your Goals What are your goals? • Make a list of short-term and long-term goals. • Pick you top three and add a line item for each to your monthly budget. By spreading out the savings over time, it won’t seem so overwhelming. • Need a goal? Try buffing up (or creating) your emergency fund (at least 3-6 months worth of your income), your retirement fund, or start saving for a vacation or fun splurge as a reward.

6. Take Charge and Reach Your Goals Make your money work • Open a savings account • Invest in stock • Create a CD

7. Take Charge and Reach Your Goals Fiscal Priorities • Insurance Planning • Be sure you have life, health, disability, and long-term care insurance • Estate Planning • Everyone should have an estate plan. It includes more than just a will and durable power of attorney.

8. Take Charge and Reach Your Goals Fiscal priorities • Budgeting and Debt Management • Use extra income to pay these expenses off first • Retirement Planning • You can take out a loan for a lot of things, but retirement isn’t one of them. The longer you save for retirement, the better.

9. Take Charge and Reach Your Goals Fiscal priorities • College Planning • If you or your dependents are planning on going to college, be prepared to part with a lot of money. Look into 529 plans

10. Take Charge and Reach Your Goals Budget and Saving Analysis • Take a look at your budget and spending and saving habits. • What’s working and what’s not? • Make changes as needed • Where are you now, and where do you want to be tomorrow?

11. Take Charge and Reach Your Goals Tips • Prioritize and keep your eye on the prize: • Prize = reaching your goals for short and long-term savings, debt repayment, charitable and gifting • Determine “your” room for improvement

12. Take Charge and Reach Your Goals Tips • Start paying cash – you can reduce spending by up to 50% by doing so • Systemize your plan

13. Take Charge and Reach Your Goals Take Action • Determine the amount you’re allocating to savings goals and debt repayment goals • Set up automatic deductions from your paycheck into a savings account.

14. Take Charge and Reach Your Goals Take Action • Other things can not get in the way if the plan has been systemized • If we wait for what’s “left over” nothing will be there • Pay yourself (your goals) FIRST every month

15. Take Charge and Reach Your Goals Questions?