Creating A Spending Plan

1
Creating A Spending Plan

• Presented by Sponsored by
• Wendy Perkins, Credit Union of Ohio
• Financial Counselor

2
Tools for a Successful Plan

• A good spending plan is made up of several parts
• A strong organizational system
• Clearly defined priorities and goals
• Putting the information on paper
• An easy bill-payment system
• Monitoring and tracking your progress

3
Getting Started

• Why is planning so important?
• It allows you to make the most of every penny you
  earn
• Helps you to achieve your financial goals
• Why do budgets fail?
• They are too complicated
• They have unrealistic goals and objectives
• They are inconsistent

4
Getting Organized

• De-clutter. Take the time to get rid of
  unnecessary financial records.
• Gather all needed information including
• pay stubs, creditors statements, bank statements
  etc.
• Create a centralized place to organize and manage
  your finances.

5
Set Priorities and Goals

• Short term goals Goals that can be attained
  within 12 months.
• Long term goals - Goals that can be attained in
  3-5 years.
• Goal Setting Tips
• Specific
• Reasonable
• Measurable

6
Putting the Budget on Paper

• Convert all pay to a monthly figure
• Weekly pay x 4.33 Monthly Pay
• Bi-weekly pay x 2.167 Monthly Pay
• Should be based on consistent Net Pay - not gross
• Understand your pay stub
• What deductions do you have?
• Review your withholdings The IRS has a
  withholding calculator at www.irs.gov.

7
Expenses

• List all your monthly expenses
• Fixed, Flexible, Periodic and Misc
• Avoid underestimating your expenses
• It helps to track expenses for 4 weeks to ensure
  accuracy.
• Break down periodic expenses
• Put all expenses into a monthly cost

8
Debt Reduction

• Write down all debts including balance, interest
  rate and minimum payment.
• Determine how much extra you can afford to pay
  and pick one account to apply the extra amount.
• Prioritize your debts pay off credit cards
  first, then unsecured loans, car loans, student
  loans and lastly your mortgage.
• Try to pay at least the interest minimum
  payment

9
Building Savings

• Payroll deduction is key
• Start small and be consistent
• Ideal goal is to have 3 months of net pay saved
  for emergencies
• Look at various savings options to meet goals
• Savings and Holiday Clubs
• Money Markets and CDs
• IRA and 401K

10
Questions

• If you have questions or need help creating or
  maintaining your monthly spending plan, please
  call me at the Credit Union of Ohio at 487-6650
  ext 1729.
• Email wperkins_at_cccservices.com