What status symbols have you paid for?
It can be tempting to spend more than necessary to 'make an impression' or 'feel good'. As your credit union, we want to help you make informed decisions about status symbol purchases; whether it's a flashier car, more house than you need or an outfit with a pricy designer label attached to it.

Think about it. If you invested, or even saved that extra cash, what would it mean to your long-term financial stability and dreams?

Find more tips and ideas on smart money management in our newsletter and on our website!

Pay Yourself First
Jeff was frustrated. It was still two days until his next paycheck and he had nothing to show from the last one. Nothing.

"I need a better job," he grumbled. Beth, his co-worker, couldn't help overhearing him.

"I thought you liked it here," she commented.

"Well, sure," Jeff told her. "It's just that from one month to the next, I can't seem to put away any money for a rainy day, for my retirement, or even for a down payment on the RV I want. I think I need more money."

Beth put down the file she was holding and leaned on Jeff's desk. "Jeff, I don't want to ask you a personal question, so don't answer if you'd rather not, but what's the first thing you do with your paycheck?"

Jeff glared at her. "I pay my bills, of course. Isn't that the responsible thing to do?"

"Sure it is. And then what?"

"Well, you know. I pay for whatever I need."

"Did you ever try to take off part of your paycheck, say 10%, and put it into an account you can't touch?"

"Why would I want to do that? I don't have enough as it is." Beth smiled. "Try it. My parents pretty much insisted that I do it back when I was babysitting in high school, and that's what I've been doing ever since. You wouldn't believe how quickly the money adds up. Taking a bit off your paycheck is really giving yourself money before you give it to anyone else. It's what people call paying yourself first."

When you pay yourself first, you take a percentage off the top of your paycheck and deposit it into an account you don't touch.

Where’s the Money Going?
Q:
I know my spending is out of control, but I am not sure where the problems are. I mean, there is no money left at the end of the month and I have no idea where it went. Whatever you advise, please do not tell me to use a budget. I am just not that kind of person.
A:
Congratulations on reaching the point where you KNOW something has to change. This is truly something to be proud of. Many people realize their spending is out of control, but do nothing about it. Instead, they hope the problem will resolve itself. However, inheritances and lotteries aside, it never does.

As in every area in life, you need a solution that works for YOU. If you feel constrained by a budget, as many people do, there are other ways to get a handle on your money. But before you write off budgeting as something that would cramp your style, give it some honest thought. What IS the problem of a budget? If the tracking and paperwork seems too overwhelming, and you would like a system that is easier to maintain, I can understand that. But if you do not like the thought of having to make decisions on what you will and will not be able to purchase because there is not an infinite amount of money to work with, it is time for a reality check. Any system will do the same thing because the fact is this: everyone has only a limited amount of money to spend, whether that limit is $10 or $10,000.

Having said that, here are three alternatives for getting your finances under control:

1. Decide in advance how much you want to dedicate to savings, how much to charity, and how much goes toward your bills. When each paycheck arrives, put the designated savings amount directly into an account you can't touch. (Come into the credit union to discuss your saving options). [INCLUDE INFORMATION ABOUT PRODUCTS THAT FIT THIS CATEGORY HERE] Do the same for charity and bills. This is known as "paying yourself first." Provided you are not using credit cards, this system will keep you from spending the money you would rather be saving.

2. A second option is implementing a spending plan. No, this is not a budget by another name. A spending plan gets you organized, and lets you know how MUCH you have for each category of spending, not how little. Read up on spending plans in the library or on our website [POST ARTICLE TO YOUR WEBSITE ABOUT SPENDING PLANS, AND DIRECT MEMBERS TO YOUR SITE FOR FURTHER DETAILS]

3. If all else fails, work with cash. Designate a specific amount every month that is yours to spend any way you like. Put it into an envelope, and stick it in your purse. When it is gone, there is no more discretionary spending until next month. This is a last resort, but it always works.

The Richest Man in Babylon
By: George S. Clason
Short and to the point, The Richest Man in Babylon tells the story of several ancient Babylonians and their relationship to money in the richest society that ever was.

The story is completely fiction. That, however, does not detract from the lessons taught, which are things we already know, for the most part. But the book brings it all home in an interesting way.

At times a little confusing in its insistence on creating an ancient atmosphere, this is a quick read and a worthwhile one. For example, the story about getting out of debt describes someone who was in debt and gets out - simply use 20% of your income towards debt payment, 10% for savings, and live off 70%. Sounds simple, and of course it works, but how many people really do it? Read the book and you might be motivated to give it a try.

When a Parent Loses a Job
by: David Morris
In today's economy, people are losing jobs left and right. Initially, this doesn't really seem like it's going to impact us. I mean, we're safe, right? For anywhere from one to four years, we can ride it out in college and not have to worry about keeping our jobs. Right?

Unfortunately, that's not true. First of all, there is the issue of trying to find a job in a sunken economy, but that's another issue for another time. What I want to talk about today is what you do when your parent loses a job.

The first thing that's going to happen is a tightening of the belt. My mom recently lost her job, and while she wasn't really the wage earner, she was the fun-money earner. Since she lost her job, we've stopped planning on taking a vacation this summer and my parents have stopped living as large as they had been.

As a typical selfish (not to mention completely broke) college student, my first thought when my mom told me she had lost her job was "How is this going to affect me?" The first big change for me was the loss of 'extra' money. My parents give me a certain amount I can spend every month, and over that, I usually have to pay for things myself. But in the past, I've been able to ask them for things and they were willing to pay a little extra. For example, on my birthday I took all my friends out to an expensive dinner and my parents paid for it.

The next big thing to change was the tones of the conversations. They were no longer about the plans I had for this summer. They began to turn into lectures about saving money and needing to conserve my savings for a rainy day. At one point, it seemed like they would never stop. Eventually, I realized that many of their lectures were really just their own concerns about the family's finances, and as my mom started looking for a job, the stresses she had placed on me seemed to dissipate.

Basically, if one or more parents gets laid off, be prepared for some belt-tightening. It's unlikely that they will want you to get out of school, but if the situation becomes desperate enough, they may not have the money for tuition. If a parent does get laid off, it's a good idea to sit down with them and talk to them directly. Ask what is going to happen, how much the family has in savings, how long those savings will last, and most importantly, what you can do to help.

If You Don't Have a Discount Code, Look For One
Almost any time you buy something online, there is a place on the online form for you to insert a discount or promotion code. These codes are often included on coupons, special mailings or sometimes on the site you're visiting. If you don't happen to have such a code, look for one. It only takes a few minutes.

Open another window in your browser and type "discount code" into your favorite search engine, along with the name of the company from which you are making the purchase. Several Web sites collect that kind of information:

CouponWinner.com
CouponCabin.com
CurrentCodes.com
1stopmarketplace.com

These are just a few examples. Most times, you will find a code that entitles you to $5 or 5% or 10% off the regular price. All those discounts eventually add up.

Talk to Your Children About Today's Economy
Kids pick up on what's going on much more than we give them credit for. Have an open discussion with your children about what is going on in the economy, what it means to the United States, to the world, and to your family. Discuss worst case scenarios and invite them to share their fears, if they have any.

Keeping your kids in the know fosters an excellent, open environment and also lays the groundwork for possible times when you'll have to turn down their requests for goodies with the words "Sorry, we can't afford that right now."