SafeAmerica Credit Union

Fremont California

• By Kevin Alvarez

Coping with Inflation

Inflation continues to put pressure on household budgets. From groceries to gas, record-breaking inflation means the purchasing power of your money is decreasing each month. Below you will find guidance on how to best navigate a time with high inflation.

1. Take Inventory of your full financial picture. Has your household income changed? have you adjusted your budget for rising groceries, transportation, or other expenses? Check your existing budget to see where you stand and where your money is going. If you don't have a budget, it can help to create a simple spending plan or roadmap of monthly expenses. A good place to start is to use resources like a budgeting worksheet track your monthly income against current expenses.

2. Continue to build an emergency fund to tap into when unexpected circumstances arise like a medical expense or costly home repair. An emergency fund helps reduce the chance of taking on debt to cover an unplanned expense. It might be tempting to pause monthly savings as rising prices take a bigger bite out of your monthly budget, but resist the urge. Put savings on auto pilot with each paycheck. Even a small amount will add up over time.

3. Prioritize monthly spending in a time of rising prices. Rethink certain monthly expenses such as subscription or streaming services. According to researchers, the average household has 4.5 streaming services and spends an average of $55 on them per month. This may not seem like much, yet $55 a month adds up to more than $600 per year. If you’re trying to cut expenses in the face of higher prices, ditching underused subscriptions can be a good place to start. As essentials get more expensive, figure out your new baseline. Limit credit card use and curb discretionary spending (dining out, entertainment). GreenPath’s Aligning Priorities workbook can help you make these decisions.

4. Monitor debt, especially as interest rates rise. Paying off high-interest credit card debt saves you money in interest, improves your credit score, and frees up room in your budget. Choose a debt payoff strategy that works for your situation. Consider GreenPath’s Debt Management Plan which helps you pay off unsecured debt in 3 to 5years. GreenPath can work with many creditors to bring your ac-counts current, lower interest rates, and eliminate fees.

5. Shop smart. Research the best sales, coupons, and specials, especially on products that are low in inventory. Check dollar stores for deals on household items and stock up on those items where possible. Bulk retailers or wholesale clubs might be a good way to stock up on items in large quantities for a lower per-use cost. Strategically plan your higher-cost purchases. Swap out brand-name items for generic as much as possible.

6. Keep tabs on your credit history. In times of rising prices, it pays to keep tabs on credit history, which is used to calculate your credit scores. The three digit number of your credit score helps determine whether lenders approve you for new credit and what interest rates they offer. Annualcreditreport.com is a trusted “one-stop-shop” to check your reports from Experian, Equifax, and TransUnion – the three industry-standard credit bureaus. You can also work with GreenPath to review your credit history.

7. Get independent guidance from a nonprofit financial counseling agency like GreenPath. Counselors look at your entire financial picture to help you ease financial stress and uncertainty, through access to clear information and a personalized action plan.

Information brought to you by our partner, GreenPath Financial Wellness

GreenPath Financial Wellness

• By Kevin Alvarez

5 Ways to Make Money Resolutions That Stick

The New Year is a time for new beginnings. Are you ready to make money resolutions that stick?

Eliminating debt, learning new spending habits, or building savings are choices that can change your life. They can affect your entire well-being from stress levels, to physical and mental health.

When considered as one big New Year's goal, it can be overwhelming to know where to begin. To make it possible in the year ahead, here are five tips to commit to your financial health.

1. Make a Road Map: Set a Goal (and Write It Down)

Goal setting gives you direction. You can decide on your destination and make a plan to get there. This might seem small, but it's not. Not only is goal setting linked to higher achievement and self-confidence, but writing down your goal can also make you more likely to succeed.

2. Be Specific About What You Want, and Why You Want It

Getting clear on your priorities and deciding on a specific goal are two keys to success. When it comes to your money and your financial situation, set aside some time to reflect on what you really want to accomplish — and be specific.

Ask yourself three "W" questions:

  • What do you want to accomplish?
  • When will you achieve it?
  • Why does it matter to you?

Visualizing a dollar amount can lead to success, whether it is a specific figure to save, pay off, or earn in the year ahead. Keep that figure alive by writing it down or tracking it in an app.

A real dollar amount makes for a real goal. Give yourself a deadline while you're at it, to motivate you even further.

3. Be Positive and Realistic

Goals can challenge you and help you grow into a future. Choosing a goal that is attainable is another important part of success.

Let's say you have chosen a clear goal —with a positive outcome - such as: "In five years, I will be debt free. I will pay off my entire debt of $12,000 so that I can focus on enjoying my family instead of worrying about money."

Be sure it's a realistic goal based on your specific situation.

Given your income, debts and expenses is it realistic to spend $200 each month? Is it possible to pay it off even faster by spending $250 a month? Or does your budget allow for $100?

Staying positive and being realistic shows you how much you can devote to sticking to achieving your goal.

4. Keep and Celebrate Milestones

Making your goal measurable will help it stick. Keeping track of your progress can help you stay focused and motivated.

Tracking progress on an app, spreadsheet, or a simple notebook helps you see your future getting closer and closer.

Break your goal into smaller miletsones. This makes it easier to see your progress and is less intimidating.

For example, a mini resolution might pay off one credit card. Making smaller changes over time is often easier than trying to make a massive change all at once.

Celebrate your success along the way. Celebrating wins actually "trains your brain" by reinforcing your new habits, which makes it easuer to stay on track if you hit a bump in the road at some point.

5. Make (and Work) the Plan

Making resolutions often go by the wayside if they serve as a goal without a plan. A plan outlines how you will accomplish your goal.

Keep it simple. The plan might define how much you will spend toward your goal, how often you will make deposits on it, and the method you will use to transfer money toward your goal. For instance, automating monthly payments or savings goals is proven to help people stick with money resolutions,

Choose one habit to change at a time. For example, if you need to reduce your credit spending, focus is making that change as your first milestone. Then move on to setting money aside for payoff.

Ready to Make Money Resolutions That Stick?

A New Year is a new opportunity for success. There is good news — you do not have to go it alone! Our partners ar GreenPath Financial Wellness specialize in helping people get out of debt and improve financial wellness. Make those money resolutions stick by speaking with a financial expert. The call is free and confidential.

This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit.

 

Greenpath Financial Wellness

• By Kevin Alvarez

Get Your End-of-Year Financial Health Checkup

As the eagerly awaited holiday season gets underway, the end of the year is a great time to get a financial health checkup to make sure finances are on track.

With regular checkups, you can fix small problems before they become big issues.

This year-end keeping financially healthy is especially important due to many economic uncertainties related to inflation, inventory shortages, as well as the expiration of COVID relief programs put in place more than a year ago to help people manage through the pandemic.

Your Financial Health Checkup

Like a physical health checkup, a financial checkup examines your vital signs to be sure all is well when it comes to you financial health and wellness.

Do you have an emergency savings? How do your credit card balances look? Are you tracking monthly income and expenses? What does your credit score and history look like? These are a few of the vitals reviewed during an end-of-year financial checkup.

From an overall budget review to managing credit card debt, the caring, NFCC-certified counselors at GreenPath Financial Wellness will conduct a full review of your current financial fitness and provide recommended next steps for improving your financial health.

A financial checkup guides you to:

  1. Review Your Financial Goals: Has there been a significant life change this past year? A change in jobs, a marriage, divorce, home purchase or other big change can affect your overall financial picture. A check up is a good time to assess whether your current financial goals sync up with your overall situation.
  2. Understand Options to Move Forward after Relief Programs Expire: Loans that were deferred as part of COVID-related relief program need your attention. Deferments provided borrowers with a little breathing room, but now that the temporary pause in payments has expired, a checkup is a good opportunity to understand options, and take a closer look at not only any loans that were on pause, but also your entire financial picture.
  3. Manage Income and Expenses: One of the best ways to cope with inflation is to take the time to prioritize monthly spending. A spending plan helps to ensure that what you spend doesn't exceed what you make each month as prices rise. A financial checkup gives you a better understanding of your income and expenses. It can also be a time to set a spending plan to keep your finances on track and start saving for future goals.
  4. Pay Down Debt: A checkup is a good time to explore options to help you pay down credit card debt as well as options for managing other debts that may be on the horizon - such as expiring forbearances on mortgages or student loan payments.
  5. Assess Your Credit: Are you looking to take out a mortgage or make another large purchase in the New Year? A checkup is a great time to review your credi treport to see where you stand, and get tips to improve your score moving forward.

Your Checkup Starts Here

Your financial fitness is key to a healthy New Year. GreenPath's caring, certified counselors are committed to easing financial stress and worry through access to clear information.

For more information about financial wellness, visit our partner at GreenPath Financial Wellness.

Greenpath Financial Wellness