high quality louis vuitton replicas fake louis vuitton bags canada canada goose pas cher fake louis vuitton Replica Louis Vuitton Shoes louis vuitton outlet canada goose tilbud fack louis vuitton bags cheap goyard pas cher replica chanel shoes prada replica louis vuitton pas cher YSL replica Canada Goose Sale ysl replica replica louis vuitton bags gucci shoes replica bracelet cartier pas cher high quality louis vuitton replicas dior replica bags http://www.viamatic.fr/ louis vuitton replica uk Replica louis vuitton Belts uk fake cheap louis vuitton bags Replica Gucci Handbags Louis Vuitton Replica Handbags louis vuitton replica bags Canada Goose Pas Cher sac hermes pas cher fake cartier love ring hermes replica bags cheap louis vuitton Replica Prada Replica Bags hermes evelyne replica bolsos hermes replicas hermes replica replica gucci wallet fake louis vuitton bags replica Air Jordan 1 Retro gucci replica uk replica chanel shoes louis vuitton españa louis vuitton replica uk Louis Vuitton Replica Outlet sac louis vuitton pas cher chine louis vuitton china replica Replica Cartier Jewelry Replica Cartier Jewelry louis vuitton shoes replica uk Louis Vuitton Bags Outlet Australia replica van cleef & arpels jewelry replica cartier love bracelet uk sac louis vuitton solde louis vuitton pas cher Replica Cartier Love Bracelets gucci belt replica uk cheap louis vuitton replica Replica Cartier Jewelry australia gucci belt replica australia fake cartier love bracelet replica van cleef & arpels jewelry louis vuitton replica louis vuitton replica louis vuitton replica louis vuitton replica replica hermes handbags australia

ABOUT  |   MATERIALS  |   CEU  |   TEACHERS & COUNSELORS  |   BUILD A MONTHLY BUDGET  |   TEST YOUR KNOWLEDGE  |   MILITARY  |   FINANCIAL ARTICLES  |   CONTACT



What Are The Correct Savings Priorities?

5/5/2016

Many households are financially confused as to what they should do first, as far as paying down debts, how much they should investment, or what savings accounts they should have first.  

 Don’t allow yourself to get confused, or diverted from what your real financial focus should be. There are “experts” who try and convince people an “all or nothing” approach is best, living on “rice and beans” is the only way to attack your debts or save money. As many have found, this approach may put you into further financial difficulties. When doing an all or nothing debt payment program, you have now given all your financial resources, “Money” to creditors, do you believe if you lose your job, or your car has a major breakdown they will return “Their” money to help cover your financial setback. All or nothing to pay-off your debts or saving money is not a sound plan, taking a balanced approach works better. Implement a real plan, set“Goals” for savings, debts, entertainment and investing, by using a simple budget.

 Your word for the day is Balance! Balance may be your key to financial success, and for many their financial survival. Balance allows you to reduce your debts, manage your monthly expenses while building savings and budget for investing all at the same time. This way if you have a small financial set-back, hopefully you can recover quickly. Without balance it’s very easy to have one side of your financial equation covered while the other side falls into trouble, forcing you to take even further drastic measures and falling further out of balance.  

 The correct savings and investing account priorities:

1.      Emergency Savings Account: The goal for most W-2 employees should be six months gross pay in an FDIC savings account. Use a seven year goal to reach this balance, this is a balanced approach. There are FDIC higher interest no fee, no minimum savings account, these work great for an Emergency savings. For self-employed commission based, or seasonal jobs, set a goal to save one years income for an Emergency savings, use ten years to hit this goal. Do not touch this money, let it grow. Don’t stop when you hit your goal.

 Example: Gross monthly pay $3000 X 6 months = ($18,000 Goal) divide by seven years (84 months) equals $215 per month as an average, to reach your emergency savings goal of $215

 2.      Revolving Savings Account: Used for non-emergencies so you don’t touch your emergency savings. Learn this simple rule and you will find one of the best savings account you have ever developed.  Goal: A waterline balance (balance fluctuates) of 20% of your monthly gross income in a passbook savings account linked to your checking account. Example: Monthly Gross income of $3,000 so 20% of that is $600, goal. Budget $80 to $100 per month or as needed. Pad this account when possible, build it up prior to holidays and use as needed for non-emergencies, but don’t touch the Emergency Savings.

 3.      Retirement Investment Account: Only after savings accounts 1 and 2 are budgeted for, then put into your retirement. How much? As much as you can save while keeping with your plan. Do not put this account before 1, or 2. Never borrow or use your retirement for emergency money, unless there are no other options. You may pay dearly for this mistake if you do, in penalties and taxes.

 4.      College Savings: Accounts 1, 2, 3 should come before college savings have been budgeted for each month, only then should you contribute to a college savings.

 These are the top four categories for savings and investing. There are many sub-categories, you can decide how to prioritize them after these top four are in order.

 Oh sure, you can ignore this and do what the industry says, you can borrow money to pay for an emergency, but we all know how that usually ends, not well.

  

Sincerely,

 

Phillip Day, President

Academy of Financial Literacy, Inc






POST A COMMENT FOR THIS ARTICLE

* First Name:
* Last Name:
* E-mail Address:
* Comments
Security Image This Is CAPTCHA Image
Write the characters in the image above
* = required elements
Additional Articles:

2/13/2019:

1/22/2018: Income Insurance?

11/10/2016: Change Creates Profit Opportunities

10/5/2016: Your Wireless Plan, Does it Own You?

9/23/2016: The Legal Industry and A Questionable Practice!

8/25/2016: Seriously Folks!

8/18/2016: Looking for a Job, Create One!

8/17/2016: Is Your Handshake Your Word?

8/16/2016: The Two Income Trap

6/16/2016: Financial News, Who Can You Trust?

6/9/2016: Money Market Account? There is a Better Way

4/20/2016: Focus on Values, Goals, Sacrifices, Not Money!

4/4/2016: Investment Risk

3/3/2016: Life Insurance?

2/17/2016: Before You Sign on the Bottom Line

View All
About  |   Materials  |   CEU  |   Teachers & Counselors  |   Build a Monthly Budget  |   Test Your Knowledge  |   Military  |   Financial Articles  |   Contact
Copyright Academy of Financial Literacy, Inc 2012 - 2019