VCU HUMS 202 - HUMS 202 Module 4 (3 pages)

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HUMS 202 Module 4



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HUMS 202 Module 4

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Pages:
3
School:
Virginia Commonwealth University
Course:
Hums 202 - Choices in Consumer Society
Choices in Consumer Society Documents
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HUMS 202 Module 4 Money Matters Set Financial Goals Financial Goals o Specific to what you want to do with your money within a certain time period Do the following o Identify and write down your financial goals Examples Savings for college Buying a car Making a down payment Taking a trip Building an emergency savings fund Retiring Goals should be realistic and specific They should include a time frame to when you wish to accomplish this goal Don t forget to include the actions you take to work toward this goal o Organize your financial goals Break you goals into several goals Short term less than a year Medium term 1 3 years Long term 5 or more years o Identify small steps for working towards these goals o Monitor your progress Review your progress Monthly Quarterly At least every 6 months Create a Spending Plan Step by step plan for meeting expenses in a given period of time Why o Helps you reduce the anxiety of not knowing whether you have enough money to pay your bills when they are due o Gives you a sense of control over your money rather than letting money have control over you o Helps you build assets that will help improve the quality of life for you and your family Spending Plan Steps o Keep track of your daily spending o List your monthly income and expenses o Find ways to decrease spending o Find ways to increase income Track Daily Spending Understand where you money goes by tracking your spending Use a personal spending diary Determine Income and Expenses Income is money that comes to you from o Wages o Self employment income o Public assistance o Child support or alimony o Interest dividends or investments o Social security or other federal benefits o Other sources like tips Income o Gross income Total income without reductions o Net income Gross income Deductions Also called take home pay Expenses o Fixed Expenses Do not change from month to month Don t have control over how much you pay Ex Rent or fixed loan payment o Flexible Expenses Often change from month to month You have some degree over how much you pay Decrease Spending o Tips to help you decrease spending Develop and follow a spending plan Carry small amounts of cash to limit spending Consider keeping your credit cards in a safe place at home Use coupons to save money and only buy items you need Use a grocery shopping list to avoid impulse buying Take your lunch to work instead of eating out Pay your bills on time to avoid penalties Use direct deposit for all sources of income Keep Accurate Records o Keep records in a safe place o Organize your files so it is easy to find important financial information o Keep your tax records for at least 3 years o Pay bills online or mail check to pay bills at least one week before they are due to avoid late fees Budget Tools o Monthly Payment Schedule o Monthly Payment Calendar o Budget Box System Small box with dividers for each month o Expense Envelope System o Computer Spreadsheet System When there are more expanses than income o Pay your necessary household expanses first Rent mortgage food Think about the health and safety of your family when prioritizing bills Seek assistance to help cover expenses Paying your loans o Pay off loan with the highest interest rate o Talk to your creditors o Get credit counseling


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