By Konnie M. Werner, President/CEO
Dear Members,
Although everyone’s financial situation is unique, there are steps that we can take to help us weather these trying economic times. These include striving to live within our means, cutting back on non-essentials, saving more and reducing our dependence on credit.
It starts with reviewing the way that you spend money currently and identifying those “luxury” items that you could cut or even greatly reduce. For example, target those expensive coffee drinks or even those fast food meals that seem to be purchased more frequently than you ever intended. You would be amazed by the amount of money many people spend on items like these on a daily basis and how much it can impact your bottom line.
Even though the best way to use a credit card and avoid paying interest charges is to pay the balance once it becomes due, if you have a large outstanding balance, that’s just not possible. In these cases, it's important to try and pay as much as possible monthly or even make more than one payment per month. This will help you pay off the debt sooner and also increase your available credit amount. Having credit available gives you a little cushion of available money in case an emergency expense comes up. As a rule of thumb, do not use your credit cards for non-essential items, if you cannot pay the balance in full when you receive the statement. Only paying the minimum balance on your cards(s) as you continue to rack up new charges is very dangerous. This practice only adds to the actual cost of the items (when you include interest) and adds a greater financial burden on your future. So remember, before you make that next purchase using your credit card to ask yourself a few questions, “Is this really worth the added cost if I don’t pay it off immediately?” or “Can I budget and save for this item instead?” In most cases you will be glad that you took the time to have a talk with yourself to help safeguard your finances. Credit is easy to get but can be very difficult to payoff when you aren’t careful.
Remember, in most cases it isn’t about how much you earn, but instead how you spend your money!
Stay tuned to future monthly newsletters for more tips on “Living Within Your Means”. For more information on personal finances and ways to safeguard your financial information including free informational pamphlets, please visit our “Planning for Life” webpage.
