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Saving & Investing (3 Part Series) Part 1 – Making a Financial Plan

What are the things you want to save and invest for?

  • a home
  • a car
  • an education
  • a comfortable retirement
  • your children
  • medical or other emergencies
  • periods of unemployment
  • caring for parents

Know your current financial situation.

  • Sit down and take an honest look at your entire financial situation. You can never take a journey without knowing where you’re starting from, and a journey to financial security is no different. You’ll need to figure out your current situation – what you own and what you owe.

Know your income and expenses.

  • Keep track of your income and your expenses for every month. Know what you and others in your family earn and know what all expenses are.

Pay yourself or your family first.

  • Include a category for savings and investing. What are you paying yourself every month? Many people get into the habit of saving and investing by following this advice: always pay yourself or your family first. Many people find it easier to pay themselves first if they allow their credit union to automatically remove money from their paycheck and deposit it into a savings or investment account.
  • Participate in an employer sponsored retirement plan. Your employer may offer a matching contribution. When your employer does that, it’s offering “free money.”
  • Any time you have automatic deductions made from your paycheck, you will increase the chances of being able to stick to your plan and to realize your goals.

Finding money to save or invest.

  • If you are spending all your income, and never have money to save or invest, you’ll need to look for ways to cut back on your expenses. When you watch where you spend your money, you will be surprised how small everyday expenses that you do without add up over a year.

Small savings add up to big money.

  • How much does a cup of coffee cost you?
  • Pay off credit card or other high interest debt.
    • Put away the plastic.
    • Know what you owe.
    • Pay off the card with the highest interest rate.

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