Plan For Your Future

Budgeting

If you can't seem to stay on top of your finances or you feel financially strapped at the end of the month, we can help! Figuring out how much money you need each month for expenses such as housing, groceries, bills, savings and other living expenses, you can then determine how much money you have left over for incidental expenses like entertainment, vacations, and dining out. You can't reach the top of the mountain without taking that first step, and you can't expect to reach your financial goals if you don't have a plan in place. Working within a budget will keep your finances on track by keeping you from spending more money than you have, and helping you to reach your financial goals. Whatever your goal is, whether it's saving up to purchase your first home, saving for your child's college tuition, or even having enough money saved up to take your dream vacation, a budget will put you on the right path for success. To get you started, we've given you some steps you should take to create a budget for yourself and start you on the road to financial freedom.

1. Track Your Spending.
It's hard to know where your "financial leaks" are if you don't know where your money is going. Track your daily expenses for a month, write down everything you spend money on, from a cup of coffee, to groceries. It's a good idea to determine whether you use cash including a check or TMcard, or a credit card. Knowing where your money goes will help you to determine how it should be allocated.

2. Pay Yourself First.
You work too hard for your money not to pay yourself first. It's best to have a pre-determined amount automatically debited from your account into a savings or a high interest earning account like our Money Market Savings or Money Market Index Account. Whether you choose to have money debited from your account every paycheck or once a month, you will see how quickly the benefits add up!

3. Determine Spending and Allocate Expenses.
Although experts recommend that you should allocate approximately 35% of your budget to housing expenses, the average Southern California homeowner may find that a difficult number to hit. However, the good news is that since the principle you pay on your mortgage is actually a form of forced savings, and the interest you pay on your mortgage may be tax-deductible*, you can actually increase that percentage. Even though interest rates are fluctuating, we can still offer you fixed-rate mortgage products at very affordable rates. Visit one of our branches today or call (877) 495-1600 to speak to one of our Member Service Representative about our First and Second Trust Deeds, or to apply for a Home Equity Line-of-Credit.

4. Pay With Cash.
Believe it or not, cash is still cool! Once you have determined your expenses, it's actually best to pay for your daily incidentals like gas, and groceries with cash. There are many ways to make this process easy and painless, but one of the best ways is to use the "envelope method." Figure out how much cash you need on a weekly, bi-monthly, or monthly basis for things like, groceries, gas, and entertainment and put each amount into individual envelopes. Try to refrain from visiting your local ATM more than once a week or even once a month, and keep your temptation at bay by leaving debit and credit cards safely locked away at home. By just using the cash you have on hand, you will see where your money is going and enjoy greater success with staying on your budget.

5. Kick The Credit Habit.
Don't outspend your paycheck! If you have credit card debt, pay it off as quickly as possible and then let your cards cool off at home. Better yet put them on ice in your freezer! Once your credit card balances are paid off, don't close the account as that can adversely affect your credit score, but keep the balance at zero, and don't use the card unless you are sure you can pay off the balance in full every month. Whether you pay off the smaller balances first, or tackle ones with the highest interest rates, at least pay more than the minimum balance every month. The quicker your debt is paid off, the more in control you will be of your finances and your future.

6. Build Your Safety Net.
No matter where your debt is right now, you should be setting aside a rainy day fund. Experts say that you should have at least three to six months worth of monthly expenses saved up in case you are hit with an unexpected medical bill, or you or your spouse become unemployed. In the beginning even $1000.00 in your savings can be the difference between your financial setback and success. It doesn't take much to knock the wind out of your sails, but the better prepared you are for a rainy day; the better you will be able to weather the storm.

7. Live Within Your Means, Not The "Jones's."
If you follow the steps we've suggested, you will find that you can live a full life, still enjoying all the extra splurges like vacations, and dining out, but you will also be able to sleep at night knowing that your bills are paid, and creditors are harassing someone else, not you! Don't worry about "keeping up with the Jones'", because along with that shiny new car, new clothes and the latest and greatest new gadgets, they may also be sporting fancy shiny new debt to go along with that. At California Coast Credit Union, we have your best interest and know that the steps you take today will put you on the right path for tomorrow. We've been helping people since 1929.

* Consult your tax professional to determine if you are eligible to deduct mortgage interest on your taxes.