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Plan for Success


Knowing your goals is the first step to reaching them. So, it is best to start with a solid plan, one that is well thought out and realistic so you stay on track. Take advantage of our simple tips today to achieve your short-term and long-term goals for tomorrow.



Reaching Your Goals

To reach your goals, you need to do 3 things:


  1. Budget for short-term goals (Example: Save $100 each month for the next 6 months to save for a family trip or to build your emergency fund.)

  2. Save for mid-term goals (Example: Set aside $200 each month for the next year to save for a down payment on a car.)

  3. Invest for long-term goals (Example: Save $200 each month to have $12,000 for a home down payment in 5 years.)

Creating a Spending Plan

This is your blueprint to success. To create your spending plan, determine how much money is available (income), where it is being spent (expenses), and what adjustments can be made. Remember to make informed choices on all purchases in order to control your financial future.

Tracking Your Spending

How much you spend does not have to be a mystery. Everyone buys things they do not need, but if it happens too often, it can sabotage your goals. So, try this: for the next two weeks, track each and every penny you spend in a notebook. Then, evaluate your spending habits. You will most likely notice room for improvement.

In the meantime, focus on trimming expenses. How? Try these tips:

  • Eat out less.

  • Curb impulse buys.

  • Comparison shop.

  • Limit (or stop!) using your credit cards.

  • Bundle errands to save gas.

  • Stick to your shopping list.

Did you know that if you nix your daily snack or soda ($.75),
you will save $274 in a year and $1,369 in 5 years?

Tips for Success


Staying Motivated

  • Communicate your goals -Write them down and post them where you will see them every day.

  • Bring the family into it -Encourage one another and embrace a collaborative outlook on your finances.

  • Exercise control - Become your own biggest fan and praise yourself for staying focused. Ignore urges to give up or "just take one day off."

  • Reward yourself - Once you meet a goal, congratulate yourself. Just be frugal, so that you continue to build wealth, not spend more.


Making it a Habit to Save Everyday

  • Program your thermostat to reduce the energy used to cool and heat your home when everyone is away.

  • Explore college savings plans early to ensure your child's future education is one less financial worry.

  • Consolidate high-interest debt into one low payment, with a home equity loan.

  • Save money at the wheel by inflating tires to avoid wasted fuel, excessive tread wear, and safety issues.

  • Use Online Banking to save time, stamps, and gas.

  • Place jars throughout your home to stash loose change from your purse, wallet, or pockets.

  • Rent movies for free at your local library.

  • Visit annualcreditreport.com to review your free credit report annually.

  • Reduce paperwork and increase organization by signing up for eStatements, Online Bill Pay, and Direct Deposit.


Teach Your Kids to Save

  • Show your kids how to shop for quality and value.

  • Educate yourself in order to become a financial role model.

  • Take them with you to see branch transactions.

  • Turn clipping and using coupons into a fun game.

  • Encourage kids to earn money by doing chores and give an allowance to set aside for savings.

  • Set goals, like saving for a bike.

  • Bring them to the Credit Union to open up their very own savings account and watch their money grow!


Tips for Financial Success

By following these simple steps, you can make plans to thrive, not just survive!


Get an Accurate Picture of Your Current Situation

A good place to start is by looking at where you are at and where you would like to be by the end of next year. Financially, you can assess your situation by adding up the value of your assets (home, car, furniture, etc.) and subtracting out liabilities (debt) to find your net worth. A simple but effective goal is to increase your net worth by the end of the next year. You may want to break this down into smaller goals such as reducing your expenditures, or increasing your earnings and/or savings by a specific amount each month.


Spend Less

Gather information from your checking account and credit card statements for a rough estimate of how much you spend in categories like food, entertainment, transportation and gifts. If you want a more accurate number, keep track of every expenditure for a month, including small cash purchases. You may want to carry a small notepad to keep track of them. This will give you a good idea of where you can realistically cut back. Then, set a budget, and look for ways to eliminate non-necessities like entertainment or meals out and save on necessities by utilizing sales and coupons.


Borrow Smart

If you have a mortgage, home equity, auto loan, or credit cards, make a list of all your balances and the interest rates you are currently paying. Chances are, you may be able to lower your interest rate and/or monthly payments by refinancing or transferring balances. Visit www.doverfcu.com for a complete listing of all loan rates and a convenient online application.


Earn or Save More

If you find that your spending exceeds income, consider finding ways to supplement your income. For example, a part-time second job, work you can do at home in the evenings, or freelance work that can be carried out on the weekend. Another source of income may be to sell unneeded items at a garage sale or through a reputable online service, such as eBay. No matter how much (or little) your income may be, be sure you are setting aside a portion every month in a savings or investment account. Use Direct Deposit or Payroll Deduction so the amount is deducted from your check before you are tempted to spend it.


Improve Your Bottom Line

Getting ahead financially means spending less and saving more. Here are two ways to accomplish these goals in the coming year.

#1 Reduce Expenses:

Take a Look at Your Mortgage Loan

Since a mortgage payment or rent is typically your largest expense, a regular review of home financing is necessary. Some reasons you may want to refinance or buy a home include:

  • Taking advantage of the tax benefits of owning a home

  • Building equity in a property as an investment

  • Lowering your interest rate or obtaining more favorable terms on a current home loan

  • Take advantage of your home's equity to consolidate any high-interest debts

  • Converting a risky adjustable rate mortgage to a fixed rate loan


#2 Increase Your Savings:

Invest Wisely

Maximize the earnings on your savings by investing it. Depending on how quickly you might need to access your money, consider these options:

Getting Organized

Organizing your financial records may not be the most fun, but it is a critical part of achieving financial success. Imagine walking into a messy room every day. It is simply not conducive to happiness. In the same way, financial success depends on being clutter-free. By organizing your financial records, you are actually laying the path, brick by brick, to your future success!


The benefits of being organized:

  • Have more time, energy, and space

  • Find key documents, papers, and receipts quickly

  • Reduce and help eliminate late fees

  • Gain a greater peace of mind


Things you may need:

  • Envelopes, bill organizers, and file folders

  • A shredder

  • Filing cabinet or fireproof safe

  • Computer software, if desired

  • Storage containers or boxes


Developing Your Financial Routine

First off, decide when and how you will pay your bills. You can schedule and send payments when you receive them or keep a consistent routine, like the 1st or 15th of every month. Whatever you do, make sure it works for you and is easy to maintain.


Paperless has its perks

Online Banking reduces paperwork and allows you account access 24/7, 365 days of the year. You can check your balance, transfer money, and download your account information. It also protects your identity!


Make it automatic

An automatic routine is an efficient one. Set up your bill pay system to schedule regular payments to avoid late or missed payments and decrease the chances of a check getting delayed in the mail. Plus, you will save time, postage, and paper.


Find your balance

Remember to gather and keep all your bills in one location and organize them regularly. Read credit card statements closely. You may even enlist the help of computer software, like Quicken or Microsoft Money. If you do so, ensure that you have anti-virus and anti-spyware software installed on your computer and keep it updated regularly. You do not want anyone but you accessing your important and very personal financial records.

 

Getting Your Finances Organized for the New Year

A New Year's Resolution with a Big Payoff

Invest some time each year in getting your finances organized and you will end up saving time and money all year. You will be able to eliminate overdraft and late fees, easily evaluate where your money is going, and save money on taxes.


Stay Organized with an Annual Clean-Up

The beginning of each year is an ideal time to file or throw out all financial documents from the previous year and start fresh. Be sure to shred any documents containing sensitive personal or financial information before disposing of them.


What to Save and What to Throw Away

As you get organized for the New Year and for tax season, here are some guidelines to consider:

  • Tax returns. Consider permanently storing your copy of completed tax returns. In many cases, the IRS destroys the original returns after four or five years, so you may need your copy to fall back on.

  • Canceled checks, deposit statements, and receipts. In general, keep these for at least three years. If a receipt is for something that appears on your tax return (such as home improvements), then keep it with that tax return.

  • Weekly or monthly salary statements. These can be thrown away after you check them against your annual W-2 Form.

  • Medical Expense Documents. Keep all medical bills for three years to back up your canceled checks.

  • Stock trade confirmation receipts and statements. Keep these for at least three years after both ends of the transaction (the purchase and the sale) have been completed.

  • Proof of improvements to your property. Store at least three years (preferably seven) after the sale of the property to prove your basis in the property when it is sold. Certain improvements add to the cost basis of your property, thus reducing any capital gains you may have when you sell. This applies to rental properties, investment properties, and even your personal residence.

  • Escrow closing documents. Store a minimum of three years after the property is sold. Retain both the purchase escrow and sales escrow statements.


Keep It Simple

Many organizational systems fail because they are too complicated. One easy way to get started is with an accordion file folder and a calendar or bill payment checklist. Keep track of when bills are due and mark them off on your checklist or calendar as you go. File bill notices as they arrive in the accordion folder based on the date they are due. Keep tax related receipts and paperwork in a separate accordion folder organized by category.


Where to Store Important Documents

Consider renting a safe deposit box to store family birth certificates, wills, real estate, and tax documents, along with other valuables. Safe deposit boxes are available to Dover Federal members at the offices on Saulsbury Road and North DuPont Highway in Dover, as well as our office in New Castle on Route 40 at Applebee Road. Another option is to store your valuable papers in a fireproof box in your home. Be sure to let another trusted family member know where you are keeping these important documents.

Dover Federal Credit Union • All rights reserved 2013
Dover Federal Credit Union is an Equal Opportunity-Affirmative
Action employer.
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