Reboot Your Finances

a couple sitting on their couch looking at a laptop and paperwork, and a tagline that says Improving Savings and Debt Management

The pandemic is affecting us all. Times are uncertain, but this can also be a time to really get your financial life in order and learn some money-saving hacks. We at MSA are here to help you craft your own personal financial reboot. One way to get started is to review your debt situation and how you might increase your savings.

Getting a Handle on Your Debt
During the pandemic, the government and individual companies have offered forbearance – not forgiveness – for credit card, mortgage or student debt. That means that they are giving you a breather and kicking the can down the road for future payment. This is a great time for you to take that breath and create a plan for your situation.

The first thing to do is to get a realistic tally of all of your debt. Make a list of all of your credit card debt, student loans and mortgage debt. List the amount, the lender, the interest rates, payment terms, etc. This way, you can really look at the landscape and figure out how to fit debt payments in your budget.

It may be overwhelming to think about all of this and hard to do on your own. We often have a knee-jerk reaction to debt and pay the first bill that comes in, but that may not be the best strategy for every situation. Work with a Money Coach who can assess your situation and make suggestions for you to work out a realistic plan.

Tips on Saving Money When You Shop In-Store
We know that there are only two ways to boost your budget: earn more or spend less. It’s not that easy to earn more, especially in today’s world, but we can give you some tips on how to spend less. Here are some simple tips to tighten your belt:

Cut out the Cuts
Many grocery stores are offering money-saving purchases. For instance, instead of buying expensive meat and poultry, you can look for cheaper cuts. For example, chuck roast meat and chicken legs are cheaper cuts than sirloin and chicken breasts. Even less expensive meats and poultry provide valuable protein.

Buy Basics in Bulk
Big box stores offer great buys on paper products and other items. If you can’t store these items or you feel that your family just can’t really use 20lbs of sugar this winter, get the neighbors together to share the cost of the bounty.

Coupons
Have your kids comb the internet for coupons on brands of food and items you use. Buying generic options rather than well-known brands are also a great way to save money.

Does it really add up?
Let’s say that these buying/saving tips save pennies here and pennies there that add up to dollars. And remember, it also saves on gas because your trips to the store are cut down. If you can save $25 per month on gas, that’s $300 a year!

Tips on Saving Money in the Digital World
The pandemic has caused all generations to shop online. In the beginning of the pandemic, when we were staying at home, online shopping got to be a recreational activity for many. We called it “comfort shopping”… but how many pairs of shoes do you need if you are staying home and would rather be wearing your fuzzy slippers?

3-Day Rule
The best thing to do is to make a list before you start clicking. Use the internet to research and discover discounts and deals. Consider a 3-day rule: try hard to hold off clicking on your purchase for 3 days before you decide to buy the item. In the meantime, ask yourself these questions:

  • Do I really need this?
  • Is this a planned or impulse purchase?
  • Does it fit into my budget?

Also remember that shipping can add a high cost. Some websites offer free shipping as long as you reach a minimum purchase price. Whether or not you purposely try to buy enough items to get free shipping, just make sure your overall cost is still within the budget you set for yourself.

Now what?
Even small savings can really add up. Suppose you apply all of these tips and decide to put that money towards reducing debt or building emergency savings? Let’s put some numbers to this:

Let’s say that you save $6.00 a week using the shopping tips ($312.00 a year). Let’s also suppose you say, “No” to an impulse purchase each week that costs $25.00 ($1,300 a year). In total, you would have now saved over $1,600 a year. That could add up to a few debt payments or certainly contribute to your savings goals. By saving $1,600 per year over a 10-year period, you would not only build a sizable emergency savings account, but your financial confidence would soar. If you already have emergency savings, you could consider investing the $1,600 per year. Over 10 years, earning a 5% compounded interest rate, that “little savings” could add up to over $20,000!

If you would like helpful worksheets and additional information about debt management strategies, talk to an MSA Money Coach. They can explain the different options for tackling debt and help you determine which is best for your situation. A Money Coach can also provide accountability and suggestions for improving your savings. They can provide best practices for establishing an emergency fund and how to balance multiple savings goals at once. Call 888-724-2326 today to talk to a Money Coach and start rebooting your budget with new savings and debt management goals!