Financial Self Reliance

4TH WardDecember 30, 2012

Tithing

• Pay tithing first• Get the Lord on your

side• “Prove me now

herewith…”

Buying a Home

• Buying a home should be your top financial priority

• Paying off the mortgage before you retire should be your next priority

• Utah Housing Corporation helps low income families buy a home with no down payment

Budgeting

• Plan your spending• Monitor your spending• Save for the future• Mint.com is free and

automated

Get out of debt

• List your debts smallest to largest

• Make all scheduled payments

• Add 1% of your income to the smallest

• Once it is paid off, apply the 1% plus the payment of the smallest loan to the next smallest.

Saving for Retirement

• Start today• Always contribute to your

401k enough to get the company match

• Savings in your 20s could grow 20-fold

• Savings in your 30s could grow 10-fold

• If you are not yet 40, you will need $1 million to retire

Saving for Missions

Year Missionary

Leaves

Estimated Monthly

CostCalculated Total Cost

Monthly Savings

Required2013 $ 400 $ 9,600 $ 400 2014 $ 405 $ 9,720 $ 262 2015 $ 410 $ 9,840 $ 197 2016 $ 415 $ 9,960 $ 158 2017 $ 420 $ 10,080 $ 132 2018 $ 425 $ 10,200 $ 113 2019 $ 430 $ 10,320 $ 99 2020 $ 435 $ 10,440 $ 88 2021 $ 440 $ 10,560 $ 80 2022 $ 445 $ 10,680 $ 72 2023 $ 450 $ 10,800 $ 66 2024 $ 455 $ 10,920 $ 61 2025 $ 460 $ 11,040 $ 57 2026 $ 465 $ 11,160 $ 53 2027 $ 470 $ 11,280 $ 50 2028 $ 475 $ 11,400 $ 47 2029 $ 480 $ 11,520 $ 44 2030 $ 485 $ 11,640 $ 42 2031 $ 490 $ 11,760 $ 40

Elders

Saving for Missions

Year Missionary

Leaves

Estimated Monthly

CostCalculated Total Cost

Monthly Savings Required

2013 $ 400 $ 7,200 $ 400

2014 $ 405 $ 7,290 $ 237

2015 $ 410 $ 7,380 $ 170

2016 $ 415 $ 7,470 $ 132

2017 $ 420 $ 7,560 $ 108

2018 $ 425 $ 7,650 $ 92

2019 $ 430 $ 7,740 $ 80

2020 $ 435 $ 7,830 $ 70

2021 $ 440 $ 7,920 $ 63

2022 $ 445 $ 8,010 $ 57

2023 $ 450 $ 8,100 $ 52

2024 $ 455 $ 8,190 $ 48

2025 $ 460 $ 8,280 $ 45

2026 $ 465 $ 8,370 $ 42

2027 $ 470 $ 8,460 $ 39

2028 $ 475 $ 8,550 $ 36

2029 $ 480 $ 8,640 $ 34

2030 $ 485 $ 8,730 $ 33

2031 $ 490 $ 8,820 $ 31

Sisters

Saving for CollegeSaving Plan for BYU (Estimated Costs)

Year Student Starts College Annual Cost Total Cost

Monthly Savings

Required

2013 $4,860 $20,618 $413 2014 $5,054 $21,443 $340 2015 $5,257 $22,300 $292 2016 $5,467 $23,192 $257 2017 $5,686 $24,120 $232 2018 $5,913 $25,085 $212 2019 $6,149 $26,088 $197 2020 $6,395 $27,132 $184 2021 $6,651 $28,217 $174 2022 $6,917 $29,346 $165 2023 $7,194 $30,520 $158 2024 $7,482 $31,740 $151 2025 $7,781 $33,010 $146 2026 $8,092 $34,330 $141 2027 $8,416 $35,704 $137 2028 $8,753 $37,132 $134 2029 $9,103 $38,617 $131 2030 $9,467 $40,162 $128 2031 $9,845 $41,768 $126 2032 $10,239 $43,439 $124 2033 $10,649 $45,177 $122

• Tuition at BYU is increasing at a faster rate than inflation but slower than the average of tuition inflation at other schools

• The chart covers only tuition

• Virtually any other school will cost more

Driving a car

• Most people spend too much on their cars

• Cars will do more to harm your financial condition than anything except addictions to gambling or drugs and alcohol

• Don’t borrow money to buy cars

• Don’t replace your car often (think 7 to 10 years for new cars and 4 to 7 for used cars)

Taxes

• Earned Income Tax Credit

• Mortgage interest and tithing are deductible only for high income households

Insurance

• Car insurance• Life Insurance• Homeowner’s

Insurance• Health Insurance-

CHIPs (health insurance for Children)

Banking

• Financially successful people use financial institutions

• Money is safer in the bank

• Money earns interest• Payments are easier

and cheaper• You MUST play by the

rules

Investing

• Cash in the bank earns less than inflation

• Stock picking and day trading are fun hobbies that are more expensive than golf

• Mutual funds and ETFs were invented so that regular folks could invest in stocks and bonds without too much risk

Top Ten Tips

• Pay Tithing• Buy a home• Pay off your home

before you retire• Don’t spend too much

on cars• Save for retirement

• Save for your children to serve missions

• Save for your children to attend college

• Insure risks you can’t afford to take

• Invest wisely using no-load mutual funds

• Choose the right bank