session # 4 financial planning
TRANSCRIPT
Setting Financial Goals
• When you are setting a financial goal, it is important to set a realistic goal
• A goal that you are likely to achieve, not one that may be difficult for you
Setting Financial Goals
• Make a list of 3 or 4 things you would like to accomplish
• Suggestions:
• Spend $10 less each week
• Pack a lunch instead of eating out
• Save $40 each month
• Pay an extra $20 each month towards my debt
Setting Financial Goals
• Which goal do you feel is most important to you?
• Circle or highlight that goal on your list
Setting Financial Goals
• What resources will you need to help you achieve this goal?
• A savings account
• A spending tracker
• A financial advisor
• Make a list
Setting Financial Goals
• How long will it take you to achieve your goal?
• 6 months
• 1 year
• 2 years
• Set a completion date
Setting Financial Goals
• Look at your calculations for cutting costs from last session
• Which of these costs are you going to cut to help you achieve your goal?
SAVING TIPS
• Set up an emergency fund first
• In case of unexpected expenses or the loss of your job
• You can use your emergency fund instead of your savings so you don’t have to put off achieving your goal
SAVING TIPS
• How much should be in your emergency fund?
• It is recommended that you save between 3 & 6 months worth of your income
• eg. If you make $2,000.00 each month, you should have somewhere between $6,000.00& $12,000 saved in case of an emergency
SAVING TIPS
• Pretend your savings is just another bill
• This will ensure that you pay your savings account every month
SAVING TIPS
• Have your bank automatically transfer money from your chequing account to your savings account
• This way you don’t have to worry about remembering to go to the bank each week or month
TIPS FOR REDUCING DEBT
• Pay down the debt that has the highest interest rate FIRST
• This will save you money in the long run because you will have paid less in interest
TIPS FOR REDUCING DEBT
• Avoid using credit cards & “buy now, pay later” offers
• If you don’t sign up for a credit card you can’t create debt for yourself
• “buy now, pay later” offers tend to have high interest rates
• If you can’t afford the product now, don’t make the purchase
TIPS FOR REDUCING DEBT
• Speak to creditors to ask for lower interest rates
• If you are paying less interest you can pay your debt off faster and save more
TIPS FOR REDUCING DEBT
• Speak to a financial advisor about consolidating your debt
• Consolidating debt occurs when you get one loan to pay off all of your debts
• You can then make 1 payment every month
• Sometimes the interest rate will be lower than your existing interest rates
Making our Goal Official
• Complete the financial goal pledge form
• Have a friend or myself sign as your witness
Milestone # 30
• Create a table to organize & compare
• This is something you should do before making a major purchase or signing up for a service
• Use the computers or hand draw your charts