SECURE YOUR FINANCIAL FUTURE! INVEST IN YOU!
Welcome to Money 101, Invest in You: Ready. Set. Grow’s eight-session guide to financial wellness. I’m happy you’ve joined us!
As CNBC’s senior personal finance correspondent, it’s my mission to teach people how to manage, grow and protect their money. Each week, you’ll receive a new exercise in your inbox from me that can help you get control of your money so you can start focusing on your life.
While it’s easy to get scared off by the thought of numbers and spreadsheets, please don’t. This isn’t about that. Think of this more as a financial health program.
The lessons have been broken down to tackle the following subjects: handling your budget, creating an emergency savings, building wealth through 401(k) plans and individual retirement accounts, home buying, saving for college, investing in your health, life and property insurance, and estate planning.
You’ve taken the first step toward leading a better financial life. Thanks again for joining me — and happy learning!
CHALLENGE #1: CREATE A BUDGET &
MAKE YOUR MONEY LAST
To start down the path of financial freedom, the first thing you need to think about is your budget.
- Track the money that comes in, like your paychecks, and tally it up.
- List the money going out: your expenses and your savings.
- List your large bills, like the mortgage or rent, car payment and child care.
- Then, add up the monthly bills that stay about the same every month, such as internet, phone, utilities and student loan debt. Also include the amount you allocate to savings.
Include everything you're spending money on, like clothes and dining out, too.
To decrease your spending, focus on your needs versus wants. Needs are things you can’t live without, such as housing and food. Wants are things like eating out and cable TV/streaming services.
To tackle your credit card debt, you first need to figure out how much you owe. Make a list that includes the interest rates, the total amount owed and minimum monthly payments for each card. Rank them from the highest interest rate to the lowest and start paying them off in that order.
Also, cut up your credit cards or limit yourself to just the one with the lowest rate.
You can also try to get a lower rate on your current card by telling the creditor that you want to cancel your card because you’ve gotten a better offer from a competitor. Or, find a card with a lower annual percentage rate (APR). If you get a new card, consider consolidating your debt into one low-interest rate card. Just make sure to pay it off before the introductory period of the low rate ends.
Finally, bump up your payments as soon as you can. It will take a long time to pay down your debt if you are only making the minimum payments.
“You can and should set your own limits and clearly articulate them. This takes courage, but it is also liberating and empowering, and often earns you new respect.”
―Rosalind Brewer, Businesswoman/CEO, Walgreens Boots Alliance
Congratulations! You’ve made it through your first lesson and are one step closer to achieving your goals.
Next week, be on the lookout for another lesson, which will help you build an emergency savings.
We look forward to continuing to help you — Invest in You!
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