While you can’t predict emergencies by their very nature, there are certain things you can do to prepare for if and when one comes your way. Financial emergencies are actually easier to prepare for than you might think. While you might not know when they’ll happen or how much money you’ll need to handle them, you can be adequately prepared as long as you start now and stick to it.
Creating an Emergency Fund
Emergency funds can be used for any true financial emergency. The more you have, the more prepared you’ll be, but experts recommend saving up about six months’ worth of living expenses in your emergency fund. This should give you enough of a cushion in the event that you lose your job or become injured or ill and cannot work.
Living Below Your Means
Spending less than you make is the key ingredient in building wealth and that includes saving for an emergency. If you spend 100% of what you make, losing your income will hurt you worse than if you only spent 50% of your income. Using a budget is a great way to see where your money is going and if you really need to be spending as much as you might be.
Being Covered by Insurance
You never know what life has in store, but insurance can help you prepare for the worst. Disability insurance can cover your income and a life insurance policy is recommended for couples who are dependent on one another’s income. Check with GCS Credit Union to find out the best insurance options for you.
Having a six-month emergency fund, spending less than you make, and having insurance just in case are just a few ways to prepare for a financial emergency. GCS Credit Union has a variety of financial products and services designed to help you save money and prepare for your future. Give us a call today at (618) 797-7993 to learn more.
Many of life’s big events will stick in your memory forever, but the problem is that many of these same events can cost quite a lot of money. Planning ahead can help you prepare for a big life event financially, and a budget is the best tool to help you do exactly that. No matter what your big event might cost you, a budget can help you get on track and find out how long you’ll need to save money for.
Going to College
College is expensive, but there are ways to get an education without piling up a mountain of debt. Most teenagers aren’t very responsible, so it’s your job to help them budget for college. Scholarships are the best way to go and choosing a more affordable college like a junior college can also help. Encourage your kids to get a summer job and put all their earnings into a savings account from GCS Credit Union. While in college, budgeting is also very important, so you don’t spend or borrow more than you need to.
Your First (Real) Job
Now that you’ve graduated college without too much debt, the next step is to get your first real job. You might not be making as much as you’d hoped right away, but a budget can help you live below your means. Be sure not to pay too much for a place to live and don’t go out and buy a more expensive vehicle than you can afford. Be sure to budget for every category including housing, utilities, food, and gas among others.
Getting married can be a fabulous event, but a crazy wedding can put you in debt for years to come. Start budgeting for your wedding in advance, and it’ll take some getting used to when you combine finances with your spouse. Make a budget for your big day and stick to it.
You’ll never forget the first time you laid eyes on your little bundle of joy, but kids are expensive. You’ll need to pay for diapers, formula, child care, schooling, and so much more over the years. Budgeting can be a bit tricky with your first kid, but you’ll get the hang of it over time.
Buying a Home
Buying your first home is an exciting event, but it’s certainly costly. It’s best to put down as much of a down payment as you can so that you can lower your monthly mortgage payments to make them more affordable. Find a house that you can realistically afford according to your budget and do your best not to go over that amount. GCS Credit Union can help you determine how much house you can afford, and we can get you on your way to homeownership.
Once you retire you’ll no longer be receiving your paycheck to live off of. You’ll be living off your savings and investments including your 401(k), money market accounts, and more. Hopefully you’ve put enough away for retirement, and that amount will determine how much you have to work with every month. Your budget will come in handy every step of the way, but especially when you retire.
At GCS Credit Union, we’re here to help you get through life’s big events. Contact us today by calling (618) 797-7993 to learn how to become a member and take advantage of our great financial products and services.
Back-to-school season is upon us again, even though it seems like the summer barely got off the ground! Unfortunately, with the back-to-school season comes the dreaded back-to-school shopping, which most parents find stressful because it’s so expensive. According to the National Retail Federation, the average U.S. household will spend almost $700 on getting ready for the school year, and for parents of college kids that number is even higher: it’s a whopping $976.78. How do you get your kids back to school without breaking the bank? It takes a little bit of planning, but you can create a budget for back-to-school and maybe even save yourself some money.
- First, determine what you need. Take the list provided by the school district or teacher, and then look around your house. You probably have a pretty healthy inventory of school supplies at home, so if you organize those, you may be able to reduce your shopping list. While you’re at it, review your child’s wardrobe and make note of additional clothing he or she will need to start the school year. It’s probably not necessary to buy a lot of new clothes, but it’s nice to have a “first-day” outfit, and there are some essentials that may need replacing. Consider less tangible back-to-school items as well, like a new haircut or a physical. Once you’ve compiled your list, estimate what each item on the list will cost, so that you can have a good idea of your projected expenditure.
- Set your spending limit. It’s important to do your back-to-school shopping with a spending limit firmly in place, or impulse purchases may derail your budget. Be fiscally conservative, estimating the cost of items at their regular price and not the current sale prices, so that you’ll have a bit of leeway when you actually go to the store. If the projected expenditure exceeds your limit, take a hard look at the list and see if there’s anything that can wait until later.
- Try to find some extra cash to pad the budget. You might be able to work a few extra hours, or find a temporary side job, just to give yourself some breathing room. On the other hand, if your children are preteens or teenagers, you might talk to them about contributing toward their own expenses. Especially if they want some trendy items that are a bit pricey, they should be expected to help pay for them. This is helpful for you, but it’s actually good for your kids as well, because it helps them learn about financial responsibility.
- If you’ve got a few paychecks between now and the first day of school, divide the expenses between them. Set aside money from each paycheck, and it won’t feel like as much of an expense as it would if it all came out of one check. Look for different ways to set aside money, perhaps challenging yourself to set aside all of one denomination of cash, or round up your purchases and put the extra into your back-to-school fund. You might even put yourself on a discretionary spending freeze, in order to save up for your school shopping.
- Shop wisely. Before you head out for school shopping, study several ads, and determine which store has the best deals. You might even consider hitting more than one shop, in order to cut down on your spending. Look for ways to save even more, by shopping consignment stores, taking advantage of your state’s tax holiday, using coupons, and buying generic. Allow your child a couple of splurge items, but save money wherever you can.
Need to set up a savings account so that you have a place to safely stash your back-to-school cash? Look no further than GCS Credit Union. Since 1941, GCS Credit Union has been serving customers in Illinois, providing loans, basic savings, and other banking services. Having started as a single location, we’ve spread throughout the area, and now support Sangamon, Logan, Macon, Marion, Jefferson, Perry, Jackson, Williamson, Jersey, Macoupin, Montgomery, Madison, Bond, Clinton, St. Clair, Monroe, Washington and Randolph counties. Dedicated to focusing on our members’ financial needs, we’re a not-for-profit, member-owned financial cooperative. If you’d like to know more about the benefits of a credit union, call (618) 797-7993, or contact us through our website.