Back to School Money Tips: Three Ways to Ensure You’re Financially Healthy
It’s that time of year already – back to school time! If you’ve been in just about any store, you’ve seen the tidy displays of folders, pens, markers, and backpacks. This fall is going to be extra special, as it marks the return of all students to in-person learning. As we continue moving towards normalcy, it’s a great time to assess your finances to determine how they weathered the pandemic – and the associated economic difficulties – and to plan for future expenditures.
If you’re like most Americans, you spent the last 16 months performing a juggling act. Caring for loved ones, homeschooling your kids, all while possibly working from home. Even if the economy had your stomach in knots, chances are you didn’t have the time to perform a thorough assessment of your personal finances. Here are some tips to help you focus on key areas and be better prepared for the remainder of the year.
Evaluate Your Spending. If the pandemic taught us anything, it’s the value of time spent at home. Now that you’ve learned the joy of cuddling up on the sofa to watch Netflix with the family or sweating off the pounds using home exercise equipment, you may want to rethink those expensive nights out at the movies or that pricey gym subscription. And if your employer has offered a work-from-home or hybrid work arrangement, it’s a good time to recalculate how much you drive your vehicle. Dropping the daily commute means less miles, which may mean a lower insurance premium.
Pay Off Debt. The money you save can be reallocated to improve your overall financial health. Use those extra dollars to pay off high-interest loans or perform home improvements. For most people, their house is their greatest asset, so any money you put into your home is money well-spent. Also, take a look at any automatic payments you’ve set up to determine if you can afford to increase the monthly amount. It will save you hundreds, if not thousands of dollars in the long-run, especially if you have a significant balance, such as a mortgage or student loan.
Once you've paid off those pesky loans, you can more aggressively build up your retirement savings or rainy day fund by contributing the full amount you were previously paying each month toward debt.
Need help? Here are a few tips on how to pay off debt – while also saving money:
- Figure out your budget.
- Reduce your spending.
- Stop using your credit cards and pay with cash.
- Find a payoff method you'll stick with.
- Look into debt consolidation.
- Know when to call it quits and know when to ask for help.
Review Year-End Deadlines. As we head into the fall, it’s a good time to consider the many financial deadlines that fall at the end of December. That way, you can strategically plan your financial allocations so they benefit you down the road. From charitable giving to flexible spending accounts for healthcare to IRA contributions, December presents numerous opportunities to maximize your finances.
Once back to school time arrives, you know the holidays are just around the corner. Rather than waiting until the Christmas crunch, start buying gifts now – or at least begin saving for them. And if you find yourself with extra money in the kitty, there’s no better time to start saving for your kids’ education than when sending them back to class!
Need more help? The Rock Valley Credit Union team is here to help guide you toward setting your financial goals. For more information, schedule a free consultation by reaching out to our Member Contact Center using our chat feature during regular business hours, complete our online form or call (815) 282-0300.