With the new year approaching, now is the perfect time to make a resolution to set your help your budget. These five free tools from FCFCU will help you optimize your budget and savings in 2022.
1| Lower Your Credit Card Payoff Date with our Credit Card Down Payment Calculator
Paying off your credit card balance isn't the easiest way to start the year, but it should be the first step to improving your financial wellness. Even a card with a low-interest rate can quickly build debt.
With $2000 balance on your credit card and 10% interest rate, it will take you over 12 years to pay it off with a 2% minimum payment. In the end, you'll have paid an additional $1000 in interest, and will have had a $40 recurring payment to worry about for over a decade. But what happens when we increase our monthly payment?
By paying 10% of your monthly balance, you'll have your credit card paid off in just over one year's time. For many, a $40 a month payment is easier to manage than $200, but the long-term benefits greatly outweigh the short-term.
Wonder how we calculated our credit card balance payoff?
The free credit card paydown calculator on FCFCU Wellness lets you compare and contrast proven credit card payoff strategies to find the fastest and most efficient ways to pay off your credit card.
2| Set A Realistic Budget with our Budget Tracker
The past two years have changed American spending and saving habits. Studies have shown Americans who don't track and budget their spending tend to owe more on their credit cards than those who have a budgeting plan. Little changes to your budget could end up making a huge impact so let’s start there.
- If you spend $1.50 a day on coffee, that's $548 a year.
- If you spend $20 every week on fast food, that's $1,040 a year.
- If you spend $6.20 a day on cigarettes, that's $2,263 a year.
- If you spend $40 a month on streaming services, that's $480 a year
There are plenty of ways to save money when there's not much to save before you begin budgeting for the year.
To create your monthly budget, you could use your bills and bank statements and jot down your expenses on pen and paper. But there's an easier and more effective way with the Budgeting Tool from FCFCU Wellness. The budgeting tool will save a personal record of your budget status, and you can go back and adjust any time. Inside, you can calculate your monthly income, savings and goals, investments, and any monthly expenses (credit card debt, insurance, etc.) you may face each month.
Budgeting not for you? Even the act of routinely monitoring your spending is a key to developing healthy money habits.
3| Use Student Loan Snapshot to get a Picture of your Payments
Federal Loans are back in full force, and private loans never left. You may have forgotten what it's like to have a federal student loan payment due each month or maybe you're trying to help someone keep track of all their loans. With the Student Loan Snapshot Tool, you can get a clearer picture of your student loans. See how much you owe, and find which repayment plan is best for you.
Getting ready to pay off multiple Federal Loans? Utilize the Debt Avalanche or Debt Snowball techniques when paying off your loan.
The Debt Avalanche
This technique involves paying your loan with the highest interest first, and paying the minimum on your other loans each month. This will help eliminate the higher interest that stems from your highest interest loan.
The Debt Snowball
The debt snowball is the opposite of the avalanche, this time focusing on paying the smallest loans first. While the debt avalanche will save you money in the long run, the psychological effect off paying off loans and “checking off the box” could lead to more satisfaction when utilizing the snowball. Beside the two techniques, and repayment plans, there is no secret technique to paying off your student lines besides proper budgeting and spending your money appropriately.
4| An All in One Mobile Banking Platform
Never miss a payment on your bills, one time or reoccurring with Bill Pay in the FCFCU Digital Banking. That's not all you can do with your state-of-the-art online banking platform. You can set up the rest of your year with smart money allocations and savings.
5| Learn about Your Money Personality and meet with Certified Financial Councilors from FCFCU
Still having a hard time understanding your own personal spending habits and budgeting techniques? Consider finding out your Money Personality, to help you better understand you. Managing your finances is more than just money in the bank.
It involves setting goals, evaluating choices, and high stakes! Like most things in life, your unique personality and behaviors are an important piece. This analysis will help you better understand the "why" behind your financial decision-making, while recommending positive changes.
Please remember, your financial personality and behaviors depend on complex factors and may change over time. As such, this analysis is to be taken as suggestion only. For individualized advice, consider scheduling a free consultation with one of our Certified Credit Union Financial Councilors. These are the friendly faces you've come to know at First Commonwealth, who have a personal investment to empower your pursuit of financial happiness. You can schedule your conversation today to kickstart your new year!
By Douglas Snellen, CCUFC