Goal Setting and Financial Planning (for everyone)

This program is provided through a grant from the Financial Industry Regulatory Authority (FINRA) Investor Education Foundation and the American Library Association (ALA). The grant is distributed as part of the smartinvesting@your library® initiative, an ALA program. This project is in its sixth year of educational partnership with libraries across Colorado and the country. Marsha Yelick CFA(retired) Financial Programs Consultant myelick@estesvalleylibrary.org 970-586-8116 Ext 831

Earn more than you spend (and save the rest). Live well with what you have. It’s never too late. Simplicity! Major themes du Jour

Influences on your financial SELF! (Financial Psychology 101) The years in which you grew up The family in which you were raised The bumps in the road you have experienced The age cycle in which you exist (20’s, 30’s, etc.) The habits you have integrated Financial Psychology 101

What is money? (growth is GOOD!?) (view of the city) MONEY is... ...a means of exchange (value) (view from the street) ...an assignment of prestige (view of the neighborhood) What is money? ...measurement of growth (growth is GOOD!?) (view of the city) ...hours of life you choose to exchange (view from a helicopter)

The 3 DREADED financial MUST-DOs BALANCE SHEET INCOME STATEMENT GOAL SETTING Three financial tasks

The Balance Sheet FIRST TASK, the NET WORTH STATEMENT… What you own? What you owe? _______________ = Your NET WORTH The Balance Sheet

Plan for the future…(goals) Create a safety net Plan for the future…(goals) New business or career change Trip of a lifetime College for children New car or house RETIREMENT (a MUST!) 3. Organize your stuff Uses for NET WORTH

(Do you really need one?) SECOND TASK, the BUDGET NOW CALLED... THE SPENDING PLAN (Do you really need one?) The Spending Plan

The Spending Plan (The Income Statement/Cash Flow/Budget) What do make (income)? Where does it go (spending)? _________________ Your surplus (Surplus? You’re kidding) Budget

Record every $$$ 4. Adjust to your priorities THE GOAL – DISCOVER where the money goes SIMPLE STEPS TO BUDGETING 1. Identify income 2. Track expenses 3.Compare budget to actual 4. Adjust to your priorities Record every $$$

Computer Use If you are so inclined… Use a spreadsheet Paper and PENCIL Template from EXCEL - Family or Single Create your own spreadsheet Use a computer program or app QUICKEN $50 - $90 MINT– free You Need a Budget 4 (YNAB) $60 (free trial) Mvelopes – free to costly Etc. ....... Computer Use

Tracking expenses Not all things are easy to track… Some suggestions for the hard stuff… Save receipts Categorize receipts Record at least once a week Give yourself some “walking around $” People who pay with cash spend 30% less! Tracking expenses

How many shoes do you need??? Enough?

What truly gives you pleasure? MORE +++ --- LESS Fulfillment?

Life energy spent? How much “LIFE” does something cost? Six hours = $150 One ticket to the Broncos @ $150 (plus gas, parking, treats...) Life energy spent?

Goal setting FINAL TASK – SET GOALS DECIDE WHAT YOU WANT TODAY (short term – 1-2 years), TOMORROW (mid-term – 3-10 years) THE FUTURE (long term – 10+ years) Goal setting

Bring out-there-in-tomorrow-land into towhat-do-I-need-to-do-today You MUST save for RETIREMENT! Bring out-there-in-tomorrow-land into towhat-do-I-need-to-do-today Use online calculators to compute what you need to save The biggest Goal (It’s not rocket science)

Save for your goals AND START SAVING. Find the money (in your budget)…… AND START SAVING. Save for your goals

YOUR ASSIGNMENT... Financial tasks Create your balance sheet (net worth) Create a budget 3 Determine your goals Find the money in your budget to fund the goals (and pay yourself first through savings) Live simply, live well, rest well. Financial tasks

(AND COME TO NEXT CLASS!) Thanks for attending! BE MONEY SMART FOR LIFE (AND COME TO NEXT CLASS!)