General Money Management & Personal Savings and Investing #45 PG. 211 #46 PG. 213 http://www.militarymoney.com

Purpose To inform TSMs of some general money management techniques that may assist them in preparing financially for their transition To make the TSM aware of the importance and options available for savings and investments

Some questions to think about…. Are you financially ready to separate? How much do you have saved currently? Do you currently have any debt? Can you live a similar lifestyle if you separate tomorrow?

General Money Management Do you have an Emergency fund? General rule of thumb is 3-6 months of living expenses in a savings account. Actually calculate those expenses Start with $500-$1000 minimum then build up

General Money Management Do you have an active budget? This should be updated and monitored monthly Budget down to the dollar (every dollar has a purpose) Yes, fun is a purpose! But should be budgeted as such Set up a 12 month post separation financial plan at minimum

General Money Management What are you worth? Find your net worth. Assets (what you own) – Liabilities (what you owe) = Net worth (what your worth) You may be surprised to find out what that number actually is!

General Money Management Do you currently have ANY debt? (car loan, phone lease, credit cards, personal loans, mortgage) Have you considered expenses that are currently covered/included? Health insurance, life insurance, etc. Do you have a plan to become debt free?

General Money Management Debt Management programs are offered through Family Support/Service Centers Keep in mind these only help to certain extent It is ultimately the individuals responsibility to put forth the effort by: Sticking to a budget Refraining from over spending Avoiding the use of credit cards Debt management programs is designed to help individuals make debt repayments in a suitable manner (before transition) as well as many other companies who have experience in debt management, but use caution especially when it comes to debt consolidation companies.

Have I saved enough to separate/retire comfortably. What is enough Have I saved enough to separate/retire comfortably? What is enough? Can you maintain your current lifestyle? Personal Savings & Investment

Personal Savings & Investment This is designed to put money into an account for withdrawal when needed. Ex. Your 3-6 month emergency fund or a short term goal Note that savings accounts do not provide much return on interest

Personal Savings & Investment Four common types of investments Bonds: Companies, cities, states, and gov sell bonds to help raise money for their institution Certificate of Deposits (CD): The banks way of making money Stocks: Owning a part of a company (involves risk) Mutual Funds: Pools of money from small investors that is used to buy stocks, bonds or other securities (not just in stocks alone). **Utilize your employer 401K or IRA as your primary investment for retirement

Resources Fleet and Family Support Center Walter Reed Bethesda Bldg 11, Bethesda, MD 20889 Phone: (301) 319-4087 Financial Specialist at the command (free while on active duty) Don’t wait until you have financial trouble to speak with a financial specialist Military One Source: https://www.militaryonesource.mil/financial-legal Provides strategies on consolidating and paying down debt Saving for retirement or college Creating a financial plan Set up financial counseling Financial Specialist: Take advantage of this resource while still on active duty to discuss not only budgeting, but savings and investments and financial planning

Resources Debt Relief Help for Military Service Members: https://www.incharge.org/military-money Financial Management and budget: https://www.mint.com Save and invest for the military: https://www.saveandinvest.org/military/transition Specific information for transitioning service members retiring or separating Credit Report Information: Pull your credit report for free! https://www.annualcreditreport.com https://www.creditkarma.com

My Recommended Resources Institute for Financial Awareness: http://www.ifaonline.org Non profit organization Provides one on one financial counseling as well as offering to teach financial workshops on base Specialize in helping federal employees Local Rep: Mario Taffo & Edgar Johnson Phone: 240-454-7073 Address: 17B Firstfield Rd. Ste 108, Gaithersburg, MD 20878

My Recommended Resources Financial Peace University https://daveramsey.com Dave Ramsey’s 7 baby steps: 1. Save $1000 for your starter emergency fund 2. Pay off all debt (excluding mortgage) 3. Save 3-6 months emergency fund 4. Invest 15% of household income for retirement 5. Save for your child’s college fund 6. Pay off your home early! 7. Build wealth and give!

My Recommended Resources Financial Peace University: https://daveramsey.com 9 week program on money management Find a local group offering the course in your area Fee based $129 (includes all the bells and whistles) Or find a group offering for free in your area! Military edition: If interested in bringing the training to your command. https://daveramsey.com/military

Time for a financial change It’s time to think about your finances differently! Can you imagine having no debt? Can you imagine paying off your home (or future home)? Can you imagine wanting a newer (not brand new!) car and cash flowing it instead of taking on more debt? Can you imagine not reaching for your credit card for unexpected expenses? Can you imagine being a millionaire by retirement? If you answered yes to any of these questions, then it just might be time for a change!

Take away… Don’t just take my word for it or any one persons for that matter! Do the research, utilize your resources and make an informed decision when it comes to your money!

Questions?