Household/Family Financial Management

Steps to Managing Money The indispensable first step to getting the things you want out of life is this: decide what you want. --Ben Stein

Understand your Spending Habits

Develop a Spending Plan

Get ready…..  Get Organized  Find your papers and bills  Tools can help- Record Keeping  Gather Information  Determine how you are spending and saving  May need to track expenses  Make decisions and set priorities

How to Get Started…. Motivation- the first HARD step. Pull out all the papers and begin to sort them. Discard any unnecessary papers (shred) Decide who will take the lead on keeping these papers organized and safe. Schedule a regular time each week to work on the family records.

Where to Keep the Records Home Safe Safe Deposit Box Home File Your Wallet

Personal and Family Records to Keep Names, addresses, and phone numbers of relatives Names, addresses, and phone numbers of advisors Location of valuable records Location of safe deposit box and key Location of CD’s, videos and photos of home inventory. Computer passwords and file names

Personal and Family Records to Keep- - Continued… Location and identification of valuables Insurance Policies Health Records Education Records Employment Records

Property Information to Keep Property Deeds Motor Vehicle Records Equipment warranties, guarantees and manuals Records of home purchase and improvements Burial plots Other

Financial Information to Keep Earning Records Account Records from financial institutions Credit & Debit card information Personal Tax Returns Retirement Benefits Notes and Money Owed

Financial Accounts Current Files  Bank Statements and Cancelled Checks  Bills to be Paid  Credit Card Statements Permanent Files  Credit Records  Pension or Retirement Information  Contracts, Notes and Debts  Investments

Legal Records to Keep Official Certificates  Birth, Marriage, Death, etc. Current Estate Planning Information  Wills, trusts, list of non-titled property Advance directives and Powers of Attorney Social Security Card Passport

How Long to Keep Records Tax Records  IRS says at least 3-6 years  Consider keeping them 7-10 years Bank Statements  7 years Cancelled Checks  1 Year, unless it is for Home Improvement, then keep it for 6 years Credit Card Statements  1 Year, unless it is for a deductible expense, or for a major purchase, keep much longer

Household Inventory Reasons for a household inventory:  Amount of insurance to purchase  Basis for filing insurance claims or tax losses  Evidence of ownership  Value of possessions- net worth statement

Net Worth A snapshot of how much you are worth in dollars and cents Assets – Liabilities = Net worth Assets: Cash, investments, personal assets, use assets Liabilities: Loans on assets, i.e. mortgage or car note and other debts, i.e. credit cards

What does money mean to you? Satisfaction Security SecuritySuccess StatusPower Envy Security Control

People Value Money Differently

Financial Goals Give Us: Organization Direction Decision-making Control Predictions

Emergency Fund

Sources of Household/Personal Income Salary & Tips Social Security Retirement Child Support TANF Loans Tax Refunds Government Assistance Programs

Household Expenses Monthly Expenses  Fixed  Variable Periodic Expenses

DEBT

Financial Goals

Credit Reports One free per year  Equifax  Experian  Transunion  Annualcreditreport.com Check carefully Dispute inaccurate information

Financial Management is a continuous process which requires periodic adjustments