1. First at work
Saving & budgeting

2. American Family Financial Statistics
If you think your personal finances are in need of an overhaul, you aren’t alone. According to the US Census, the average American household is falling short of their savings goals. In today’s session, we hope to give you some basic tools to help you establish and achieve your personal financial goals.
Average savings balance: $3,800
Percent of working Americans who are not saving for retirement: 40%
Percent of Americans with no savings at all: 25%
Average amount saved for retirement: $35,000
Average household debt: $117,951
Percent of Americans who do not have an emergency fund prepared: 62%
Source: Federal Reserve, US Census Bureau, Internal Revenue Service; 7/26/2012

3. Meet the Taylors
Follow our fictional family as they take steps to put themselves in financial balance.
Mr. Taylor works as a graphic designer and earns $65,000 per year. Mrs. Taylor works as a teacher and earns $35,000 per year. Their goals are to balance their budget, pay off debt, and grow their savings.

4. Putting Yourself in Balance
Balance “wants” vs. “needs” to determine where you are spending too much ― or not enough.
Income figured as household
1. Breaking it down
Monthly Net Income:
You should spend
50% Needs
30% Wants
20% Savings
2. Where does it really go?

5. Putting Yourself in Balance
Balance “wants” vs. “needs” to determine where you are spending too much ― or not enough.
Net Income = Gross Income – Taxes
*An average person will pay approximately 30% in taxes
$100,000 x .30 = $30,000 out for taxes
$70,000/12 months = $5,833 per month
2. Where does it really go?

6. Putting Yourself in Balance
Balance “wants” vs. “needs” to determine where you are spending too much ― or not enough.
Income figured as household
1. Breaking it down
Monthly Net Income:
$5,833
You should spend
50% Needs
30% Wants
20% Savings
2. Where does it really go?

7. Putting Yourself in Balance
Balance “wants” vs. “needs” to determine where you are spending too much ― or not enough.
Income figured as household
1. Breaking it down
Monthly Net Income:
$5,833
You should spend
50% Needs
$2,916.50
30% Wants
$1,749.90
20% Savings
$1,166.60
2. Where does it really go?

8. Putting Yourself in Balance
Needs
Things you are contractually obligated to pay or that you depend on for survival.
$1100
housing/taxes/insurance
$150
auto/life/other Insurance
$225
car payment
$40
out of pocket medical
$2,915
$200
gas, parking, transit
$600
child care/child support $0
tuition/school fees
$200
utilities/phone
$300
groceries
$100
loan/credit card payments $0
other

9. Putting Yourself in Balance
Wants
Be sure to make room for fun! Here you are aiming for 30% of your income.
$100
clothes
vacations
$200
dining out
$150
entertainment
$75
recreation/gym
$300
internet/cell phone/cable tv
$175
misc cash spending
household items
personal care
$250
other
$2,915
$1,750

10. That’s about 300 private islands – with money left over for a latte.
In 2011, Americans spent $10.7 billion on their wants
That’s about 300 private islands – with money left over for a latte.
Pretzels
$550 million
(Reuters)
Pet Halloween Costumes $310 million
(National Retail Federation/ American Pet Product Association)
Chocolate $16 billion
(we eat 2.8 billion pounds of it!) (IBIS)
Golf Balls $500 million
(Forbes)
Girl Scout Cookies $800 million (Girl Scouts of America)
What items are you spending your money on without including it in your budget?

11. Putting Yourself in Balance
Savings
Be sure to save for your future - - and also use this to pay down consumer debt!
$582
retirement saving
$168
long term savings
$125
college savings
$50
short term savings
$100
extra mortgage payments
extra credit card payments $0
other extra payments
$40
child savings
$2,915
$1,165
$1,750

12. The Elements of Saving Keep your hard earned cash!
Simple savings tips to help you stretch your dollar.

13. The Elements of Saving Keep your hard earned cash! shop with a list
Simple savings tips to help you stretch your dollar.
shop with a list
coupon, coupon, coupon
pack your lunch
buy reliable, not cheap
use daily deal sites
buy in bulk…sometimes

14. American Express Spending & Saving Tracker.
The Elements of Saving
Keep your hard earned cash!
Simple savings tips to help you stretch your dollar.
A top resolution in the U.S. is to save more money, The following figures are the consumer savings goals per year:
2010: $14,000
2011: $2,600
2012: $7,633
2013: $10,893
Though savings goals are currently on the rise, we are still a far cry from 2010 goals.
Why?
American Express Spending & Saving Tracker.

15. The Elements of Saving Save smart!
Be strategic in your savings to maximize results.

16. The Elements of Saving Save smart! set a realistic goal
Be strategic in your savings to maximize results.
set a realistic goal
pay yourself first
start now
start small
use separate accounts

17. The Elements of Saving Save smart! Retirement
Retirement - short term, and long term… both are important. But how much should you put in each?
Retirement
myth: save at least 10% of your income for retirement.
truth: depending when you START saving, that may not be the case:
% - 15%
% - 25%
% - 35%
45+ see an advisor

18. The Elements of Saving How much…and where? Long term savings
Retirement - short term, and long term… both are important. But how much should you put in each?
Long term savings
Also known as your emergency savings, these funds should cover the ‘what ifs’ in life.
Why?
-If you were to lose your job, it would take approximately 3-6 months to find a similar job/pay.
-If you were to become disabled, it would take about 90 days for disability pay to kick in.
How would you manage during this time without an emergency savings account established?
Most experts agree that you should have a minimum of 3 – 6 months of living expenses in your emergency savings fund.
Why?

19. The Elements of Saving How much…and where? Long term savings
Retirement - short term, and long term… both are important. But how much should you put in each?
Long term savings
Also known as your emergency savings, these funds should cover the ‘what ifs’ in life.
disability
medical expense
unemployment
house or auto repairs
insurance deductibles
Why?
-If you were to lose your job, it would take approximately 3-6 months to find a similar job/pay.
-If you were to become disabled, it would take about 90 days for disability pay to kick in.
How would you manage during this time without an emergency savings account established?
Most experts agree that you should have a minimum of 3 – 6 months of living expenses in your emergency savings fund.
Why?

20. The Elements of Saving How much…and where? Short term savings
Retirement - short term, and long term… both are important. But how much should you put in each?
Short term savings
Good news – you get to spend this money and within the next year!

21. The Elements of Saving How much…and where? Short term savings
Retirement - short term, and long term… both are important. But how much should you put in each?
Short term savings
Good news – you get to spend this money and within the next year!
home remodel
new auto purchase
large household purchase
vacation
holiday shopping
weddings

22. Holiday Shopping Statistics
Guess what? History tells us that holidays come at the same time every year! In 2011, Americans spent over $52 Billion between November 1st and December 16th on holiday gifts. However, a vast majority of us do not figure holiday shopping into our annual budget. How do you think this gets paid for each year?
Source: Comscore, Shoporg, Technet, American Research Group; 9/19/2012

23. The Elements of Saving Debt Drop Minimum payments
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Minimum payments
$800 Major Credit Card $20
$1,450 Store Credit Card $80
$7,400 Car Loan $230
$13,400 Student Loan $154
$22,000 Home Equity Line $340

24. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $220
$1,450 Store Credit Card $80
$7,400 Car Loan $230
$13,400 Student Loan $154
$22,000 Home Equity Line $340
Apply the $200 from savings towards your first debt listed

25. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $220
$1,450 Store Credit Card $300
$7,400 Car Loan $230
$13,400 Student Loan $154
$22,000 Home Equity Line $340
Once your first debt listed is paid off in full, you DROP that payment you were making on it to the next debt in line.
You go from making a $80 store credit card payment to making a $300 store credit card payment
You continue this concept until you are on your last debt listed. By this time you are applying all of your money to you largest and last debt!

26. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $200
$1,450 Store Credit Card $300
$7,400 Car Loan $530
$13,400 Student Loan $154
$22,000 Home Equity Line $340

27. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $200
$1,450 Store Credit Card $300
$7,400 Car Loan $530
$13,400 Student Loan $684
$22,000 Home Equity Line $340

28. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $200
$1,450 Store Credit Card $300
$7,400 Car Loan $530
$13,400 Student Loan $684
$22,000 Home Equity Line $1,024

29. Apply $200 from savings toward debt
The Elements of Saving
Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Apply $200 from savings toward debt
$800 Major Credit Card $200
$1,450 Store Credit Card $300
$7,400 Car Loan $530
$13,400 Student Loan $684
$22,000 Home Equity Line $1,024

30. The Elements of Saving Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.

31. The Elements of Saving Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
No Drop
Total Paid: $54,258.13
Length of Pay: 8 Yr 7 Mo
Emphasize on the difference between paying your debt off with the debt drop and without.

32. The Elements of Saving Debt Drop
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Total Paid: $50,781.48
Drop
Length of Pay: 4 Yr 1 Mo
Emphasize on the difference between paying your debt off with the debt drop and without.

33. Total Saved $3,476.65 in interest 4 years 6 months of payments
The Elements of Saving
Debt rolldown
Paying off accounts with the highest interest rates first isn’t always the fastest way out of debt.
Total Saved $3, in interest 4 years 6 months of payments
That’s $55,296 in saved payments!

34. The Elements of Saving Ways to save Savings Accounts Money Markets
There are just as many ways to save as there are reasons to save. Find what is best for your buck.
Savings Accounts
Money Markets
Certificates of Deposit
Investments
Online Savings Accounts

35. The Elements of Saving
Interest compounding is the “greatest mathematical discovery of all time.”
- Albert Einstein

36. The Elements of Saving Compounding interest
Banks want your money and are willing to pay you for it. Make sure you are interest savvy to get more bang for your buck.
Annual Percentage Yield (APY): the annual rate of return on an investment after compounding
compounded interest essentially pays you interest on your interest
always compare APY over Rate when shopping for savings vehicles
the more frequent the compounding, the more money you make
the longer your investment sits, the more you earn

37. 5 Years | Contributions: $3,000 | Total Balance: $3,315
The Elements of Saving
Compounding interest
With the power of compounding interest, it's easy to earn more in interest than you take from your own pocket. All you need is a little bit of patience. With a $50 a month contribution and an assumed 5% savings rate, let’s watch how your money grows.
These slides are built to show the impact of compounding interest over time.
5 Years | Contributions: $3,000 | Total Balance: $3,315

38. 15 Years | Contributions: $9,000 | Total Balance: $12,947.14
The Elements of Saving
Compounding interest
With the power of compounding interest, it's easy to earn more in interest than you take from your own pocket. All you need is a little bit of patience. With a $50 a month contribution and an assumed 5% savings rate, let’s watch how your money grows.
These slides are built to show the impact of compounding interest over time.
15 Years | Contributions: $9,000 | Total Balance: $12,947.14

39. The Elements of Saving Compounding interest
With the power of compounding interest, it's easy to earn more in interest than you take from your own pocket. All you need is a little bit of patience. With a $50 a month contribution and an assumed 5% savings rate, let’s watch how your money grows.
These slides are built to show the impact of compounding interest over time.
With compounding interest, you’ve doubled your money in 30 years!
30 Years | Contributions: $18,000 | Total Balance: $39, That’s almost $22,000 in free money!

40. Next Steps write it all down cut back on ‘wants’ set savings goals
Taking action
Making a plan is the most important part of balancing your personal budget.
write it all down
cut back on ‘wants’
set savings goals
find quick savings wins
pay down debt
make interest work for you

41. Questions? Thank you for your time! Consider First National Bank
Personal Checking & Savings Accounts
Personal Loans
Home Mortgage Loans
Business Banking needs
Wealth Management
College Savings

42. Resources