Unity One Credit Union

Live Simply, Reap Savings

Thu, Oct 03, 2019 @ 07:50 AM / by Alyssa Guillory posted in family budget, budgeting, Unity One Credit Union

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Originally posted on the CUNA Financial Resource Center. Written by Monica Steinisch.

There’s been an ongoing movement to simplify and unclutter our lives as a way to ease stress. One piece of advice has the power to both simplify and transform your life: Live beneath your means.

That philosophy is hard for some to adopt. For them, getting a raise doesn’t mean paying off debt or saving it. It means staying on the “make more, spend more” hamster wheel, racking up even more debt. 

Real change only possible with new mindset

In their best-selling book, Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence, co-authors Vicki Robin and Joe Dominguez explore the role of money in our lives and its power over us. Among their observations, the authors note that Americans "project onto money the capacity to fulfill our fantasies, allay our fears, soothe our pain, and send us soaring to the heights.... We buy everything from hope to happiness."

Funny thing—spending as a means to achieve greater fulfillment doesn't seem to work. Numerous surveys conclude that consumers on the higher end of the middle-class earning and spending scale are not any happier than those on the lower end.

Spending less than you earn results in less stuff and less stress.

So why do we keep spending beyond our means? Habit may be partly to blame. A daily routine that includes premium coffee, lunch, and snack purchases could have you spending at least $15 a day without a second thought. To avoid mindless spending, Robin and Dominguez encourage consumers to ask of each expenditure whether it brought "fulfillment, satisfaction, and value in proportion to life energy spent"— the hours of work it takes you to pay for a purchase. When you realize that dinner at an expensive restaurant will cost nine hours of your energy, you start to analyze your spending choices more critically.

Change your mindset that views spending as a reward and saving as deprivation. Instead, realize that overspending can deprive you of the freedom to choose how to live and work, and see living beneath your means as the path to peace of mind and financial independence.

Straightforward steps reduce spending, increase saving

The point of living beneath your means is to avoid debt and save for what is most important to you—homeownership, freedom to spend time with your family, early retirement, etc. Keeping your reward in mind will make adopting these techniques for easier:

  • Make saving automatic. According to David Bach's book The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich, the key to accumulating wealth is to pay yourself first, automatically. That's easy to do: Just set up a funds transfer from the account where your paycheck is deposited to a savings or investment account.
     
  • Track your spending.  Writing down your expenses will help you change automatic routines, like going out to dinner every weekend, and make you aware of your choices.
     
  • Challenge every expense. Compile a list of everything you spend money on. Then look at every essential expense, like housing, groceries, transportation, and determine how you might be able to reduce each one. Then make a list of your nonessential spending (for example, entertainment, meals out, and vacations) and determine which expenditures deliver the greatest bang for your buck. Also, think of ways to save money in those areas. For example, if you love eating out, you could substitute a less-expensive brunch for dinner.
     
  • Avoid temptation. The easiest way to do that is to not make shopping a recreational activity.

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Free Up Cash in 30 Days

Fri, Sep 27, 2019 @ 11:36 AM / by Alyssa Guillory posted in family budget, budgeting, Unity One Credit Union

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Originally posted on the CUNA Financial Resource Center. Written by Laura Varela. 

If you have a tight budget, the thought of finding any extra money can seem unrealistic. But with a few minor tweaks to your spending, it may be easier than you think.

Here are ways to cut down on debt and actually save money in the long run:

  • Consolidate debt — Sometimes the key to paying down debt can be as simple as combining it. One way to consolidate is to get a 0% balance-transfer credit card, transfer your debts to this card, and pay off the balance in full during the promotional period. Another way is to get a fixed-rate debt consolidation loan through your credit union. By consolidating your loans, you could save on interest rates, simplify monthly payments, and start saving money. However, if you’re just going to use it to run up more debt, consolidation isn’t for you.
     
  • Refinance your house and car loans   Refinancing your loans to get a lower interest rate will free up money that can be put toward other bills or put into savings. A credit union loan officer can determine if you qualify for lower rates.
     
  • Revisit home and auto insurance policies —  Check the National Association of Insurance Commissioners website and Insurance Information Institute for advice about picking reputable companies and then compare quotes from different companies. Consider raising deductibles. Ask your insurer about good-student discounts for kids in high school and for college students who live away at school but leave their car at home.
     
  • Go green  Be environmentally conscious and save money while doing so. Programmable thermostats, fluorescent and LED bulbs, and window coverings are options that can help you save energy and money. Go green at the credit union as well by signing up for e-statements and automatic bill payments. Using automatic bill pay will help you avoid late fees and make consistent progress toward your financial goals. Signing up for automatic loan payments may also get you a discount on your interest rate. Ask a credit union loan officer for more information.

With just a little research and a few emails or phone calls, you should be able to free up more cash to pay off debt or put into your savings account.

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Reconciling a Spender-Saver Marriage

Tue, Aug 13, 2019 @ 07:02 AM / by Alyssa Guillory posted in family budget, budgeting, saving money, Unity One Credit Union

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Originally posted on the CUNA Financial Resource Center. Written by Monica Steinisch.

Money ranks high on the list of reasons partners fight or split up. In any marriage, even one where both partners manage money similarly, family finances create conflict at least occasionally. But when one spouse is a saver and the other is a spender, financial disagreements can be frequent, emotional, and divisive.

If you and your partner seem to be polar opposites when it comes to money attitudes, don’t give up hope of a truce. Experts say opposite money personalities actually can complement each other: Savers keep spenders out of the poor house while spenders encourage savers to enjoy themselves now and then. Of course, getting to a balanced approach to the family finances requires compromise and communication.

Understanding your partner's money personality

Your money personality—how you feel about money and the way you manage it—is a product of your upbringing and your life experiences. It was formed over many years and is unlikely to change significantly after you become an adult. Couples who understand this also understand that trying to convert one’s spouse is an exercise in futility. Instead, work on a compromise.

Here are some things counselors say couples should do to reduce conflict and to reach their financial goals.

Communicate

It's important that you talk about your finances. Throughout your discussions, remain open-minded rather than insisting that your partner do things your way. As you talk, make agreements to compromise. An agreement gives you the right to get your partner back on track if he or she veers from what was agreed upon.

Set goals together

It's crucial that couples set common goals. First, make separate wish lists and then, together, rank the items you both feel are most important. Some goals should be at or near the top of every couple's list. These include paying off nonmortgage debt and saving for retirement. Revisit your goals at least annually and make adjustments based on changing priorities and finances. 

Maintain individual accounts

One solution that works for many couples is to have a joint account as well as personal accounts for each partner. Use the joint account to pay household expenses, including mortgage or rent, utilities, insurance, and car and home repairs. If there's money left over, split it into personal no-questions-asked accounts. Use the money from these accounts for individual wish-list goals. For a spender, that might mean paying for a dream vacation. For a saver, it could mean beefing up an IRA (individual retirement account).

Check in with each other at least once a month—more if there have been problems—to re-evaluate and, if financial circumstances warrant, change the discretionary spending amounts. For the joint account, let the person who's good at money handle the bills, but sit down together to go over them regularly.

Get professional help

If you and your spouse reach an impasse, find a couple’s counselor or a financial planner to help you move forward.

For financial planning assistance or money management counseling, contact the professionals at your credit union. You also can find a nonprofit, accredited credit counseling agency through the National Foundation for Credit Counseling.

For couple’s counseling, check with your health plan or employee assistance program (EAP) to see if it covers counseling and to find a qualified, participating professional.

As you narrow the gap between your money management styles, remember that you and your partner are a team. For couples at opposite ends of the spender-saver spectrum, that means each partner has to inch his or her way closer to the center.

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Credit union informs: A family budget

Fri, Sep 13, 2013 @ 02:12 PM / by Erayne Hill posted in credit union, family budget, Unity One Credit Union

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Q: We really need to set up and stick to a budget, but I’m having trouble getting my family on board. What can I do?credit union family

A: It’s not uncommon: She’s a saver, he’s a spendthrift, or vice versa. But no one – even spendthrifts – really doubt the value of saving money for a rainy day. At the same time, no one wants to feel controlled, and no one wants to be the one doing the controlling.

Getting family spending on track takes more than just one person. It needs the support and participation of the whole family. So kudos for trying to get everyone on board.

One idea: Get away from the term “budget.” The word often feels negative, say some experts. Others who have tried to stick with a budget and failed report they felt like the budget controlled them, rather than the other way around. To maximize your chances of success, try these tips:

1.)    Call it a spending plan – and ask your spouse to help you create it. After all, he’s a lot more likely to    adhere to a plan he helped develop than to one he feels was imposed upon him.

2.)    Build in an occasional splurge. Just control it! Make it part of the plan. A movie, a dinner out, a weekend away – whatever it is. Some people blow it once and give up, thinking it’s hopeless. But if you plan for it, you will still stay on track.

3.)    Save for a goal. Some people don’t want to save just to save. But if they know they are saving for something specific and worthwhile, such as a down payment, or to become debt-free, and see progress being made, they are more committed to making it happen.

4.)    Get the kids involved. For example, tell them you’ll take them to their favorite restaurant, or a beach outing, once you reach a certain milestone. Track your progress on the refrigerator door, where the kids can see it. They won’t hesitate to remind you to stay on track!

5.)    Try online tools, like Budget Tracker. But keep in mind that some people just do better with an old-fashioned paper system! Whatever works for you, do it. Don’t get hung up on a particular tool or system. Focus on your goals, not the gadgets!

Above all, remember that perfection is the enemy of the good. A decent spending plan that your family accepts, and one they can start now and stick with, is much better than a perfect spending plan that no one else in your family will accept.

Unity One Credit Union is not only a financial institution but also your partner in life. Our staff is available to assist with you with the simplest of requests. Family communication, especially regarding money, is key to healthy relationships.

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