National Black Guide - Money and Savings

Money and Savings

Jennifer Matthews, MBA,provides financial literacy services, training, and mentoring that helps people understand cash flow and better manage cash on hand. Her services include credit restoration and affordable detailed, personalized wealth creation systems for her clients. Ms. Matthews released an ebook entitled 12 Ways To Put Money In Your Pocket Every Month Without A Part-time Job. The ebook is available online at www.12WaysToPutMoneyInYourPocket.com. Ms. Matthews earned an MBA from Johns Hopkins University. Ms. Matthews is the former Maryland/DC State Coordinator for The Delta Challenge Homebuyer Initiative of Delta Sigma Theta Sorority, Inc. and chairs the Economic Development Committee for her local chapter. She is also a guest expert on WUSA9’s Mind Over Money consumer show in Washington, DC.To schedule Ms. Matthews to speak for your company, church, or organization, contact her at 866.732.4270 or info@CreatingFinancialLiteracy.com.

Step 1 To Guaranteed Financial Success

Last month we introduced the purpose of this column and invited readers to send their definitions of financial success and their reasons for wanting to achieve financial success. Thank you to everyone who sent me an email!

This month, we start with a very important question – do you plan to take vacations, or do you just get up and go? If you are like most people, you spend time planning your vacation so that when you get there, the only thing left to do is relax for a wonderful, enjoyable, stress-free week! The follow up question is – do you plan how you spend your money during the other 51 weeks of the year? If you are like most people, the answer is no. However, it is these 51 weeks of the year that sustains your total livelihood…shelter, food, clothing, needs, desires, sprees, impulse purchases, and more! Most people spend more time, energy, and effort planning for vacation than planning for their daily needs and survival.

If you think of your life as a plate sitting on a financial table that you built, how sturdy are the four financial table legs you are living and building your life on? If you go to a store, you would not buy a table with bad, broken, or no legs. Yet, many people are living their lives on tables with broken down financial table legs. Using the information in this column and proper planning, you can strengthen each of the four financial table legs you live your life on. Living your life with strong financial table legs will provide you with Guaranteed Financial Success!

The first financial table leg is financial planning. In the US, on average people spend at least 10% more than they make. This statistic is a key reason why the US also has a negative savings rate, which is leaving no financial reserves to help people through the mortgage crisis, recession, and other financial challenges. Proper financial planning is far more involved than a 401K at work and a savings account a home.

It is never too early to start a financial plan of saving and investing. An example of early financial planning that can be applied to your children or grandchildren is the value of investing $4,000 per year in a Roth IRA at 10% return for only 5 years from age 16 to 21, and then leaving the account untouched without any further deposits. At age 65, the $20,000 invested in the example Roth IRA would be worth more than $2 million! Understand that $4,000 per year is only $77 per week! Perhaps your teenager has a job and you now make them put 50% of their pay into a Roth IRA and you match the difference to the needed $77. You just guaranteed future financial success for that child and taught them valuable lessons about the importance of regular ongoing savings and delayed gratification to let the money grow! A financial planner can help achieve this scenario and many, many others.

Now that I have your attention, you may be telling yourself you are much older than 16, so your window of opportunity is closed – wrong! Meet with several financial planners this month and share your dreams, goals, and questions with each. Many financial planners provide free consultations. Schedule meetings with more than one because you should find someone you can trust who has your best interest in mind. If you are thinking you don’t have any extra money, then this is definitely the time to start financial planning! It is important to plan for good times during bad and bad times during good. Therefore, make your appointments today! Use referrals, the telephone book, and the Internet to find people in your area to meet with.

Next month, we will explore the second financial table leg: tax planning. Remember, you embarked on a journey to financial success. Part of last month’s article was dedicated to mindset and commitment. Guaranteed financial success involves taking massive and immediate action on everything presented in these columns!

GFS Money Minute: Open two savings accounts and have $20 from every paycheck automatically transferred into each account. The $80 per month saved is about $2.70 per day, or about the cost of a cup of coffee. After 12 months, each account will have more than $480. Use one account for holiday shopping and the other for vacations and major social activities. Some online bank accounts offer approximately 4% interest and free direct transfers.

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How To Guarantee Financial Success


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	Money and Savings Jennifer Matthews, MBA,provides financial literacy services, training, and mentoring that helps people understand cash flow and better manage cash on hand. Her services include credit restoration and affordable detailed, personalized wealth creation systems for her clients. Ms. Matthews released an ebook entitled 12 Ways To Put Money In Your Pocket Every Month Without A Part-time Job. The ebook is available online at www.12WaysToPutMoneyInYourPocket.com. Ms. Matthews earned an MBA from Johns Hopkins University. Ms. Matthews is the former Maryland/DC State Coordinator for The Delta Challenge Homebuyer Initiative of Delta Sigma Theta Sorority, Inc. and chairs the Economic Development Committee for her local chapter. She is also a guest expert on WUSA9’s Mind Over Money consumer show in Washington, DC.To schedule Ms. Matthews to speak for your company, church, or organization, contact her at 866.732.4270 or info@CreatingFinancialLiteracy.com. Step 1 To Guaranteed Financial Success Last month we introduced the purpose of this column and invited readers to send their definitions of financial success and their reasons for wanting to achieve financial success. Thank you to everyone who sent me an email! This month, we start with a very important question – do you plan to take vacations, or do you just get up and go? If you are like most people, you spend time planning your vacation so that when you get there, the only thing left to do is relax for a wonderful, enjoyable, stress-free week! The follow up question is – do you plan how you spend your money during the other 51 weeks of the year? If you are like most people, the answer is no. However, it is these 51 weeks of the year that sustains your total livelihood…shelter, food, clothing, needs, desires, sprees, impulse purchases, and more! Most people spend more time, energy, and effort planning for vacation than planning for their daily needs and survival. If you think of your life as a plate sitting on a financial table that you built, how sturdy are the four financial table legs you are living and building your life on? If you go to a store, you would not buy a table with bad, broken, or no legs. Yet, many people are living their lives on tables with broken down financial table legs. Using the information in this column and proper planning, you can strengthen each of the four financial table legs you live your life on. Living your life with strong financial table legs will provide you with Guaranteed Financial Success! The first financial table leg is financial planning. In the US, on average people spend at least 10% more than they make. This statistic is a key reason why the US also has a negative savings rate, which is leaving no financial reserves to help people through the mortgage crisis, recession, and other financial challenges. Proper financial planning is far more involved than a 401K at work and a savings account a home. It is never too early to start a financial plan of saving and investing. An example of early financial planning that can be applied to your children or grandchildren is the value of investing $4,000 per year in a Roth IRA at 10% return for only 5 years from age 16 to 21, and then leaving the account untouched without any further deposits. At age 65, the $20,000 invested in the example Roth IRA would be worth more than $2 million! Understand that $4,000 per year is only $77 per week! Perhaps your teenager has a job and you now make them put 50% of their pay into a Roth IRA and you match the difference to the needed $77. You just guaranteed future financial success for that child and taught them valuable lessons about the importance of regular ongoing savings and delayed gratification to let the money grow! A financial planner can help achieve this scenario and many, many others. Now that I have your attention, you may be telling yourself you are much older than 16, so your window of opportunity is closed – wrong! Meet with several financial planners this month and share your dreams, goals, and questions with each. Many financial planners provide free consultations. Schedule meetings with more than one because you should find someone you can trust who has your best interest in mind. If you are thinking you don’t have any extra money, then this is definitely the time to start financial planning! It is important to plan for good times during bad and bad times during good. Therefore, make your appointments today! Use referrals, the telephone book, and the Internet to find people in your area to meet with. Next month, we will explore the second financial table leg: tax planning. Remember, you embarked on a journey to financial success. Part of last month’s article was dedicated to mindset and commitment. Guaranteed financial success involves taking massive and immediate action on everything presented in these columns! GFS Money Minute: Open two savings accounts and have $20 from every paycheck automatically transferred into each account. The $80 per month saved is about $2.70 per day, or about the cost of a cup of coffee. After 12 months, each account will have more than $480. Use one account for holiday shopping and the other for vacations and major social activities. Some online bank accounts offer approximately 4% interest and free direct transfers. Previous Articles How To Guarantee Financial Success © 2008 Creating Financial Literacy, LLC All rights reserved. Reprints permissible with “About the Author” box kept untouched with the article.
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