Tag Archives: Financial Advice

How to Get Back on Track If You’re Drowning in Debt

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bigstock-Businessman-Run-Away-From-Debt-103353212Getting out of debt is much harder than getting into it. But you can do it — and along the way, you’ll rid yourself of a lot of stress.

Countless people find themselves drowning in debt simply because they can’t control their spending. If this sounds familiar, try tracking everything you buy for a month, including all those “little” items that cost just a few dollars. Once you see how those purchases add up, you’ll realize how important it is to lay out a budget and stick to it.

Understanding how much you actually spend is a good first step, but that alone won’t get you out of debt. The following strategies for managing different types of expenses — and bringing in some extra income — can you help you reach a happy, debt-free future.

Control your credit card usage. If credit card debt is the problem, take these steps right away:

  • Cut up your cards: Save one card for use in emergency situations. Cut up all the others, and throw away the pieces.
  • Pay with cash: Only pay cash for purchases such as groceries, clothing, and gas.
  • Attack high-interest debt first: Pay off the credit card with the highest interest rate first. Once this card is paid off, apply what you were paying on it to the card with the next highest rate.
  • Negotiate a lower rate: Negotiate your interest rate with your credit card companies. Your issuer will usually work with you if you say you’re going to transfer the balance to another card with a lower rate.

Cut some recurring expenses. Most people have recurring monthly expenses that can be eliminated, including:

  • Excess phone service: If you have a mobile and a landline, you probably don’t need both. Pick one and stop paying for the other.
  • Satellite/cable television: Consider disconnecting satellite or cable service and replacing it with a streaming service, such as Netflix or Hulu. You can get entertainment at a fraction of the monthly cost.

Keep an eye on your indulgences. We all have little indulgences we like to spend money on here and there, but we often don’t realize how much they add up.

  • Specialty coffee: Stopping by Starbucks on your way to work every morning is certainly a luxury you enjoy, but you could save $25 or more a week by making your own coffee at home.
  • Fast food lunches: If you work outside your home, chances are you buy lunch out at least a couple of days per week. These costs mount quickly. Even if you spend only $40 per month eating lunch out, that’s $40 that could go to your savings account or toward a credit card payment.

Bring in extra income. When you lose control of your finances, getting out of debt requires serious action.

  • Take a second job: No one wants to work 16 hours per day, but if that’s what it takes for your family to thrive financially, then it must be done — at least temporarily. It may be that working an additional, part-time job for just 20 hours or less per week is all that’s necessary to help you out financially.
  • Sell things you don’t use: Many of us keep things we no longer need in the basement or storage shed. Sell any item you haven’t used within the last year online or have a garage sale.
  • Sell your (extra) car: If you’re a two or three-car household, chances are you could make do with one less car. Consider selling one if it isn’t a necessity.

Reduce debt — and stress.

It requires work and a commitment to doing what it takes to reduce your expenses-to-income ratio. Once you make that commitment, you’ll find that your bank account grows and your stress level decreases.

12 Money Rules to Live By

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bigstock-Piggy-bank-on-money-concept-fo-118171091One-size-fits-all financial advice isn’t supposed to work. We’re all as unique as snowflakes, so the financial rules that guide us should be molded to our individual situations.

Except it turns out that rules of thumb can be really helpful.

A study of West Point cadets, for example, found teaching rules of thumb was at least as effective as standard personal finance training in increasing students’ knowledge and confidence as well as their willingness to take financial risks. Researchers found money rules of thumb actually were more effective than teaching accounting principles to small-business owners in the Dominican Republic.

Besides, we all have busy lives — sometimes, we just want an answer. If you’re tired of the “on the one hand this, on the other hand that” approach to financial advice, check out these guidelines that have been collected over the years. Perhaps you’ll find some one-size-fits-all advice that suits you.

1. Car buying: Buy used and drive it for 10 years

New cars are lovely, but they’re expensive and lose an astonishing amount of value in their first two years. Let someone else pay for that depreciation and take advantage of the fact that today’s better-built cars can run well for at least a decade if properly maintained. You can save hundreds of thousands of dollars over your driving lifetime this way.

2. Car loans: If you have to borrow, use the 20/4/10 rule

Ideally, you wouldn’t borrow money to buy an asset that loses value, but you may not always be able to pay cash for a car. If you can’t, protect yourself from overspending by putting 20% down, limiting the loan to four years and capping your monthly payment at no more than 10% of your gross income. A big down payment keeps you from being “underwater,” or owing more on the car than it’s worth, as soon as you drive off the lot. Limiting the length of the loan helps you build equity faster and reduces the overall interest you pay. Finally, capping the size of the payments prevents your car from eating your budget.

3. Save for college

Retirement saving is more important, but get in the habit of putting at least $25 a month aside for college soon as your child is born. Your kids can always get student loans, but as you’ve probably heard, no one will lend you money for retirement. Your children will not thank you if the price for their education is your having to move in with them because you’re 70 and broke. The good news is that even small contributions to a 529 college savings plan can add up over time. “Starting early can mean the difference between choosing the college that is right for your child as opposed to the one that offers the best financial aid package,” says Joe Hurley, founder of SavingForCollege.com.

Our Investment and Retirement Center can help you get your colleges savings in order with a 529 College Savings Plan – give us a call at 732.312.1500, email mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, or stop into any branch!**

4. Credit cards

If you carry a balance, look for a low-rate card to help you pay off your debt. If you pay in full each month (as you should), find a rewards card that returns at least 1.5% of what you spend. Don’t mess with rewards cards if you’re dragging around credit card debt. Focus on paying it off fast with a low-rate card. If you pay in full, though, you should regularly review your rewards programs to make sure you’re getting enough value from them. The programs can change, as can your spending and the way you use rewards. “Even if you don’t want to ‘play the game’ and manage a complicated wallet, there’s no excuse for earning less than 1.5% back for all of your purchases,” says NerdWallet credit card expert Sean McQuay.

Our Visa Platinum Cash Plus Credit Card is the perfect addition to your wallet, with no annual fee, a low rate, and rewards!*

5. Emergency savings

You need to be able to get your hands on cash or credit equal to three months’ worth of expenses. The classic emergency fund advice — that you need three to six months of expenses saved — is great, but it can take years to save that much and you have other priorities that are more important (see “retirement,” below). While you build up your cash stash, make sure you have a Plan B. That could be money in a Roth IRA (you can pull out your contributions at any time without paying taxes or penalties), space on your credit cards or an unused home equity line of credit.

6. Insurance

Cover yourself for catastrophic expenses, not the stuff you can pay out of pocket. Insurance should protect you against the big things— unexpected expenses that could wipe you out financially, such as your home burning down or a car accident that triggers a lawsuit. You want high limits on your policies, but high deductibles, too. “Making a series of small claims doesn’t make financial sense in the long run. You may gain some small insurance payments, but you risk a rate increase that could more than cancel out your gains,” says NerdWallet insurance expert Amy Danise.

7. Mortgage amount

If you can’t afford the payment on a 30-year, fixed-rate mortgage, you can’t afford the house. You may be able to save money by using another kind of mortgage, such as a hybrid loan that offers a lower initial rate. But if you’re using an alternative loan because that’s the only way you can buy the home you want, you may have set your sights too high. A budget-busting mortgage puts you at risk of spiraling into ever-deeper debt, especially when you add in all the other costs of homeownership.

8. Mortgage rates

Fix the rate for at least as long as you plan to be in the home. Plans can change, obviously, but you don’t want a big payment jump to force you out of a home you hoped to live in for years to come. If you’re pretty sure you’ll be moving in five years, a five-year hybrid could be a good option. If you think you may stay for 10 years or more, though, consider opting for the certainty of a 30-year fixed rate.

First Financial offers great low-rate Mortgages to get you into your dream home – check out our current options on our website at www.firstffcu.com!

9. Mortgage prepayments

You have better things to do with your money than prepay a low-rate, potentially tax-deductible mortgage. Shaving years off your mortgage and saving money on interest sounds great. But before you consider making extra payments to reduce your mortgage principal, make sure more important priorities are covered. You should be saving enough for retirement, for one thing, and have paid off all other debt, since most other loans have higher rates and the interest isn’t deductible. It would be smart to have that emergency fund built up as well and to be adequately insured. If you’ve covered all of those bases and still want to pay down your mortgage, have at it.

10. Retirement: Save 15%

If you got a late start or want to retire early, you may need to save more. Run the numbers on your retirement plan. For most people, 15% including any company match is a good place to start. Even if you can’t save as much as you should, start somewhere and kick up your savings rate regularly. Retirement should be your top financial priority, by the way. You can’t get back lost company matches, lost tax breaks and the lost years where your money isn’t earning tax-deferred returns.

11. Retirement, Part II

Leave retirement money for retirement. When your retirement fund is small, you may feel like spending it doesn’t really matter. It does. Taxes and penalties will cost you at least 25% and likely more of what you withdraw. Plus, every $1 you take out costs you $10 to $20 in lost future retirement income. Once your retirement fund is larger, it may be easy to convince yourself there are good reasons to borrow or withdraw the money. There really aren’t. Leave the money alone so it’s there for you when you need it.

Our Investment and Retirement Center can help you with your retirement planning – give us a call at 732.312.1500, mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, or stop into any branch!**

12. Student loans

Your total borrowing shouldn’t exceed what you expect to make your first year out of school. At today’s interest rates, this will ensure that you can pay off what you owe within 10 years while keeping payments below 10% of your income, which is considered an affordable repayment rate, says financial aid expert Mark Kantrowitz, author of “Twisdoms about Paying for College.” What if you didn’t limit your borrowing and are now struggling? You have options. “If you have an overwhelming federal loan balance, income-driven repayment plans are there for you,” says NerdWallet student loan expert Brianna McGurran. “It’s tempting to want to hide from your debt or be ashamed of it, but you’re better off looking into the repayment options that are out there. You’ll see there are ways to find relief.”

*APR varies up to 18% for purchases, when you open your account based on your credit worthiness. The APR is 18% APR for balance transfers and cash advances. APRs will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fee. Other fees that apply: Cash advance fee of $10 or 3% of the total cash advance amount—whichever is greater (no maximum), Balance transfer fee of $10 or 3% of the balance—whichever is greater (no maximum), Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa® Credit Card and is available to anyone who lives, works, worships, or attends school in Monmouth or Ocean Counties.

**Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. First Financial Federal Credit Union (FFFCU) and First Financial Investment & Retirement Center are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using First Financial Investment & Retirement Center, and may also be employees of FFFCU. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of FFFCU or First Financial Investment & Retirement Center.

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Top 5 Financial Regrets…and How to Avoid (or Move Past) Them

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When was the last time you heard the phrase “no regrets”? Maybe it was accompanied by the acronym “YOLO,” or you saw it written in script on a sappy motivational poster.

It’s time to get real. Most of us do have regrets — especially when it comes to our finances.

According to a new survey from Bankrate.com, 75 percent of Americans say they have financial regrets. Apparently, we’re the most remorseful when it comes to saving — especially for retirement, and after that, emergency expenses. The site reported 42 million Americans regret not starting their retirement saving earlier, and that those concerns increased with age. Millennials said they regretted excessive student loan debt most, with 24 percent of respondents under 30 listing it as their chief financial regret. Other top concerns included taking on too much credit card debt and not saving enough for a child’s education.

There are no do-overs in finances, unfortunately, but you can do better. Here are the top 5 financial regrets with suggestions for how to turn the situation around.

1. Retirement Savings

If you’re feeling behind, you need to get on the automatic bandwagon. Saving by automatic contribution (a 401(k) or similar plan) works because you make a good decision one time and get to dine out on it for years.

If you’re starting late, you need to aim to stash away 15 percent of your income (including matching contributions). Not there yet? Ratchet your contributions up 2 percent a year until you hit that mark. Also look into catch-up contributions that allow you to contribute an extra $1,000 to an IRA or $6,000 to a 401(k) if you’re 50 or over. Working longer can also help. The money in your retirement accounts can continue to grow, and when it comes to Social Security, you’ll get an increase in benefits of about 8 percent per year (guaranteed) from age 62 until age 70.

How will you begin preparing for your retirement today? To set up a complimentary consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your savings goals, contact us at 866.750.0100, email mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, stop in to see us!*

2. Emergency Expenses

“Everybody can start saving for those minor emergencies, because it’s not really a question of if, it’s just a question of when,” says Aron Szapiro, policy and finance expert at HelloWallet.com.

He’s right — it’s only a matter of time before a minor health expense or unexpected car maintenance comes into play, and the only way to prepare is to start saving. Let your first goal for your emergency fund be $2,000. Once you’re there, congratulations — you’re ahead of many Americans (63% of whom don’t have enough savings to cover a $500 emergency). Then, aim for three months’ worth of living expenses. You’re on your way to being ready for anything.

3. Credit Card Debt

Sit down with a notepad and make a list of everything you owe and — this is key — the interest rate for each debt. It’s usually a smart move to make paying off credit card debt your first priority, because it usually has the highest interest rates. Szapiro says there’s “something magical” about paying it down.

“If you have a really high interest rate of 18 percent or 20 percent, every dollar you put towards the credit card is a guaranteed return of 18 percent or 20 percent,” he says.

That’s a pretty significant return rate, and it’s risk-free.

(Note: There is one investment you can make that beats that credit card interest rate return — grabbing employer matching dollars offered in a retirement plan. If you have credit card debt and need to save for retirement, aim to do both simultaneously, even if you don’t do either fully until the credit card debt is gone.)

Don’t forget about First Financial’s free, online debt management tool, Debt in Focus. In just minutes, you will receive a thorough analysis of your financial situation, including powerful tips by leading financial experts to help you control your debt, build a budget, and start living the life you want to live.

4. Student Loan Debt

Although student loan debt is a top regret for many Americans, especially millennials, taking it on can be an investment in future salary and capital. Federal student loans tend to have low interest rates and sometimes have tax benefits, and there are forbearance options in the event of major financial difficulty.

You can also look into options to refinance your student loans at today’s low interest rates (just know that doing so takes forbearance and other payment options off the table). However, don’t prioritize paying off student loans over saving for your future. The latter will serve you better — especially if there are matching dollars in play.

5. Saving for Children’s Education

Regrets for not saving are understandable — but because financial aid exists, you have to put retirement first. That said, a smart way to start is with a 529 plan, which in many states offers an immediate tax benefit. Some plans also offer the option to contribute small amounts of money (e.g., $25) every month or pay period (again, automatically) which adds up over time.

“There’s no one magic number. It’s not like saving for a down payment for a house or something where you have a specific goal, a specific time you want to do it,” says Szapiro. “It’s something where the more you save, the more options you’ll have.”

Our Investment & Retirement Center can also assist you with setting up a 529 College Savings Plan – be sure to contact them today at 732.312.1500, email mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, or stop in to get on the right track!

*Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. First Financial Federal Credit Union (FFFCU) and First Financial Investment & Retirement Center are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using First Financial Investment & Retirement Center, and may also be employees of FFFCU. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of FFFCU or First Financial Investment & Retirement Center.

Securities and insurance offered through LPL or its affiliates are:

13 Things You Should Accomplish with Your Money Before Turning 30

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When it comes to managing money, time is on your side in your 20s. A head start on saving and investing could mean huge financial gains in the future. To help you optimize this decade, we’ve come up with 13 milestones to aim to achieve before hitting 30:

  1. Build an emergency fund. Life is full of unexpected — and, often, costly — surprises. That’s why it’s crucial to build an emergency fund.The amount of savings you need is highly personal, but a general rule is that it’s smart to have three to nine months’ worth of living expenses tucked away. Of course, you may need more or less depending on your situation. By 30, you should be at, or well on your way to, that three- to nine-month mark.
  2. Negotiate your salary. You can’t sit around and expect a raise or bonus to fall into your lap. Even if your boss notices your hard work and efficiency, he or she won’t necessarily pay you more. You have to ask for what you want.As personal-finance expert Farnoosh Torabi, who doubled her salary at 26, preaches, “You don’t get what you deserve. You get what you negotiate.”There’s a right and a wrong way to go about this delicate conversation. Read up on things you should never say in a salary negotiation, and know what you’re worth before heading into the meeting.
  3. Contribute at least 10% of your income to a retirement account. Retirement is never too far off to neglect, especially since time is on your side when you’re young. In fact, when you start to save outweighs how much you save, meaning your 20s are a critical decade.Many experts recommend putting aside at least 10% of your income. That may not be possible when you’re first starting out your career, but it’s a good goal to have by 30.Get in the habit of upping your contribution on a consistent basis — either every six months, at the end of each year, or whenever you get a pay raise — and work your way up to a 10% contribution or more.Set up a no-cost, no-obligation appointment with our Investment & Retirement Center at 732.312.1500, mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, or stop in to see us to discuss your future savings goals.*
  4. Establish savings goals and start setting aside money for big purchases. There are bound to be big expenses in your future — a home, car, vacation, and kids, to name a few — that require diligent saving.The best way to prepare for these expenses is to create savings goals, and then set aside money as early as possible. You’ll want to adjust your budget so you can contribute a specific amount of money — depending on your upcoming purchases and time horizon — into a savings account each month. Treat this money like a fixed cost, meaning you must set it aside like you would do for rent or utilities.Pro tip: Set up automatic transfers from your checking account to your savings accounts so you never even see this money and learn to live without it.
  5. Establish wealth goals. In addition to savings goals, you’ll want to establish goals for your annual income and net worth. Money won’t just appear — you have to work at it. If you want to eventually build wealth, you have to have a clear and specific goal in place before forming a financial plan to achieve that goal.Be realistic when setting a time frame to attain these bigger wealth goals, but at the same time, think big and don’t be afraid to challenge yourself. A distinguishing characteristic of rich people is their commitment to setting high expectations.
  6. Buy the insurance you need. Nobody wants to deal with insurance — it’s complex and confusing — but by 30, you should have the coverage that’s right for you. That means health, renter’s (or homeowner’s if you have your own place), auto, and disability insurance. And depending on your situation, it may mean life or pet insurance.It’s also smart to make a habit out of reevaluating your insurance plans each year to ensure that your coverage is still working for your needs and budget.
  7. Set up a method to start tracking your expenses. By 30, you should have a very good idea of how much money is coming in and how much is going out.Apart from making sure you’re earning more than you’re spending, you’ll want to get a good idea of whether or not you’re on track with your savings and retirement goals. You’ll also want to see if there’s any room to reduce spending and up your saving.Strategies to track cash flow include recording each purchase you make in a spreadsheet or notebook, or downloading an app that will categorize and monitor your monthly and annual spending, such as Mint.
  8. Pay off some of your student debt. Student-loan debt in particular is often blamed for preventing young people from buying homes and growing their wealth, so the sooner you can start living debt-free, the better.Plus, the longer you wait to pay it down, the more you’ll owe, thanks to interest. Interest works in your favor with your savings and to your detriment with your debt, when it can build up over time and sometimes end up costing more than what you originally borrowed.
  9. Experiment with a side hustle. It’s easy to focus on cutting costs and forget about earning, but the wealthiest, most successful people develop multiple streams of income.Earning more money is often easier said than done, but most people have options. Plus, it’s good to experiment with being your own boss, rather than working for your money. After all, there is a significant difference between how rich people and average people choose to get paid.
  10. Invest in something other than your retirement savings plan. Many experts recommend using investment vehicles in addition to your employer’s retirement plan to ensure that you’ll have enough to fund your golden years.If you’re maxing out your 401(k) plan, consider contributing money toward a Roth IRA or traditional IRA, research low-cost index funds — which Warren Buffett recommends — and look into the online-investment platforms known as “robo-advisers.”Of course, you’ll want to make sure that your general finances are in order before you invest. But if you have a sound emergency fund, have prepared for future expenses, and are debt-free, then the quicker you put your money to work and jump start its growth, the better.
  11. Establish a strong credit score. Your credit score, which you can check as often as you want through free sites like Credit Karma, Credit.com, or Credit Sesame, is a three-digit number between 301 and 850 based on how you’ve used credit in the past.Generally, you don’t want your credit score to dip below 650, as potential creditors in the future will consider you less trustworthy and less deserving of the best rates.While often overlooked or forgotten about, building good credit early on is essential. It will allow you to make big purchases in the future, such as insurance, a car, or a home. Start by selecting a good credit card and then focus on establishing smart credit card habits.
  12. Make your payments automatic. In today’s technologically savvy world, there’s no excuse to ever miss a payment. Most bills can be paid online, and you often have the option of setting up automatic payments. If you automate consistent payments for fixed costs — cable, internet, Netflix, and insurance — you won’t have to think about them every month and will never miss a bill.You can do the same for variable costs such as credit-card bills, although you’ll want to check in on your account regularly to make sure that things are going smoothly and there aren’t any signs of fraud.For payments that can’t be made online, such as rent, set up calendar reminders and get in the habit of paying them around the same time each month so it becomes routine.
  13. Invest in yourself. The wealthiest, most successful people are constantly exercising their brains and looking for ways to continue learning long after college or any formal education is over.Self-educate by enrolling in a course, attending a work-related conference, or investing in books. On a similar note, invest in your health — consider pursuing an appealing form of exercise, or anything else that will better your health and strengthen your mind.As self-made millionaire Daniel Ally, who reached millionaire status by 24, emphasizes: “You must take your education into your own hands if you want to prosper. Invest in yourself.”

*Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. First Financial Federal Credit Union (FFFCU) and First Financial Investment & Retirement Center are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using First Financial Investment & Retirement Center, and may also be employees of FFFCU. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of FFFCU or First Financial Investment & Retirement Center.

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Original article source courtesy of Kathleen Elkins of Business Insider.

10 Money Questions to Ask Yourself

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The first quarter of the year is a great time for reflection. And your money is no exception: Think about where it’s been, where it’s going, and, most important, where you want it to go. Whether your finances had a stellar year or took a hit, take a minute to check in and see where you want to go next. Here are 10 questions to get you started for a better financial year.

1. How much debt am I taking into the new year?
Tally up what you have left to pay on your student loans, any outstanding credit card balances, and your mortgage (if applicable). Take a long, hard look at this number. It’s better to know it than not know it. Make this number a key part of your action plan for next year.

2. How much did I save last year?
If you automate deposits into your savings account, this should be easy to calculate. (If not, here’s your incentive to do it.) Take a look at your savings account and consider what’s there: Could you have saved more? Did you plan to have more? What stopped you from meeting your goal? And if you don’t have a savings account — or a savings plan — make one.

3. What’s my credit score?
First of all, know what goes into your credit score — and then check your number free online. Check your credit report, too, and make sure any debts you’ve accrued this year are accounted for and that no one has taken out lines of credit in your name. Remember: You get one free credit report from each of the three credit bureaus a year: Equifax, Experian and TransUnion.

4. Am I getting the most out of my credit cards?
Take stock of what your credit cards have given you this year, like great rewards, lower interest rates, or cash back. If your cards haven’t provided you with any of those perks, consider upgrading to a different card. If you have a card that’s dragging you down with high annual fees, think about closing it — provided you know the consequences of doing so. Make sure you know the best way to use your cards and that you aren’t inadvertently hurting your credit.

Transfer your high balance to First Financial’s Visa Platinum Cash Plus Credit Card today!* Enjoy great low rates, no annual fees, and 10 day grace period.** Getting started is easy – apply online, 24/7. 

5. How much money will I make this year? Can I make more?
Whether you’re a full-time employee or a one-lady business, consider whether there are ways you can grow your income. Is there some sort of side gig you can take on? Could you be a consultant? If you work a 9 to 5, would a switch to freelance be more lucrative? On the other hand, is it finally time to shut down professional projects that are draining your resources?

6. What do I want to save for in the next year? How will I accomplish that?
Set financial goals, like saving for a down payment on a home, paying off a certain amount of debt, or putting a specific amount in savings. Figure out what strategies you will put in place to save, such as making lifestyle changes or automating with apps.

7. Did I stick to my budget? If not, why not?
If you blew off your budget this year, take time to troubleshoot. Maybe your goals were unrealistic or you didn’t have a budget at all. Now’s the ideal time to make one, or get started with an app or two.

8. How will I budget this year?
Once you know what has (or hasn’t) been working for you, look ahead toward optimizing. Maybe you’re ready to switch from a simple pen and notebook to an app, or vice versa. Maybe you’ve learned that you perform better on a less stringent budget and or that you actually need more structure. If you’re newly partnered (or married), this may involve merging finances — or simply merging financial goals.

9. How much money is in my emergency fund?
You have no idea what the new year could bring: sudden health crises, unexpected layoffs, or a downturn in business. Make sure your emergency fund (about three to six months of living expenses) is robust enough to take care of you if need be. And if not, make it a priority to establish a healthy fund. If you need some incentive to save, make it fun with these hacks.

10. What are some poor money habits I can squash?
Think about some areas in your daily (or monthly) life where you can save — or stretch your dollar. If you’re living beyond your means, know where to rein it in. Eating out at work? Make lunch. Tempted to go buy new clothes? How about revamping your old ones instead? Know the red flags if you think you’re in financial trouble and decide to make a change.

*APR varies up to 18% for purchases, when you open your account based on your credit worthiness. The APR is 18% APR for balance transfers and cash advances. APRs will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fee. Other fees that apply: Cash advance fee of $10 or 3% of the total cash advance amount—whichever is greater (no maximum), Balance transfer fee of $10 or 3% of the balance—whichever is greater (no maximum), Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa® Credit Card and is available to anyone who lives, works, worships, or attends school in Monmouth or Ocean Counties.

**No late fee will be charged if payment is received within 10 days from the payment due date.

Original article source courtesy of Koa Beck of Market Watch.

3 Steps to Prepare Your Finances for a Good Year

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January is over and for many of us, that means New Year’s resolutions are almost out the window. But we still have most of 2016 ahead of us. Here are a few ways you can set yourself up for financial success this year and beyond.

1. Adjust your tax withholdings.

When it comes to income tax, the goal should be to come out even. On April 15, you don’t want to get a huge refund or a huge tax bill.

Getting a refund is exciting, and it’s not a bad way to accumulate savings. But remember, that means the government has held your money for the entire year without paying you interest. In essence, you gave the government a free loan. To avoid this situation, decrease the amount of income tax you have withheld by your employer.

If you’re in the other camp and receive a big bill, that’s another reason to revisit your withholding amount. In this case, you should increase the amount of taxes being taken out of your paycheck each month.

And if your life situation changes in the middle of the year — for example, you get married or divorced or have a baby — you should also take another look at your withholding amount.

2. Increase your 401(k) contributions.

Are you saving enough for retirement? Now is a good time to review your year-end 401(k) statement or pay stub and find out how much you contributed to your retirement plan in 2015.

At the minimum, you should contribute enough to qualify for your employer match, if you have one. If you have more money available, shoot for the maximum allowable contribution in 2016 ($18,500); if you’re over 50, set up additional “catch-up” contributions of $5,500.

Making these changes early in the year will ensure that you plan your monthly cash flow around your higher contributions. And if you wait until the middle of the year to adjust your contribution amount, you’ll have to save much more each month to reach your savings goal.

Have you had your financial portfolio reviewed lately? We invite you to set up a no-cost consultation with the Investment & Retirement Center located at First Financial to discuss your current finances and future savings goals. Contact us at 732.312.1564, email mary.laferriere@lpl.com or maureen.mcgreevy@lpl.com, or stop in to see us at any branch location!*

3. Review your employee benefits.

Check your company’s resources page to make sure you’re taking full advantage of the useful — and often free — benefits it provides.

Review your current benefit elections to determine what coverage — such as health, life or disability insurance — you have in place and whether it’s still adequate. Life changes — again, including getting married or divorced or having children — can be good reasons to adjust your coverage.

If you do need to make changes, ask about your company’s open enrollment period; this is often the only time you can make changes to your coverage, unless you experience a qualifying life event, like the ones mentioned above. On the other hand, you may change your 401(k) options on a fairly regular basis.

Pay close attention to your benefits. Incorrectly selected or overlooked benefits can cost you money.

The Bottom Line

Doing these tasks early in the year can help you commit to improving your finances in other ways during the rest of the year. So don’t wait — tackle these steps today to set yourself up for a financially successful 2016.

*Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. First Financial Federal Credit Union (FFFCU) and First Financial Investment & Retirement Center are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using First Financial Investment & Retirement Center, and may also be employees of FFFCU. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of FFFCU or First Financial Investment & Retirement Center.

Securities and insurance offered through LPL or its affiliates are:

Original article courtesy of Anna Sergunina of NerdWallet.