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Practical Ways to Reduce Your Spending, Increase Your Savings, and Achieve Your Goals

If you are like most college students, you might not have a budget in place, or if you do have a budget you may find it hard to stick to. Budgeting is one of the most important ways to help you get on track and stay on track to achieve your financial goals. If you can learn to budget well early on, it can help you be prepared for when you begin paying on your student loans, have a mortgage payment due each month, or are trying to determine how much you can set aside for retirement while still paying the bills. So, how do you actually do that? What are some practical ways you can make changes to your budget…and stick to them?

  1. Estimate your current income and expenses

First, in order to have an idea of what you are currently spending, it is important to estimate where you are at financially. This will also help you see what you believe you are spending. You can come in and meet with one of our peer counselors to walk through this first step of the budgeting process together.

  1. Compare those estimates with reality

Once you have your estimates in place, compare those numbers to your actual income and expenses. If you use your debit card for everything, pull up your past 1 year’s worth of bank statements and average out what your monthly expenses and income were. Using a full year helps give the most accurate picture so that you can account for any extra income you may have from a summer job as well as increased or decreased expenses you’ve had in the past year. If you don’t use a debit card or have any past records of your finances, no worries. You can start keeping track through different websites, apps, receipts, or by writing it down. Some websites will allow you to manually enter in your expenses as well as link with your checking account. This can be a great tool especially if you use both cash and your debit card. One great website to use is www.mint.com.

  1. Set SMART goals

Having goals almost always helps us focus on what it is we are wanting. Setting financial coals can also help you stay on track in order to achieve your goal. Whether you are hoping to study abroad next semester, save enough money over the summer for next year’s tuition, or plan to backpack Europe after graduation, you need to have goals to help you achieve these dreams. The first part of making a SMART goal is to make sure it is Specific. If your goal is vague and has no direction, it will be hard to stick to. The next part is to make it Measurable. If you don’t know how much you are needing to have or how much you should be setting aside for a goal, that can make it difficult to contribute toward the funding of that goal. Having Achievable goals are also really important. You don’t want to set a goal that you know there is no way you can attain. Right along with being achievable, your goals need to be Realistic or Relevant. You want to make sure that the goal you have set is something that is actually what you want and something that makes sense for you personally. And the last part of making a SMART goal is to make sure it is Time-Sensitive. All goals typically have a date that you want to achieve them by. Having a set date for when you want to have the goal achieved or having a time increment where you will always save a specific amount of money will make planning for that goal so much easier. An example of a SMART goal is:

I will set aside $20 each week for 3 months to save $250 for my summer break trip to my Uncle’s house.

  1. Determine a budget that you want to stick to

After you have your goals in mind, you can start determining what you want your budget to look like. Just like your goals, you need to make sure your budget is realistic. If you cut out all of the fun stuff, it can make sticking to your budget extremely unsatisfying. Reducing your expenses will likely be more effective than completely cutting them out. Evaluate what is important to you, and allocate the amount of money you think is appropriate. Also, make sure you are setting aside money for savings. It is especially important that you have an emergency fund. If an expense comes up that you weren’t expecting, and the only money you have saved is for a fun trip, it is going to be a huge bummer to dig into that savings. But, if you have an emergency fund in place, you can be prepared for those unexpected expenses and not drain the funds you had been planning for your goals.

  1. Find the tools that will help you stick to your budget

If you found out that you spend $25 on coffee each week, one way to reduce this amount is to start making your coffee at home. Another option to reduce that expenditure would be to only go to a coffee shop 1-2 times a week instead of every morning. Although Redbox movies and vending machines typically don’t seem like much money, if you are a frequent visitor, that money can begin to add up. Ways to reduce this could be to borrow movies from friends and family, or bring snacks from home with you when you go to campus. ATM fees are one expense that can be avoided if you plan ahead properly. Pulling out money from your bank or getting cash back when you go to Walmart can help wipe-out those ATM fees that add up fast.

One area where a lot of students overspend is in eating out. It’s a great way to socialize with friends, and it is also super convenient when you don’t have the time to make a meal. One way to reduce this cost could be to prepare meals on the weekend for the week ahead. If you have quick meals that you can pull out of the freezer or fridge and heat up, it is a fast and cheaper solution than grabbing the 8th box of pizza in 2 weeks. Another option is to go places that have student discounts or send out coupons. Many restaurants have apps or will send emails that can help reduce the cost of going to eat there. The great part about living in a college town as a student is all of the discounts that are available. Check out the local restaurants to find out when and what deals they offer, and have your student ID handy!

If you spend a lot of time with your friends doing activities that cost money, let them know you’re wanting to save for a specific goal and offer some suggestions for a free activity you can do together. Or, if you’re both planning on going on the same trip, it is a great way to hold each other accountable to your savings goals. Another option some people like to use is the envelope method. Once you have figured out how much you are willing to allocate toward each category of your budget, put that amount of cash in an envelope so that you’ll know once the money is gone, you don’t have more money to spend for that particular area until the next month. Make sure you don’t lose it! www.mint.com can also help you keep track and send you updates when you are getting close to your spending allotment for the month.

  1. Revisit and update as your financial situation changes

Budgeting is not just a one-and-done thing. It is something that will continually need to be monitored and updated as your situation changes. If you get a raise at your job or move to a new place that is more expensive than the place you lived in last year, you will need to reflect those changes in a modified budget. Taking steps early on to reflect those changes will prevent you from running into the situation where you run out of money because you made the same amount each month but now had increased expenses.

Budgeting will take some discipline and habit, especially when you are first starting out. Over time, it will become more routine and manageable, so stick with it. If you would like help starting the budgeting process, please make an appointment with us. One of our peer counselors would love to meet with you and walk through these steps with you. For more information on budgeting, feel free to visit our website and click on the budgeting tab for a copy of our budgeting worksheet and other budgeting tips. Other topics we would be happy to assist you with include student loans, evaluating job offers and employee benefits, and credit. Make an appointment by going to www.ksu.edu/powercatfinancial to set up a free and confidential appointment.

Lindsay Adams – Peer Counselor II

5 Reasons Why You Should Use Your Salt Account in April


Happy Financial Literacy month! When it comes to finances, there is always something more to learn or improve on. Have April be the month you finally get all your questions answered! K-State has provided the opportunity for every student to have an account on www.saltmoney.org. Salt is a free financial website that can answer various financial questions as well as provide students with tools to enhance their financial fitness. Here are 5 reasons you should use your free account during the month of April.

New Interface

New year, new Salt interface! The website, www.saltmoney.org has updated its look to be more aesthetically pleasing as well to help tailor the Salt experience to each individual user. All of the same assets Salt has are located in the new webpage, but may be in a different place than before. However, they are not hard to find—spend 5-10 minutes exploring the new page!

Goals

The new Salt goals tool are what is helping Salt know what information will be most valuable to the user. When you sign onto the website, it will have you select your goals and their order of importance. The goals are: Manage Money, Repay Student Debt, Find A Job, and Plan School Costs. At least one of these goals can apply to anyone; more than one may be applicable to you! By defining your goals, you are one step closer to achieving them. Once you elect the order of importance to you, Salt will direct you to your first step in tackling each goal. As previously stated, anyone can benefit from this tool!

Scholarship Search

I could use less scholarships”, said no college student—ever. As we each prepare with our strategy for paying the next semester of college, scholarship money is yearned for. Salt has a very helpful tool to help find scholarships unique to each student’s location, education, background, work, and activities. To access the scholarship search, sign onto your free Salt account, click the Menu button followed by the Tools and Calculators option, and you will find the scholarship search under the Plan School Costs heading. If you would like further help on deciding how to pay for your college experience, do not hesitate to schedule an appointment with Powercat Financial.

Job/Internship Search

There is one thing we all have in common as college students: the desire to be employed upon graduation. As May approaches and you still find yourself not knowing what to do after graduation or for the summer, save some time of your day to use Salt’s job and internship search! To access the job/internship search, sign onto your free Salt account, click the Menu button followed by the Tools and Calculators option, and you will find the tool under the Find A Job heading. This tool will help you narrow down jobs or internships depending on your major or area of interest and desired location.

Scholarship Giveaway

The final reason you should either log onto your free www.saltmoney.org account or create an account with Salt is because you can win either a $200, $125, or $75 scholarship provided by Powercat Financial! In order to qualify, you must complete Salt courses. These can be found under the Menu button on the Salt homepage. The courses are over various financial topics that either apply to your life currently or will apply to you in the future. The more courses you do, the better chance you have to win! The courses must be completed and passed between April 1st and April 30th in celebration of April being Financial Literacy Month. In order to win, you must be a currently enrolled K-State student with a Salt account. To sign up for a free account, go to www.saltmoney.org/k-state. Your account will be free for life, even upon graduation!

If you would like more information on any topics discussed above, please don’t hesitate to schedule an appointment with Powercat Financial. Any peer counselor would love to help you out!

Allison Becker – Peer Financial Counselor II

Planning for a SMART New Year

Image result for new years and planning

As we approach the end of the year, we often reflect on what we have and have not accomplished throughout the year.  When we set our goals and New Year’s resolutions, we have grand ideas and plans.  One way to achieve our plans is to set SMART goals rather than general ones.

Be specific.  It is difficult to achieve a vague idea.  For example, set a definitive goal of I would like to take a vacation in June to California instead of I would like to take a vacation someday.  Not only does this give you a time-frame, it allows you to research what you need to achieve this – such as costs.

Next, your goal should be measurable.  By knowing the details, you can set incremental goals to achieve the bigger, overall goal.  Take my trip to California – I need to know the cost I plan on spending and when I am going, so I can start saving now.  For instance, if my trip is going to cost me $500, and I plan on going in 6 months, I need to save just under $85 per month.  I will be able to measure my progress each month as I save money.

Your goal should be achievable.  If I currently have no income, it will be very difficult to save $85 per month.  A better goal at this point would be to find a job, so I can have the money to save for a vacation.

Having a relevant goal is important.  If it does not matter to you, you will not be motivated to achieve it.  Personal values and aspirations are necessary components of setting goals that matter to you.  Why do I want to go to California?  For me, it is not just a fun vacation, but I have family there that I haven’t been able to see for a while; therefore, I am more motivated to save money each month.

Finally, having a time-frame will help you reach your goals.  While I would love to go to California next month, I will not have the time to save the money by then.  Also, setting the time-frame far enough out (June), but not too far (such as sometime in the future) gives you more specific direction.

Whether your ambitions are financial, related to school or a future job, as you approach goal-setting next year make sure you set SMART goals.

Specific

Measurable

Attainable

Relevant

Time-frame

Fulfilling your New Year’s resolutions will be within your reach!

Shari Humbard
Peer Counselor II
Powercat Financial Counseling

Love Your Money

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People are willing to do a lot for someone they love such as try new things, change their style, and even relocate.  However, what are they willing to do for their money?  Sometimes it can be misplaced, torn up, abandoned, left unprotected, and even thrown away on insignificant things.  What if you treated your money as special as you would treat someone you love?  Things you may do are…

Make Time For It

When you love someone, you may hang out more and more and structure your day around him or her.  How much time do you take for your finances though?  Try carving out some time in your day or week to:

Just like relationships, your money can flourish if you put in the time to get to know it and make a point to include it in your everyday living.

Show It What It’s Worth

You may buy flowers or gifts, go out to a nice dinner, and even spoil each other to outwardly show your love and communicate your significant others’ worth to you.  However, the cumulative cost of junk food, drinks at the bar, bank fees, and other spending that will seem insignificant further down the road when you’re going to purchase a new car, have a child, or retire.  Instead, show money its worth through:

  • Smart shopping (i.e. sales, coupons, and discounts)
  • Memorable spending (i.e. experiences in place of material goods)2
  • Mindful prioritization (i.e. saving for a coffee maker later instead of a cup of coffee now)

Prioritize It

As relationships progress, your significant other becomes a bigger and more important part of your life.  This may lead to changes in how you structure your day, the traditions you create, and the sacrifices you make for the betterment of the relationship.  Likewise, your financial priorities change throughout life and become more and more necessary in order for you to accomplish your financial goals.  Some current wants may need to be cut back in to make room for saving up for more special wants (i.e. vacation) and future needs (i.e. house payment).  Steps to prioritizing your spending to enhance your financial relationship:

  1. Brainstorm financial goals
  2. Make your goals SMART3
    1. Specific (what why and how)
    2. Measurable (set dollar amounts)
    3. Attainable (realistic)
    4. Relevant (fits with bigger picture and your other goals)
    5. Timely (set dates)
  3. Calculate how to achieve your goals
  4. Tweak current budget and spending accordingly
  5. Find an accountability partner

Protect It

We want to do everything to protect the one we love both physically as well as emotionally from any pain.  Sometimes, life happens and we do the best we can to build back up and heal.  There are many ways to protect your money such as having an emergency savings to cover unexpected expenses and prevent debt or outrageous interest costs as well as consistently monitoring for identity theft and bank fraud.  Emergency savings should have 3-6 months’ worth of money in a relatively easily-accessible account to cover such things as medical bills, car repairs, or a loss of job.  You can monitor your credit through pulling a credit report at least every 4 months (https://www.annualcreditreport.com) and can protect from bank fraud by review your bank statements and utilizing credit card EMV technology when you can4.

Be Patient With It

Rushing into things can sometimes end up bad and sometimes the best things in life take time and hard work.  Your money probably won’t grow overnight (barring lottery winnings and surprise inheritance), so you’ll need to be patient with it and continue to nurture it.  Interest rates are most beneficial over time and frequent changes in investments may not pay off.  The market changes every minute, but despite dips and turns, a lot of investments pay off if you are patient and wait out the lows.

Commit

So you’ve spent some time together, you’ve gotten to know him or her more, and you’ve decided that he or she is worth prioritizing.  The next natural step is to decide whether you want to stay together in the future and beyond.  Rather than staying focused on the present, you may make a commitment for the long-haul.  Similarly, this may be something beneficial to do with your finances.  Picture your life with it in the future and what you want that to look like.  You’ve mastered saving for emergencies and upcoming trips, now what about for retirement or future children’s educational expenses?  These decisions come with more of a commitment due to the limitations on their spending, but can be truly beneficial in the future should you follow through on the commitment.  Time is your greatest ally in the realm of saving and investing.

Resources

  1. http://www.k-state.edu/pfc/planning/Financial%20Goals%20Worksheet%20-%20Specific.pdf
  2. http://www.forbes.com/sites/hbsworkingknowledge/2013/08/05/want-to-buy-happiness-purchase-an-experience/#34522db1704d
  3. http://freefrombroke.com/guide-setting-smart-goals-finances/
  4. http://blogs.k-state.edu/pfc/2015/10/05/credit-cards-are-changing-are-you-ready/

Christyne Stephenson
Peer Counselor III
Powercat Financial Counseling
www.k-state.edu/pfc

New Year, New Financial Attitude

Believe it or not, 2015 will be coming to an end before we know.  With that for many people comes a “New Years Resolution” and financial stress. As December approaches, it is important to spend some time reviewing the past year and making goals for the upcoming year.  Some tips to consider when preparing for the new year are: budgeting, goals, financial literacy, and savings.

If you haven’t made a budget, it is a great first step towards achieving financial success.  Budgeting can be overwhelming for some people, but just keep in mind that it is a process and requires both time and work.  Use December expenses and income as a rough draft for your budget so when the beginning of the year rolls around you are ready to really focus in on your financial situation. Using December as a practice run allows students to have some experience at the beginning of the year, instead of being new to the budgeting process.  This experience gives students a chance to start planning ahead for the upcoming semester, school expenses, or the opportunity to begin saving for spring break.

Speaking of spring break or education expenses, goals are a vital piece of creating a budget.  The end of one year and beginning of the next is a great time to set some new financial goals.  There are short-term and long-term goals.  A short-term goal is something that you want to achieve within the next year and a long-term goal is something you want to achieve in longer than a year.  If you had goals from the previous year, be sure to address the process of them.  It is especially vital to review any previous long-term goals you had set.  It is really important to make sure that any goal you want to achieve is a SMART goal.  SMART goals stand for specific, measurable, attainable, realistic, and timely.  For example, if you were saving for a new car a smart goal to achieve that could be: “I would like to purchase a new car by December 2018 for $10,000 by saving $188 a month.”

Making financial decisions can be difficult for many college students who are managing their money for the first time in their life.  If you are feeling financially stressed, feel free to reach out and get help. A great resource for students at Kansas State University is a free individual counseling session with our peer counselors and Salt.  Salt is the free online financial tool Powercat Financial Counseling bought for students and alumni that offers numerous financial articles, tools, and many other resources.  A recommendation that is helpful when making good financial decisions is to find out what motivates you to make those decisions.  Do you have a goal in mind when you make positive financial decisions or is it the feeling of achievement you feel?  Either way, use that motivation to continue to find success in your financial situation.  If you are unsure of what motivates you, try to really think about the reason behind the financial decisions you want to make.

Lastly, as the new year begins make saving a priority.  A beneficial habit for students to establish is to pay themselves first.  If you try to make it a priority to save a little bit of money each and every month before spending more the financial goals you set will start to become a reality.  If you aren’t sure where or how to start savings, start small. Instead of spending $2 a week at the vending machine, try saving that and at the end of the year if you saved that $2 every week you would have a total of $104 of just vending machine money each year!

Although this can be a stressful time of the year with a lot of extra expenses, just remember to take a deep breath and plan ahead.  The new year is always a great time to regroup and form positive financial habits.  If you make a financial resolution, try to stick with it and the hard work will pay off.  Powercat Financial Counseling is here to assist you in making these steps as well.

Kristen Payne
Peer Counselor I
Powercat Financial Counseling
www.k-state.edu/pfc

Be Your Own Business

We continually look for ways to grow as individuals and establish ourselves. The world we live in now revolves around us going to school, getting a job, buying a car, buying a home, getting married, and possibly creating a family. We are surrounded by our family, friends, and millions of businesses. A business is considered an entity that is either commercial, industrial, or professional. When we hear the word ‘business,’ we typically think of an organization that offers a product or service. But has anyone ever thought of themselves as their own business? As an entrepreneur? We go our whole life trying to make a living to take that next step towards our short and long term goals. We generalize ideas, take steps, create a process, and attempt to follow through with those ideas like any business would. To successfully be your own business or an entrepreneur, you must think logically and take careful considerations when thinking about your financial position and how to obtain your goals.

To be your own business or an entrepreneur, one must start early to plan their short and long term goals. Develop a realistic plan of how you want to obtain your goals and when it could possibly be reached.  For an example, if you have student loans, you can start paying them off now while in school and become that much closer to paying your debt off. The closer you are to that, the closer you are to buying that first home, or the car you have always dreamed of.

Start thinking early about your credit. To get any kind of loan, one needs good credit. Some employers even look at your credit to see if you are financially responsible. That one number can say a lot about someone and can even be a factor that contributes to your employability. To start establishing credit, you can ask to be added to a relative’s source of credit until you have enough to get a credit card of your own, or you can apply for a secured credit card.

Although you are young at this point in your life, you also need to start thinking about retirement and savings for the future. Start contributing a small amount of your paycheck to your savings each month, or make sure to max out the contribution your employer will offer to your 401(k) plan when you get a job.

If you need help to get on the right track of becoming your own business or an entrepreneur, Powercat Financial Counseling will assist you in a free, friendly, and confidential environment.  You can create an appointment at http://www.k-state.edu/pfc/services.

Doni Lee
Peer Counselor I
Powercat Financial Counseling
www.k-state.edu/pfc

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