NEW HAVEN, Conn. (WTNH) — News 8′s Kent Pierce spent the morning talking with a financial fitness expert and as some very important advice.
The advice comes from a group based in Hartford that helps people get out of debt and put some mney away for a rainy day. If you are paying just the minimum on your credit cards or borrowing money to pay off old debts, this is how to turn things around.
“I think it’s a mindset in America. We are more prone to spend than we are to save,” said Elizabeth Horton Sheff, Community Renewal Team Community Services Director.
In fact, Americans spend so much more than we save that only two thirds of Americans have enough money for unexpected things like car repairs or doctor visits, and almost half of families making less than 50 thousand dollars a year rely on credit cards to pay for basic needs.
The Community Renewal Team is a nonprofit agency that helps people prepare for the future. Elizabeth Horton Sheff says first, set goals.
“Do you want to reduce your debt? Do you want to purchase an asset? A car, a home? Are you saving for a vacation?” she said.
Does your goal seem too far away? It can seem like your money disappears too fast.
“But if you sit down and track your spending, you can figure out where your spending leaks are, you can plug those leaks and begin to save,” she said.
Another tip is to save your loose change. Put it in a jar and watch it add up fast. You can also cut out the soda, which is good for your body and wallet. Drink regular coffee instead of that expensive latte.
“Bring your lunch to work instead of spending that $5 a day on that bagel and coffee. I mean, all of it adds up,” she recommended.
If you think America runs on coffee, think again.
“America runs on credit and that’s unfortunate, because the interest rates are high on credit cards,” she said.
Interest rates only get higher if you miss payments. So, pay off the cards on time and try to pay more than just the minimum.
This is the time of year when we start thinking about the getting a tax refund check, but don’t blow it on something you don’t need
“Take it and pay down those debts. That way you’ll be better off financially in the long run,” she said.
When you get it, remember your financial goals and put part of it into your savings account. Also, remember to save not just for planned expenses, but unexpected ones as well.
“Most people aren’t saving enough to cover emergency expenses, everyday expenses, and retirement expenses,” she said.
Millions of Americans are not saving as much money for the future as they should. On Good Morning Connecticut Wednesday Kent spoke with Elizabeth Horton Sheff of Community Renewal Team about personal finances as part of ‘America Saves Week’.
How much or how little do Americans save?
- 54 percent of Americans say they have a savings plan with specific goals
- 43 percent of Americans say they have a spending plan that allows them to save enough money to achieve the goals of their savings plan
- 66 percent of Americans have sufficient emergency funds for unexpected expenses like car repairs or a doctor’s visit
- 45 percent of families with annual incomes under $50,000 rely on credit cards to pay for basic needs
Here are some easy everyday savings you can make to save pennies or dollars a day.
- Save loose change
- Cut soda consumption
- Substitute regular coffee instead of specialty coffee
- Bring lunch to work
- Eat out less
- Borrow books instead of buying
- Pay credit card bill on time
- Pay off credit card debt to reduce interest
Other ways to cut spending include:
- Keep record of monthly spending
- Comparison shop for necessary items
- Limit spending for birthdays & holidays
- Build an emergency fund
- Automatically transfer funds from checking to savings account
- Put loose change into savings account
- Avoid high-interest credit cards and payday loans
For more information about finances and saving visit the Community Renewal Team at CRTCT.org or call 860-560-5600.