Put tomorrow's needs ahead of today's wants

ST. MARYS - Pay yourself first. Get yourself into your monthly budget right along with the electric bill, mortgage payment, telephone bill, and whatever else you routinely pay.

"The economy is tough right now, but you can still gain at least a little bit. Pay yourself whatever you can no matter how small. Even a dollar a day will help you in the long term," said Tanya Temple, branch sales manager at Three Rivers Federal Credit Union in St. Marys.

Her audience was about a dozen people gathered at the St. Marys Community Public Library on Tuesday for the "Pay Yourself First" program.

With 12 years experience in the financial field, Temple explained basic steps to freeing some money each month to put in savings.

"If you eat out every day, don't go to a restaurant one day and put that $5 or $6 in your savings. If you get coffee or soft drinks from a vending machine every day, bring something from home one day and put that money in savings," she said, emphasizing that consistently saving a little here and there adds up.

Money put into a savings account is going to earn interest even though rates are small right now. There are people who keep their savings under the mattress rather than in a bank or credit union. Money in a savings account will increase; cash under the mattress won't.

"It's hard to save right now. But it can be done. Consider your spending as to needs versus wants," she said.

Examples of good debt (needs) include college tuition for yourself or a child and buying/remodeling a home. Both are investments in the future. Bad debt (wants) could be a vacation cruise loan.

"Wouldn't a cruise be nice right now?" she said. "But it is soon over and you'll still be paying on the loan 12 months later."

Save any sort of windfall money - a raise in pay, cash gifts, a bonus from your employer. When you finally pay off a loan, keep making that payment into your own savings.

"Get your savings on direct deposit. If you direct deposit a certain amount each pay period into a savings account, that's money you never handle and don't really think about," she said. "You'd be surprised how quickly you can build up your savings."

With rates at an all time low, the big buzz right now is refinancing a home mortgage. She pointed out the market is very volatile, changing from moment to moment.

"A 15-year loan with decent credit history is 41/2 percent fixed ... A key to remember is that you would need to reduce your interest rate by at least one point to offset the closing fees. Of course, if you can go from a 30-year to a 15-year, you're going to save a boatload anyway," she commented.

Saving money is based on several decision factors beginning with personal goals, she said.

"Figure out how much you want to accumulate and how long you can leave your money invested. What's your tolerance for risk? These are points you must determine," she advised.