4 Ways To Quit Neglecting Your Savings Account

By Chuck Bentley

Looking ahead to the future is an important, but often scary, thing to do, especially when it comes to your finances. The best way to prepare for the future and give yourself a financial margin is to establish a healthy savings account. Not only will it help to ensure that you have the cash to cover expenses, but it will help you stay out of debt, reach your goals, and live without stress.

According to Bankrate, about 20% of Americans do not even have a savings account, and out of the ones that do, about a fourth of them are saving less than 5% of their income. Almost the same number save nothing at all! Saving doesn’t come naturally to everyone, but that doesn’t mean you can’t do it.

Take a Look at Your Finances

Sit down and take some time to uncover what your exact financial situation is. Look at your monthly income and budget, see what margin you need to stay within to cover your primary expenses, and then allocate an amount each month to put back into your savings. Cut out the unnecessary things that are preventing you from saving, and form a lifestyle that can equip you with more ways to save. It is also important to make a distinction between money that you want to save and money that you want to invest. Your savings should be liquid, accessible at any time in case of an emergency.

Make a Plan

The saying “he who fails to plan is planning to fail” rings true for your finances! Make short- and long-term savings goals and come up with a plan (starting with a budget) on how you’re going to reach them.

Distinguish between emergency savings and big purchase savings. Maintain at least $1,000 in an emergency fund at all times as you work your way up to 9-12 months’ of living expenses. If you want to buy a new car, go on vacation, or put the kids in braces, save for those specific goals. Assign a dollar amount and a time frame to your goal and get to work!

Expect the Unexpected

While becoming future-oriented is very important when saving, our plans rarely go exactly how we imagined. Proverbs 16:9 tells us that, The heart of man plans his way, but the Lord establishes his steps. Whether it’s God’s plan or the broken water heater that surprises us, be ready to be flexible. If things do not go exactly how you had imagined when it comes to your finances (or any other aspect of your life), just remember that His divine plan is a part of your journey.

Create Savings Goals

Having goals for your savings can help you to be more intentional with your money and help you to see a present purpose in it rather than only seeing its future potential. It is important to save $1,000 and to keep that money on hand in an Emergency Savings Account that you do not spend unless absolutely necessary. Once this is achieved, try to keep saving until you have 3 to 6 months of your living expenses in this account. The Money Map can help walk you through each of these savings goals, as well as other financial goals.

After these savings goals have been met, you should save for major purchases and begin using those funds to invest. Most people I talk to have a problem because they start investing money BEFORE they have adequate savings. This means when an emergency arises, there is normally a penalty to take money out of your retirement plans.

Think of the horse and cart analogy. The horse comes first. It should be a regular savings habit sufficient to meet these two goals. The cart is the long-term investments that come later. The percentage is up to you so long as you are able to hit these minimum savings targets in a reasonable amount of time. Once you have hit those targets, you can begin to work towards saving the recommended amount of 15% of your total income.

Working on your savings account now rather than later can help bring you closer to your financial goals and even assist with calming financial stress in the future. Take ahold of your savings and maintain a consistent plan that works for you. Though it might seem difficult at first, taking this initiative will help you navigate through your finances and better equip you for whatever the future may hold.

​Read More

Now Is the Time to Prepare Financially for Hurricane Season


Survivors at all income levels have experienced the challenges of rebuilding their lives after hurricanes Irma and María. Financial preparedness is an essential part of 2018 hurricane season planning.

Being financially prepared means you should:

  • Consider the costs associated with disasters such as insurance deductibles and evacuation costs, and plan for those costs. Anticipate initial out-of-pocket disaster expenses for lodging, food, gas and more.
  • Check your insurance coverage. Whether you’re a homeowner or renter, contact your agent to ensure you’re adequately covered and understand exclusions. Don’t forget coverage for your car and remember that standard homeowners insurance doesn’t cover flood insurance which requires 30 days to take effect.
  • Download FEMA’s Emergency Financial First Aid Kit at www.ready.gov/financial-preparedness. This kit is a flexible tool designed to help you collect and secure the documentation you would need to get on the road to recovery without unnecessary delays.
  • Keep some cash handy. Banks and ATMs may be inaccessible if there are power outages or curfews.
  • Set aside money in an emergency fund. This can be difficult to do on a tight budget but can be well worth the effort. Start by saving a few extra dollars each week and spread out your 10 days’ worth of supplies shopping to avoid a one-time large expense. Keep your emergency funds in a safe, easily accessible account.
  • Set aside an emergency-only credit card. If possible, designate one credit card for emergency use only. It should have enough available credit to accommodate purchases of food and supplies for a week or more. Making purchases on a credit card will help you document disaster-related expenses.
  • Flood-proof important papers. Place photocopies of important documents in a plastic bag and double wrap them to protect against water damage. You could also upload digital copies of important documents to the cloud.
  • Get your benefits electronically. A disaster can disrupt mail service for days or weeks. If you depend on Social Security or other regular benefits, switching to electronic payments is a simple, significant way to protect yourself financially before disaster strikes.

Take the time now to identify, collect and update your personal and financial records and documents. It will help you be prepared ahead, rather than get caught up in the rush of events.

​Read More

Disaster-Proof Your Pocketbook in Three Steps


Severe weather such as floods, storms, and tornadoes are threats to take seriously and prepare for. But not all disasters have to be record-breaking or historic to be catastrophic to your family. What about a wildfire that destroys your home and all of your belongings? Or a sump pump failure that damages your home’s electrical, water heater and furnace, leaving feet of contaminated water in your basement?

“Even if you have insurance coverage after a disaster, you may wait weeks before you receive a claims payment,” said James K. Joseph, regional administrator for FEMA Region V in Chicago. “Planning now for what you’ll do after an emergency will make recovery that much easier. Your plan should include options for temporary housing if you can’t immediately return home, and having cash at the ready to pay for essentials such as food, water, clothing, and toiletries if they need to be replaced.”

While you can’t always predict when or what type of a disaster will occur, you can be ready for one. Here are a few steps to start:

  1. Have cash on hand. Set aside enough cash to get you and your family through multiple days after an emergency. Consider what the costs would be to temporarily house, clothe and feed your family for up to a week. This is especially important if ATMs, banks and credit card machines aren’t functional due to an extended power outage. Include smaller bills as well, in case stores aren’t capable of making change. If putting aside that much money isn’t an immediate option, consider saving in smaller increments to eventually save the amount you may need.
  2. Have copies of important personal and family information. If you lost everything in a disaster, what will you use to prove your identity to get credit cards reissued, file insurance claims, or request disaster assistance? Have extra originals or copies of passports, driver’s licenses, birth and marriage certificates, adoption decrees, Social Security cards and military records stored in a safe, easily accessible location to avoid any issues.
  3. Obtain property insurance. Of the estimated $55 billion annual natural catastrophe losses in the U.S., more than half aren’t insured. Talk to your insurance agent about the coverage your home may need. Review existing policies and ensure the amount and extent are adequate to cover losses from any possible hazard. Homeowners insurance covers wind damage, but a rider needs to be added to ensure against sewer backup. In addition, homeowners insurance doesn’t typically cover flooding, so you may need to purchase flood insurance from the National Flood Insurance Program (NFIP). Individuals can purchase flood insurance through an insurance agent or an insurer participating in the NFIP. If your insurance agent does not sell flood insurance, you can contact the NFIP Referral Call Center at 1-800-427-4661 to request an agent referral.

For more information on how to financially prepare for an unexpected emergency or disaster, visit www.ready.gov/financial-preparedness.

​Read More