Financial Wellness

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Financial Wellness

• The NEWEST Edition to the Wellness Family.
• In Partnership with the UCSD Financial Aid Office
  and the Student Business Services

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What is Financial Wellness?

• Knowledge of resources that will help fund
  education and living expenses.
• The ability to maintain a balanced budget.
• Preparedness for all expenses, including
  short-term, long-term, and emergencies. 

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A Person Who is Financially Well

• Develops a balanced budget that manages both
  income and expenditures.
• Is knowledgeable about the ways to receive
  scholarships, loans, and grants for school.
• Has one credit card or no credit cards.
• Makes good consumer choices.
• Focuses on saving money instead of spending
  money.
• Plans and prepares to deal with all expenses
  (living, school, short-term, long-term,
  emergencies).

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Dos Of Credit Cards

• Make wise decisions about purchasing items you
  need versus those you simply want.
• Using your credit card responsibly means
  recognizing which things you need and which you
  just want.
• Let your creditor know in advance if you wont be
  able to make your monthly payment on time.
• The worst thing you can do is simply forgo your
  credit card payment, no matter the reason. Simply
  call your creditor, briefly explain the
  situation, and ask that any late fees be waived.

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Dos Of Credit Cards

• Stay within 30 of your credit limit.
• A large part of your credit score considers the
  amount of debt you have. Keeping your balances
  low helps you maintain a good credit score.
• Negotiate a lower interest rate.
• Your interest rate determines how much you pay
  for carrying a balance on your credit card.
  Evaluate the interest rate on your credit card
  periodically to be sure you are getting the best
  deal possible.

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Do Nots of Credit Cards

• Get into the habit of making minimum-only
  payments.
• Making only the minimum payment each month
  increases the amount of time it will take to pay
  off your debt. It also increases the amount of
  interest you end up paying.
• Use your credit card to make everyday purchases.
• Using your credit card as a substitute for cash
  is a habit that can quickly lead to debt. For
  ordinary purchases, leave your credit card in
  your wallet and use cash or debit card instead.

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Do Nots of Credit Cards

• Close out a credit card without knowing how your
  credit will be impacted.
• There are times when closing a credit card can
  hurt your credit score. Avoid closing cards that
  still have a balance or those that make up a
  significant amount of your credit history.
• Use your credit card to buy things you cant
  afford.
• Living a borrowed lifestyle is the quickest way
  to get into debt. If you cant afford a purchase
  today, chances are you wont be able to afford it
  tomorrow, or even next month.

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Budgeting Your Funds

• 1. Gather every financial statement you can.
• This includes bank statements, investment
  accounts, recent utility bills and any
  information regarding a source of income or
  expense. The key for this process is to create a
  monthly average so the more information you can
  dig up the better.
• 2. Record all of your sources of income.
• If your income is in the form of a regular
  paycheck taxes are usually automatically
  deducted. Use the net income, or take home pay,
  amount. Record this total income as a monthly
  amount.

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Budgeting Your Funds

• 3. Create a list of monthly expenses.
• Write down a list of all the expected expenses
  you plan on incurring over the course of a month.
  This includes a car payments, auto insurance,
  groceries, utilities, entertainment, and auto
  insurance, and essentially everything you spend
  money on.
• 4. Break expenses into two categories fixed and
  variable.
• Fixed expenses are those that stay relatively the
  same each month and are required parts of your
  way of living. They included expenses such as
  your rent, car payments, cable and/or internet
  service, trash pickup, credit card payments and
  so on.
• Variable expenses are the type that will change
  from month to month and include items such as
  groceries, gasoline, entertainment, eating out
  and gifts to name a few. This category will be
  important when making adjustments

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Budgeting Your Funds

• 5. Total your monthly income and monthly
  expenses.
• If your end result shows more income than
  expenses you are off to a good start. This means
  you can prioritize this excess to areas of your
  budget such as retirement savings or paying more
  on credit cards to eliminate that debt faster. If
  you are showing a higher expense column than
  income it means some changes will have to be
  made.

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Budgeting Your Funds

• 6. Make adjustments to expenses.
• If you have accurately identified and listed all
  of your expenses the ultimate goal would be to
  have your income and expense columns to be equal.
  This means all of your income is accounted for
  and budgeted for a specific expense. If you are
  in a situation where expenses are higher than
  income you should look at your variable expenses
  to find areas to cut.
• 7. Review your budget monthly.
• It is important to review your budget on a
  regular basis to make sure you are staying on
  track. After the first month take a minute to sit
  down and compare the actual expenses versus what
  you had created in the budget.