By Jodi Golden
Indiana Education Savings Authority
January 12, 2015
Being a couple of weeks into the New Year, a lot of us are already questioning some of those New Year resolutions we made on January 1. Unfortunately, a large number of Americans struggle with continuing that healthy diet or active exercise regimen. These are vitally important to living a quality life and should certainly be a priority.
However, another type of resolution frequently made and broken pertains to financial goals. Be it creating an emergency fund, paying off debt or saving for your children’s college education, we all start out with the best of intentions. Unfortunately, they don’t always last.
In the spirit of encouragement, I’ve found a few helpful tips in an article from U.S. News and World Report* that could ultimately help other areas of your financial life; allowing you to then focus on saving for other important goals such as retirement and education.
1. Track your expenses for a two-week period.Trust me, this will be an incredible learning experience for you. Write down every single expense you make in that period from the cup of coffee in the morning to your weekly grocery bill. You will be amazed at how many “unnecessary” expenses you make and how quickly they add up.
2. Resist retailer enticements. Whether it be rewards points, rebates, or a big sale, make sure you’re purchasing items that are needed. Don’t buy things just to receive the extra points, rewards or prizes.
3. Research your purchase before visiting the store. If you’re making a bigger ticket purchase, make sure you do your research on the product, the price and any warranties or discounts that may accompany it.
Find the store with the best deal for you and don’t “shop” while you’re there. Buy the product and leave.
4. Pay off other debts.Why pay interest when you could be earning interest? Start paying off those other credit card or student loan type debts. Paying those off will free up that money that you can then begin to put into another savings account, such as a 529 Prepaid or College Savings Plan.
It’s a new year and although the diet and exercise might be physically challenging, practicing good financial habits doesn’t have to be. Learning more about where and how much you’re spending may help you make better financial decisions overall, which could assist you in saving for other things like your child’s future college education or specialized training.
Most states offer a 529 prepaid or savings plan that not only offer tax-free withdrawals on qualified expenses, but most offer some sort of state tax benefit as well. Learn more about these plans at the College Savings Plan Network’s website www.collegesavings.org
*Taken from “10 Items to Add to Your Financial Bucket List” U.S. News & World Report, December 31, 2014
About the Author:
Jodi Golden is director of the Indiana Education Savings Authority, which oversees the Indiana CollegeChoice 529 Savings Plans. Under her leadership, Indiana has experienced an over 900% increase in both the number of Hoosiers saving and the amount of Hoosier assets in the plans. Indiana offers a Direct and Advisor 529 Investment Plan, as well as recently adding FDIC-insured Certificate of Deposit products. Golden currently serves on the communications committee of the College Savings Plans Network.