Three simple steps to move toward financial freedom
DAYTON, Ohio (WKEF/WRGT) - The new year brings with it new hope and for many across the country; the hope of being able to financially plan for their future. We spoke with with a financial expert to break down three steps people can take to move toward making their financial goals a reality.
Carrie Cook Bray with Buckingham Financial Group says the biggest hurdle for a person, is that first conversation.
"People are often scared to talk about it with friends or family or even seek professional advice," Cook Bray said. "So they do wait and put it off."
Bray says after that honest conversation, the first step is figuring out a budget. Write down what money is coming in and what's going out. Some expenses aren't flexible like your car or your house, but others can be.
"How much you eat out, how many clothes you buy," Cook Bray said. "Those are items you can actually cut back a little."
Once you figure out how much extra money you have each month, the next two steps involve tackling debt and building your savings. And here's what might surprise you.
"Don't wait to pay off your debt before you start saving for your future," Cook Bray said. "They can often run concurrently."
That means if you discover you have an extra 100 dollars for instance, try to put half into savings and the other half toward erasing debt.
For David and Carrie Scott, financial planning is a lifestyle. They have a daughter who's almost 2 and just welcomed a baby boy in February. Both of them work and have student loan debt. But have figured out ways to save for the present and the future.
"Whether it's five dollars or 100 dollars, I like to put that aside for any big issues that may arise," David said. "I try to make sure when I want something, say a TV or a pair of shoes, I'm not depending on a credit card. I'm able to pay with cash. That way it reduces or eliminates the amount of debt we carry."
"We put a little bit of money from each paycheck in and so when you don't see it, it adds up," Carrie said.
Cook Bray says the Scott's strategy of limiting or eliminating the credit card is a great idea if possible. That way you're spending what you have and can pay down debt without adding more.