10 things that adult should know

I teach a three credit course called Personal Finance
 at Rutgers University. Unfortunately only a small fraction of students at Rutgers and other universities receive any formal education in money management. Below are “cliffs notes” for those who leave school without learning about personal finance.Budgeting
1. Create a Spending Plan (Budget)Track your monthly income and expenses and “tweak” the numbers until cash flow is positive (income greater than expenses). Use thisStudent Budget Calculator
 from Bankrate to get started.
2. Learn to Use a Checking AccountCompare bank and credit union accounts for students. Reconcile your checkbook register with print or online statements and avoid fees for low balances and out-of-network ATMs.
3. Pay Bills on TimeUse a calendar and/or e-mail or text message alerts to keep on top of bills for car insurance, utilities, credit card balances, etc. Better still, pay bills promptly when they first arrive.Credit and Debt
4. Don’t Borrow What You Can’t RepayOutstanding debt ties up future income, costs money (interest and/or fees), and can cause physical symptoms of stress (anxiety, insomnia, etc.).
5. Double the MinimumIdeally, plan to pay credit card bills in full. If you can’t, pay at least double the minimum amount due to save on interest and cut the repayment time. For example, doubling the minimum payment on a $1,000 balance on an 18% APR credit card will save $399 in interest and four years of payments.
6. Compare Student Loan Debt to Future EarningsFinancial aid counselors recommend not borrowing any more than the expected first year salary for the career that you expect to have after graduation.
7. Know Your ScoreCredit scores are based on data found in credit reports. Credit reports are like a “report card” with detailed information about credit use while credit scores are like a “GPA” with a single number between 300 and 850 that tells how you are doing. For a free credit report, seeAnnualCreditReport.com
.Saving and Investing
8. Be Future-MindedSet financial goals with both a dollar amount and time deadline. Then calculate the required savings. For example, to have $1,000 for spring break in 40 weeks requires $25 of weekly savings. Use this financial goal worksheet
 to “do the math.”
9. Pay Yourself FirstFrom every dollar you earn, save at least a dime (10%). Automate your savings through direct deposit, payroll deduction (e.g., 401(k) plan), and automatic transfers from a checking to a savings account.
10. Save Early and OftenTake advantage of the awesome power of compound interest. For every decade that you wait to start saving for a financial goal, the amount you need to save approximately triples. For more information about saving, visitAmerica Saves


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