Lesson 39: Fiscal Responsibility

The economic climate is cautiously optimistic as the stock market starts to climb again, but what does this change for us?  Frankly, not much.  The work paycheck stays the same. Prices for food and gas continue to climb. Luxuries are a want and not a need. Optimally, you should be saving 10% of your paycheck for the future - in a retirement plan, interest-bearing account, or if nothing else, your piggybank.  It's not just for a rainy day anymore.  The time has passed where you can count on anyone, but yourself to support your future.

Make a budget for yourself using a spreadsheet (see below for samples of what you bring in financially and what you spent it on).  Compare what you bring in to what you spend.  See where you can cut back so that you have a little more financial input than output.  Take that extra money and put it in your company's 401K/403B, an IRA, bonds, etc. based on what is conservatively paying the most for your money.  This is a not a time to be risky. If you have the opportunity to make 10% on your money and the bank is only paying 1%, be wary...be very wary.  Get rich quick schemes rarely work and may actually be illegal. Buyer beware is very important! 

Include all financial input (samples provided below):

• Gross Salary
• Stocks/Bonds distribution
• Tips/Bonuses
• Gifts
• Sale of goods
• Refunds

Include all financial output (samples provided below):

• Federal Tax
• State Tax
• City/County Tax
• Income Tax
• Social Security
• Healthcare Insurance
• Life Insurance
• Home/Apt Insurance
• Car Insurance
• Car Payment
• Gas
• Food (groceries)
• Clothes
• Sundries (medications/hair care, etc.)
• Entertainment (shows, restaurants, bars)