Money Boo-Boos and How to Correct Them

Financially Fit is a column published by RCB Bank to help you gain knowledge on all things financial. Fitness guides – RCB Bank ­professionals in the field – offer ideas to help you strengthen your money sense, customize savings training, and provide quic

Refinancing your home can save you money, says RCB Bank Mortgage Specialist Jenalee Mitchell (pictured here).

Get a handle on your finances in 2013. Are you wasting money? We’ve compiled a list of money boo-boos that could be costing you your hard-earned money. RCB Bank loan officers Matt Streeter and Michelle Miller offer their advice on how to ­correct the mistakes.

1.    Not making a budget – or attempting to stay near it. Sit down and really look at your monthly expenses, Miller ­suggests. Where might you be able to cut? Just looking at where your money actually goes is a ­great tool to saving. “That $1.50 coffee doesn’t seem like a lot at the time until you realize cutting it can save $350 a year,” she says.

2.    Not building an ­emergency fund – Any savings is better than no savings. Matt Streeter says your annual bonus, tax refund or a small amount each month is a great way to start. “You just have to start ­setting it aside,” he says. Miller adds, “It is easier to save if you have the money automatically deducted from your paycheck or main checking account.”

3.    Not paying your credit cards off each month – “It’s like tossing your money out the window,” Streeter says. “Money spent on interest charges and late fees can add up fast. After ­interest, how much did that sweater you bought with your credit card really cost?”  

4.    Living above your means – Carrying a balance on a credit card can become crippling if it gets out of hand. A better ­solution is to have a special account that you use for “extras,” says Miller. Make a pact with yourself to set aside a small amount every paycheck. “Ideally you save up the cash and you don’t need to use credit; ­however, no interest financing for large ticket items can be a good alternative. As long as you can pay it off in the free time allotted,” Miller says.

5.    Impulse buying – “If you can’t give yourself a day to think about a purchase, that’s an impulse,” says Streeter. “Even worse, if you put that impulse buy on a credit card.” If you find yourself in this situation, back away and go home.

6.    Not reviewing your ­insurance needs annually – or at least every two years. This includes auto, homeowners, life and others. “Your employer and insurance companies review it each year, so why don’t you?” Streeter asks. Shop around ­occasionally to see if there’s a better deal.

7.    Not having a retirement plan – “Everyone should start saving for retirement as early as possible,” says Miller. If your employer doesn’t have a 401k program, open an IRA. Even $10 a paycheck can add up over the years.   

8.    Housing expense exceeds 30% of your gross income – If your housing expenses are more than 30% of your gross income, you should consider scaling back, suggests Miller. “Today’s economy is tough, and if you exceed this ratio you are ­vulnerable to serious financial problems with any disruption of wages or family emergencies.”

Additional tips:

Everyone makes bad money decisions from time to time. The key is to recognize them when they happen.

Share your goals and concerns with family, or a friend. They may have a solution that worked for them that could also work for you. They can also help hold you accountable for your goals.

Make a list of three achievable financial goals. Example: set up an auto transfer to your savings account; bring lunch from home instead of eating out every day; or consider adjusting your cable/internet package.

    RCB Bank is an Oklahoma-owned and operated community bank with 30 convenient ­locations stretching across Oklahoma and into Kansas. Founded in 1936, RCB Bank is committed to serving its communities with conservative banking practices and progressive banking products like its newest feature for the iPhone app – mobile deposit – which allows approved users to deposit checks using their iPhone. For additional information, visit us online at www.RCBbank.com or like us on Facebook. Member FDIC.

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