Unplanned expenses happen to everyone.
There are just some things in life we can't avoid.
Car repairs, home repairs, health care costs, or even a
once in a lifetime trip opportunity.
These, we really can't control, but we can control how we
prepare for the unexpected, and yes, it is possible.
SpringLeaf Financial is back to explain, and I want you to meet
Julie Vernol, Vice President of SpringLeaf.
Good morning.
Thanks for having me.
No, thanks for being here.
So let's talk about these dreaded unexpected expenses,
which really put a burden on the entire household when it
happens.
Oh, it does.
It really does.
It's stressful on the budget, and it stressful personally.
And it happens at the worst times.
It does.
I'll tell you what, my first experience as homeowner, first
winter in the house, young single woman, heater breaks
down.
I called the repairman.
He came out.
He gave me a quote of like $8000.
I said "oh my goodness."
He talked to me like I didn't know what I was talking about.
I knew darn well that I was about to get ripped off, so I
educated myself and I learned how to talk the talk and the
next estimate I got went down, and then I got another estimate
and the estimate went down.
Being informed about what you're purchasing, up front, can be
really helpful, but when an unplanned expense comes up, you
have to move quickly and you already have that luxury.
Now, I always kind of was brought up with "always have the
rainy day fund."
It's important to have it.
It's really great to have it right there next to you, but a
lot of people will say, "you know what Olga, I don't make
enough to save."
What do you say to that?
It sure would make life easier if I had six months worth of
salary tucked away.
My mother always told me that also.
That's very daunting.
Where do you start to get six months worth of salary?
What I have to say about that is take it $10 at a time.
Every person can find $10 that they're not using in the best
way and move that to their savings.
Whether it's cutting out your morning coffee, or looking at
your finances and maybe calling the cable company, and the phone
company and asking them to reduce their bills.
If you've got credit card bills out there, consolidating them
into one loan, reducing the interest rate.
That will increase your cash flow, and then you can put that
money towards savings.
So, it can be daunting to think about the large number that you
need to get there, but it's one step at a time.
You know, SpringLeaf financial, we have on our website, a lot of
tools that teach people how to budget, but one of my favorite
is actually a budgeting tool that walks you through
step-by-step to put your expenses in and put your income
in, and at the end you can play with it and get it to where you
want to be.
And let's talk about health savings accounts.
They're really getting more popular today.
They are, and if you're not taking advantage of it, or
you're not aware - You should!
You should, and ask your employer about it.
It allows you to save money for your health spending, tax-free,
but also, it gives you a cushion.
You are saving money so that when you need it, whether it be
to cover an unplanned health expense, or to help live a
healthy lifestyle, it's available for you.
And Julie, what about if I'm doing business with someone
that's offering me financing?
Good idea?
Not a good idea??
It can be.
It sure does seem convenient, doesn't it?
It does.
It seems convenient, my refrigerator broke, I'm at the
store.
They offered me some financing, maybe 90 days, same as cash,
even.
Well, there's questions that you need to ask before thinking it's
a great deal.
Sounds real good, but what's the rate after those 90 days?
What if I don't pay it off?
So, understanding what those financial options really are is
quite important, and also having a loan option in your back
pocket, having an established relationship with a financial
institution is helpful because then you're not feeling like
you're stuck with just the one option.
So the bottom line for women out there who are, let's say single,
or they could be widowed or they could be living paycheck to
paycheck, or they may not have that rainy day fund that makes
it so much easier, what's your advice to them?
Know the credit system so that you're prepared to take a loan.
Understand how your credit score and your credit report affects
the interest rates that you'll receive and also what you can
qualify for, and make sure that you take time to budget.
Budget, very important.
Let's see, perfect planning makes planning perfect.
That's what my mom used to tell me.
Thank you so much, Julie.
And, if you want to learn more, log onto the website
TheBalancingAct.com.
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