2018-07-13 / Front Page

Learn to stay on track financially

Laura Levering
Fort Gordon Public Affairs Office

Saving money may seem out of reach for some, but according to one financial advisor, it is not. All it takes is some planning, discipline, sometimes sacrifice, and of course money.

William Stratford, Fort Gordon PenFed Credit Union branch manager, believes everyone should and can put money into a savings account, regardless of financial status. They key is to save early and save regularly. Saving accounts are important to have for emergencies, major goals or purchases, and retirement.

“All of the sudden, the air conditioning at my rental goes out, and I have to come up with $4,100,” Stratford said. “If it weren’t for the emergency fund that I have – that I didn’t always have because I’ve made some mistakes – what would I do?”

Set short-term, medium-term, and long-term goals. Make a chart and write down what you want to do or where you plan to go over the next week, six months, two years, and five years. Short-term goals might include holiday gifts or vacation, medium-term might be purchasing a car or down payment on a home, and a long-term goal should include retirement.

Cover immediate needs, such as bills, with emergency and reserve savings. For major purchases, create an account specifically for that item or event.

“Don’t mix bill money with a down payment for your next car,” Stratford said. “Open a separate account to save for it.”

Pay cash whenever you can, but do not be afraid to open and manage a credit card account. The average interest rate on a credit card is 18.5 percent, so unless you pay off all credit card debt on time, you end up losing money by paying an interest rate.

Despite credit cards charging interest rates, not all cards are bad. Some companies offer incentives including introductory 0 percent rates or cash back rewards. And since credit scores are considered by lenders when making a big purchases such as a house or car, responsible credit card usage can benefit you in the long run.

“It’s not bad to get a car loan at a reasonable rate, and it’s not bad to have a credit card,” Stratford said.

“It’s bad when that debt gets out of hand, so you don’t want to look at your credit card as emergency savings because if you don’t pay it off every month, then you’re paying interest on that purchase.”

Develop a financial plan for retirement. For those in the military, the default monthly investment plan is the Thrift Savings Plan. Stratford said the TSP is a good investment because unlike some others, it will never lose money.

“It’s automatic, it’s systematic, and you don’t even see it in your paycheck,” Stratford said. “And if you’re eligible and switch to the new Blended Retirement System, then you’ll get a match.”

Stratford acknowledged that saving and investing can be overwhelming; especially for those who are just getting started. But it can be done. Start small, cut back where you can, and seek financial counsel.

“If you go to a coffee shop every day or convenience store for an energy drink, it adds up quickly,” he said. “Add that up over time, and that’s your entire years’ worth of contributions. Buy in bulk instead.”

The Financial Readiness Program, Army Community Service, offers free financial classes, advice, and counseling. To make an appointment or to learn more about upcoming classes, call (706) 791-3579.

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