This informative and entertaining seminar will show you how to take control of your finances by learning to budget your paycheck - before you spend it.

1. The POWER of
PAYCHECK PLANNING
www.credit.org
Promoting Financial Literacy

2. About Springboard
 Springboard is a non-profit
organization founded in 1974.
 We offer personal financial education
and assistance with money, credit, and
debt management through educational
programs and confidential counseling.

3. About Springboard
 Accredited by the Council on Accreditation
(COA)
 Member of the National Foundation for
Credit Counseling (NFCC)
 Certified by the Department of Housing and
Urban Development (HUD)
 Member of the Better Business Bureau
(BBB)

4. Our Services Include
 Credit and Debt Counseling
 Financial Education Programs – Seminars
and Materials
 Debt Management Plans
 Homeowner Assistance (Foreclosure
Prevention)
 First Time Home Buyer Education Seminars
 Reverse Mortgage Counseling
 Pre-Bankruptcy Budget and Credit
Counseling
 Pre-Discharge Financial Management
Instructional Course

5. Introduction
 Surveys show that only 12% of high school
seniors learn about money management in
school.
 Historically, it has been up to parents to
teach their children the skills needed.
 Most of us learn these lessons the hard way
after we’ve moved out on our own and made
some mistakes.

6. First Steps
 Stop incurring new debt
 Live on a cash basis
 Get a handle on your situation
 Relax

7. What is a Budget?
A budget (spending plan) is a plan to
figure out where your money goes
before you get it.

8. Where to Begin When Creating
a Budget:
 How much do you earn?
 How much do you spend?

9. Track Your Spending!
 Track ALL spending
for at least 90 days
 Write down even the
smallest expenditure
 Transfer expenses
to the monthly
tracking sheet to
summarize and view
by category

10. Daily Tracking Sheets
 Use the forms provided
in this book or
 Carry a small notebook
 Keep your receipts in a
separate envelope for
each day
 Use software like
Microsoft® Money or
Quicken® (chances are
you already own one of
these applications if you
own a personal
computer)

11. Tracking Sheet for Monthly
Expenses
 Housing
 Food
 Insurance
 Medical
 Auto
 Child Support
 Taxes
 Personal
 Savings

12. Creating Your Budget
 Three things you need to know:
 Income
 Expenses
 Goals

13. Track All Your Sources of Income
 Job
 Spouse’s job
 Part time job
 Rentals
 Commission/bonuses
 Child support/alimony
 Investments

14. Categorizing Your Expenses
 The two most important categories of
expenses are needs and wants.
 Necessary expenses are your needs.
 Discretionary expenses are your
wants.
 The rule to bear in mind is this: Anything that
is necessary for you to earn a living is a
need.

15. Necessary Expenses
 Housing (include utilities, taxes,
insurance)
 Food
 Insurance (medical/dental/life)
 Medical
 Transportation (include car insurance)
 Child care
 Taxes
 Savings

16. Discretionary Expenses
 Personal care, clothing, jewelry
 Entertainment (include cable TV!)
 Miscellaneous
 Pet care
 Gifts
 Cell phone
 Cigarettes/Alcohol
 Charitable giving
 Internet access

17. Periodic Expenses
 Insurance premiums
 Taxes
 DMV registration
 Gift giving

18. Debt Payments
 Credit Card Payments
 Personal Loans
 Student Loans
 Any Other Debt Payments

19. Debt Repayment
 After you divide your necessary from
your discretionary expenses, you aren’t
done categorizing your spending.
 This usually takes the form of credit card
bills, though auto loan repayments and
personal loans would also count.
 Take each debt and figure out a monthly
payment amount that will allow you to
pay off your debts as quickly as possible.

20. Debt Repayment
 For your auto loans, this is your established car
payment.
 For your credit cards, don’t just send the
minimum monthly payment; if you do, you’ll be
paying toward that debt for the next 30 years.
 For example, say you owe $6000 on a credit card.
Over four years, or 48 months, you’d pay $125 per
month to wipe out the debt. If that amount is too large
for your budget, you can adjust the payoff term to
something longer, like 5 years. (Then you’d only have
to pay $100 per month.)
 Whatever you do, though, don’t stretch out the payoff
term so much that you’re just making minimum
payments.

21. Setting Goals
 A short–term goal should be accomplished
within one year.
 A mid-range goal takes between 2 and 5
years to accomplish.
 Long-term goals take over 5 years to achieve.

22. Goal Strategies
 Competition
 Cooperation
 Attempts
 Don’t be too
Flexible

23. Adding It All Up
 Now it’s time to put everything together and
see whether your budget will work.
 Remember, your short, mid and long term
goals should be included with your expenses
on your budget.
Total Necessary Expenses
+ Total Discretionary Expenses
+ Total Debt Payments
= Total Monthly Expenses

24. Now Let’s See if Your Budget
Balances
Total Monthly Net Income
- Total Monthly Expenses
= Surplus (+) or Deficit (-)

25. If Your Expenses Exceed Your
Income
 Work to find solutions
 Credit counseling can help if you have high debt
payments that are upsetting your budget.
 Whatever you do, don’t cut into the 10% - 15% you
should be saving; you need to save up to three – six
total month’s of expenses to get through an
emergency
 Re-evaluate your budget periodically, especially
when your income or needs change.

26. What Your Spending Should Look Like
 Housing 35-45%
 Utilities 8-15%
 Food 10-20%
 Transportation 15-25%
 Medical 8-15%
 Clothing 3-5%
 Personal & Misc. 5-10%
 Savings 5-10%
 Monthly Installments 10-20%

27. Monthly
Budget
 Now that
you’re more
familiar with
your income,
expenses, and
goals, it’s time
to propose a
monthly
budget.

28. Balancing that Budget
 Continue to track spending for another 30-60
days to plug budget “leaks”.
 Wants vs. Needs – know the difference!
 Ask before you buy: “How did I get along
without it?”
 Plan ahead and curb those impulse buys.
 Include your family in budget discussions

29. Budget Busters
 Food
 Dine out too often
 Five times more expensive than making it yourself
 Grocery shopping
 Entertainment
 Impulsive nature of it
 Movies - #1 entertainment outlet
 Retail Shopping
 Paying too much for things
 Buying what you don’t need
 Shopping as a form of entertainment

30. Increasing Income and
Reducing Expenses
 Make sure you control your money, not the
other way around
 Rework your budget as needs, priorities,
income, and expenses change
 Try some of these tips to reduce expenses for
 You and Your home
 Your phone
 Your transportation
 When grocery shopping

31. Shopping with Coupons
 Coupons can be a valuable tool to help
consumers save money at the grocery store.
 But coupon shoppers have to be careful;
coupons can be advertising devices designed
to get you to purchase high-priced name
brand items that are still more expensive than
the brands you normally buy.

32. Where Do You Get Coupons?
 Wednesday and Sunday • Sunday paper, except
before holidays
 Grocery store coupons on flyers, mailer coupons,
 Coupons enclosed in products.
 Magazines
 Boxes
 You can also find coupons online:
 Couponcabin.com
 Ebates.com
 Keycode.com
 Ecoupons.com

33. Shopping Smarter
 Planning ahead can
make the difference
when retail
shopping.
 Use the calendar
as a rough guide
for when to find
seasonal sales or
discounts

34. Serious Spending Issues –
Compulsive shopping vs. Impulsive shopping
 10 signs of Compulsive shopping
 To relieve anger or depression
 Spending disrupts normal life
 Conflict with loved ones
 Lying to family & friends
 Feelings of elation
 Taking cash from others – purchasing on your own
credit card
 Feels like something forbidden
 Guilt or shame
 Purchase never unwrapped or used
 Purchasing on credit for items wouldn’t spend with cash

35. Your Credit Report
 The FACT Act of 2003 mandated that the
three major national credit-reporting bureaus
establish a website, a toll-free number and a
mail address for consumers to request their
credit report for free every year:
 *You may also purchase your score at this
website for a small fee.
 www.annualcreditreport.com
 877-322-8228

36. Getting Your Report
 If you’ve been denied credit because of what
your credit report says, you are also entitled
to a free copy of the credit report used in the
decision - within 60 days of the denial.
 Contact the credit bureaus directly
 Equifax – www.equifax.com
 Experian – www.experian.com
 TransUnion – www.transunion.com

37. Opt Out of Prescreened Offers
 If you would like to stop receiving offers
of new credit you may Opt Out.
 www.optoutprescreen.com
 1–888-5OPT OUT

38. Thank You!
Springboard Nonprofit Consumer
Credit Management
www.credit.org
800-947-3752
4351 Latham St. Riverside CA. 92501 www.credit.org