It's Going to Cost What to It's Going to Cost What to Live Off Campus????? Live Off Campus?????

Presented by Presented by Lauren E. PigottLauren E. Pigott

Green River Community CollegeGreen River Community College

&&

Micheal K. SeraphinMicheal K. SeraphinWillamette University Willamette University

NWACUHO 2011 – VancouverNWACUHO 2011 – Vancouver

Goals of the ProgramGoals of the Program

• Interactive

• Active Participation– Discussion– Sharing of experiences

• Walk away with a plan

In the old days a man who saved money was a miser; nowadays he's a wonder. ~Author Unknown

About UsAbout Us

• Left first live-on job before finding a new one

• Huge credit card debt when between jobs

• Recovering shopaholic

• Recently paid off huge debt

• Inspired by colleagues

About UsAbout Us

• Lived on for 5 years, and while I currently live off campus, I live in University owned house, but paying rent.

• “Doing my part to help the economy”

• Enabled by my parents - “Money is no object”

• Strings attached

• Got tired of STUFF

All About You…Part IAll About You…Part I

• Why did you attend this session?

• What are your financial goals?

• What do you want to learn more about?

What’s the big secret?What’s the big secret?

Sorry, I can’t go, I am saving for a

vacation.How much do I take home each pay period?

Maybe another time, I am

working to lower my debt.

Build a BudgetBuild a Budget

• Determine your priorities:

-Putting money in the bank

vs.

-Paying off debt

• Choose something you will use!

Tips from Gail Vaz-OxladeTips from Gail Vaz-Oxlade

1-Gather all your paperwork

2-Use your online banking wisely

3-Save automatically

4-Create a monthly bill summary

5-Make a date with your money

6-Talk about your highs and lows

Budget TemplateBudget TemplateHousing 35%Life 25%Debt 15%Transportation 15%Savings 10%

Lauren’s adjusted template Weekly Bi-Weekly Monthly

Life 35% 188.5 377.00 754.00

Debt 25% 133.75 267.50 535.00

Transportation 5% 29 58.00 116.00

Savings 35% 198.75 397.50 795.00

100% 550 1100.00 2200.00

Housing 35%Life 25%Debt 15%Transportation 15%Savings 10%

Do the mathDo the math

• What will work for you?

• What are your fixed expenses?

Housing 35%Life 25%Debt 15%Transportation 15%Savings 10%

Still not sure?Still not sure?

• Look at your spending from the last couple of months….

Where did it all go?

• Build your budget around your real spending.

Groceries     Restaurants     Entertainment     Clothing & Gifts  

amount date amount date amount date amount

Walmart 48.45 Greek 18.88 Regal Cinema 15.00 Kohls 195.32

Walmart 32.60 Arbys 12.01 JANUARY total 15.00 Amazon 40.69

Trader Joes 42.16 Wendys 3.62 usps.com 32.25

Walgreens 2.69 Olive Garden 44.46 Amazon 25.26

Walmart 212.08 Ihop 28.40 mystery? 38.61

Grocery Outlet 20.70 Arbys 7.87 Merrell 335.00

Ranch 99 7.37 Wendys 4.60 Chukar cherries 53.25

Walmart 50.89 Greek 21.67 usps.com 15.25

JANUARY total 416.94 Lemonade 2.81 Groupon-haircut 25.00

Wendys 10.70 Haircuts 24.95

JANUARY total 155.02 Dollar Tree 12.05

Auburn shipping 27.95

Online watches 4.00

Living Social-Amazon 10.00

Harry and David 9.04

usps.com 4.75

JANUARY total 853.37

Budget Building OptionsBudget Building Options

• Mint.com-if you feel comfortable giving your bank account info

• Go old school-create paper files & keep receipts

• Switch to cash only-use a log and/or jars for each category

• Create your own tracking system

Another SampleAnother Sample

Credit Cards, Scores, and Credit Cards, Scores, and Reports…oh my!Reports…oh my!

Credit CardsCredit Cards

• How many do you have? Why are they important?

• What one thing has brought you the most amount of debt?

• How much debt do you have?

Credit Card TipsCredit Card Tips

-Pay down the balance with the highest interest rate first

-Call regularly to ask for an interest rate reduction

-Keep only 2-carry 1!

-Stay away from retail store cards

Credit ReportsCredit Reports

• Order one annually…for FREE. U.S. www.annualcreditreport.com Reports from “the big 3”:

Experian, TransUnion, Equifax

Canada: Equifax Canada, TransUnion Canada &

Northern Credit Bureaus Inc.

• Go through each line-print out and save.

The key to the right helps explain the payment history information contained in some of the accounts below. Not all accounts will contain payment history information, but some creditors report how you make payments each month in relation to your agreement with them.

TransUnion

Credit Scores cont.Credit Scores cont.• Ways to check your credit score

– www.myfico.com• You will have to pay to get your score

• How is it calculated? (Range: 300-850)

35% — Payment history

30% — Credit utilization – The ratio of current revolving debt to the total available credit.

15% — Length of credit history

10% — Types of credit used

10% — Recent search for credit – Credit inquiries, which occur when you are seeking new credit, can hurt your score

Institutional Retirement Plans: Institutional Retirement Plans: How do they work? How do they work?

• % deducted

• % matched

• Allocations

• Growth

• Withdrawals*

• Moving jobs• (WU Paystub Example)

A little becomes a lot…A little becomes a lot…• Me - $68.90 (plus my mandatory $34.45) • WU - $344.50• Total invested each month = $447.85 and I am only

responsible for providing 15% of that

• My TIAA-CREF Allocations– Mutual Funds– Life-Cycle Funds– Inflation Funds– Mid, Small, and Large Cap Stocks

• My money grows with the market/indexes

““But I can’t afford it!”But I can’t afford it!”

• Fact vs. Reality– Real costs– Debt reduction– Spending habits– Free money– Time

All About You…Part IIAll About You…Part II

• Do you participate in your institutions retirement plan?– When did you start

• Do you have money saved?

• In what ways have you set money aside?

• What’s your goal for retirement?

Ways to Save MoneyWays to Save Money

• Savings Accounts

• Roth IRAs

• CDs

• Mutual Funds

The Rule of 72The Rule of 72

• The "Rule of 72" is a rule of thumb that can help you compute when your money will double at a given interest rate. It's called the rule of 72 because at 10%, money will double every 7.2 years.

• To use this simple rule, you just divide the annual interest into 72. For example, if you get 6% on an investment and that rate stays constant, your money will double in 72 / 6 = 12 years. Of course you can also compute an interest rate if you are told that your money will double in so-and-so many years. For example, if your money has to double in two years so that you can buy your significant other that Mazda Miata, you'll need 72 / 2 = 36% rate of return on your stash.

• Like any rule of thumb, this rule is only good for approximations.

ExerciseExercise

How much do you want to have saved by the How much do you want to have saved by the time you are 50 years old?time you are 50 years old?

Using the “Rule of 72”, and assuming a 6% Using the “Rule of 72”, and assuming a 6% return rate, what is the MINIMUM amount of return rate, what is the MINIMUM amount of money you can put aside in 2011 to achieve money you can put aside in 2011 to achieve

that goal?that goal?

SHHH…Here is a secret about SHHH…Here is a secret about student loans if you don’t know this student loans if you don’t know this

already….already….

Planning to move offPlanning to move off

• Furniture• Rent

-deposit, first/last• Utilities• Cable/Internet• Transportation Costs• Cooking/Kitchen

Save specifically for this!

How much?

Ways To Increase WealthWays To Increase Wealth• Quit or reduce “money wasters”-like Starbucks &

cigarettes

• Walk (it reduces the amount of gas you use)

• Reward yourself (within reason) for meeting your monthly goals

• Reduce the amount of times you eat out or use that board plan!

More Ways To Increase WealthMore Ways To Increase Wealth

• Pay down your credit cards-aggressively!

• When grocery shopping, always use a list!

• Make a list of everything you need or want-have a plan before you leave the house.

• Save!

Some things to remember…Some things to remember…• Pay yourself first

• Pay more than just the minimum payments– Pay aggressively on the card with

the highest balance.

• Participate in your institutions retirement plan – it’s less expensive than you think

• Plan ahead

• Have an emergency fund

People first, then money, then things – Suze Orman

Questions? Questions?

Enjoy the rest of the conference! Enjoy the rest of the conference!

The safe way to double your money is to fold it over once and put it in your pocket. ~Frank Hubbard

ResourcesResourcesGail Vaz-Oxlade http://www.gailvazoxlade.com

Till Debut Do Us Part

Bierman, Todd and Nathaniel Wice. The Guerrilla Guide to Credit Repair: How to find out what’s wrong with your credit rating – and how to fix it

Draut, Tamara. Strapped: Why America’s 20- and 30-Somethings Can’t Get Ahead

Orman, Suze. The 9 Steps to Financial Freedom

www.cnnmoney.com

www.tiaa-cref.org