Regaining a sense of normalcy means starting with assessing the main areas of your personal financial management for a detailed look at where you are doing well and where you have room to improve. TCU’s financial experts weigh in on actionable steps you can take right now for a meaningful impact:
Planning – The First Step
“We are committed to understanding the current financial challenges that our community members are facing and the creative ways in which we together can solve them,” says Cynthia McGuire, vice president of Consumer Lending. “We start with planning, which is to ensure you’re on the path to a healthy financial future. Because your income doesn’t determine how successful you are; your choices and priorities do.”
“My advice is to reassess your retirement goals,” says Michael Gradl, vice president, Travis Financial Services. “There are two main components of retirement planning – saving and income. How do you know how much to save now, and how much you’ll need? Identify your sources of income – could include social security, pension, retirement accounts, investment income, personal savings – and determine how long they will last. The rule of thumb is, you’ll need 60-70 percent of your income at the time you retire.”
Saving With A Purpose – Is Your Plan Strong?
The sudden fall into an economic recession revealed that while many Americans were not financially prepared to deal with unemployment, their biggest regret was not having enough in savings going into the pandemic (Clever COVID-19 Financial Impact Survey).
“We save, basically, because we can't predict the future,” says Nav Khanna, executive vice president of Travis Credit Union. “Saving money can help you become financially secure and provide a safety net in case of an emergency. A good rule of thumb is to ensure you have at least three months’ salary in a liquid saving vehicle at all times, so a cash withdrawal is easily accessible. Your savings should also include categories to help reach your dream goals of paying for things like student tuition, vacations, new cars, etc.”
Spending Within Your Means – Is Your Current Debt Under Control?
“For many people, spending is an area that could be improved with up-front planning and daily discipline,” advises Dena Rothman, senior vice president/member-experience chief retail officer of Travis Credit Union. “A great strategy is to create a weekly budget that rolls up to a monthly budget. Spending less than what you make is the goal. It may take a few months to figure out the right dollar allocation, but well worth the effort. If you plan your spending and implement the necessary discipline to stick to it, you can reduce financial stress, increase your savings and eventually realize a financial dream you may have.”
Borrowing Responsibly – Is Your Credit Good?
“Your FICO Score will be the most powerful currency you have,” says Nathan Cox, senior vice president and chief lending officer of Travis Credit Union. “The higher your score, the more you control your ability to own a home, buy a car or get a job. A few immediate steps you can take towards improving your score include the following: checking your credit report for errors, paying your bills on time, reducing the amount of debt you owe, and keeping your balances low on credit cards and other revolving credit.”
It All Starts With You!
In gaining back control of your finances — instead of trying to change everything all at once, start with small steps that will give you the motivation to keep going, while reducing your anxiety about your financial situation.
“Our role in financial wellness is helping our community build towards financial peace of mind by planning for the future, saving for now and for later, spending within one’s means and borrowing responsibly,” said Barry Nelson, president and CEO of Travis Credit Union.
Celebrating 70 years of People Helping People in 2021, TCU’s Awesome Cause was created to change lives and lift communities through financial wellness. For more free financial education resources, tools and opportunities, please visit traviscu.org/awesomecause.
Headquartered in Vacaville, California, Travis Credit Union is a not-for-profit cooperative financial institution serving those who live, work, worship, or attend school in Alameda, Colusa, Contra Costa, Merced, Napa, Placer, Sacramento, San Joaquin, Solano, Sonoma, Stanislaus, and Yolo Counties. Currently, Travis Credit Union is the 14th largest credit union in California with more than 217,000 members and more than $4.2 billion in assets.