Understanding How to Save Money Responsibly

UNDERSTANDING HOW TO SAVE MONEY RESPONSIBLY MAKE A BUDGET HOW TO START • Keep track of your necessary expenses, like rent and utilities • Don't forget to factor in bills that you only pay a few times a year • Write down your extra expenses, such as entertainment, shopping, etc. HOW TO SAVE • Look at how much you spend on extras each month • Decide how much you want to save, and figure out where to cut back IE. • Even cutting back on buying coffee every day can help you save MORE BUDGET TIPS INCOME EXPENSES Remember that your expenses should be less than your total income • Put the money you save aside in a special savings account • Make a plan of how to spend and stick to it consistently INVEST IN YOUR RETIREMENT HOW 401(K) PLANS WORK • A 401(k) is an employer-sponsored retirement savings plan • Money is taken out of your paycheck before taxes are taken out TAXES 401(K) • Your taxable income is therefore lower, so your |% taxes are, too MATCHING PLANS • Many employers match part of your contributions to your account %24 24 • Matching contributions may vary from 25-100% of your contribution • If you cash out early, you may lose the amount your employer matched CHANGING JOBS No matter what, the money you've put into your 401(k) is yours • Cashing out early leaves you subject to taxes and a 10% penalty • Rolling your current 401(k) into your new company's plan or an IRA is a better move than cashing out Infographic provided by: GCS GCS Credit Union www.mygcscreditunion.com CREDIT UNION Sources: http://www.dailyfinance.com/2013/12/17/401k-basics-explained/ http://www.practicalmoneyskills.com/personalfinance/lifeevents/bene fits/401k.php http://www.consumer.gov/articles/1002-making-budget#!what-to-do http://money.cnn.com/magazines/moneymag/money101/lesson2/