Thursday, 16 April 2009 13:45
by
Andy M
During these economic times, it can be easy to look short term and not see the longer term ramifications of financial actions you may take. Try to avoid these potential pitfalls or at the minimum talk to a financial advisor who can help you navigate your troubled financial times. Mistake #1: Stop talking to the lender if you fall behind on paymentsIt is critical if you are behind on payments that you attempt to establish a dialogue with your lender and look for creative ways to get through your situations. Many times lenders are looking for good faith efforts and plan that is feasible to correct the situation. The worst scenario for both parties is to stop talking about options. Mistake #2: Stopping 401k contributionsDon’t stop 401k contributions as the first option in improving your cash flow. Look for ways to reduce your monthly expenses first. If you need some of your 401k deductions, try to stay at or above the match rate so that you can at least gain that advantage. Stopping 401k deductions can have serious long term financial ramifications. Mistake #3: Hide your money in the mattress syndromeDon’t get completely eliminate all risk in your portfolio because you also eliminate all chances for greater returns in the future. Working with a planner can help you overcome these concerns and find an appropriate plan that fits your risk tolerance. Mistake #4: Not developing a budgetFind out where you are really spending your money and then set goals for how you will change your budget to match what you want to achieve. If you need help, check out our SaveItUp challenge. A wealth of resources are available to you on this page as well as ideas and offers to save you money. The budget is a key tool in managing these difficult times. Without it, it would be very difficult to really understand where realistic savings can occur. Most of all, remember that you are not alone. Your credit union is willing to help you with budgeting, financial planning and any other financial need you may have.