Bringing financial transparency home

June 3, 6:32 PMConsumer News ExaminerBroderick Perkins

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Home economics need transparency too

You really want to get your financial house in order?

Quit whining and perform the necessary due diligence on your home economics.

The National Foundation for Credit Counseling (NFCC) says if you want to be part of the new culture of financial stability you need a renewed enthusiasm about regaining control of their financial future.

Here are NFCC's 'Top Ten Financial Basics' necessary to make it so.

1. Open your bills the day they arrive. Ignoring the problem won't make it go away. Knowing what you are up against, facing the facts and developing a plan will.

2. Review monthly creditor statements thoroughly. Don't just open those statements, read tem. Check their statement for unauthorized charges indicating ID theft, rate changes, credit limit changes, additional fees and other items that need your attention. Contact the institution immediately if necessary.

3. Pay bills on time. Late fees can cost $40 or more. Late payments can ding your credit score by as much as 100 points. Set up automatic bill paying if you are a procrastinator, travel, or unorganized.

4. Record each check you write and each ATM withdrawal, immediately. Over-limit and non-sufficient fund fees are as high as late fees. You'll even pay for the courtesy when your financial institution allows you to exceed your balance.

5. Don't max out your credit card limits. Using all of your available credit will cause creditors to view you as a risky spendthrift. Maintain a 70 percent or more credit limit balance. Credit card holders deemed risky get higher interest rates and lower credit lines.

6. Track your spending. Know where your money goes. If you don't know where your money goes, you have no idea where you can cut back. Set up a budget. Track your spending for 30 days, organizing the results by category. Put your spending in black (or red, if that's the case) and white.

7. Have at least one month's income earmarked for emergencies. Unanticipated expenses can wreak havoc on any budget. Without a rainy day fund, an emergency will force you to charge, grab cash from another payment due or go after one of those exorbitantly high check-cashing loans.

8. Have three to six month's income saved in the event your lose my job. C'mon, your grandparents did it. There could be a pink slip with your name on it. You won't get advance notice. Without a paycheck, cash is king. You're on a slippery slope if this is not a part of your overall financial picture.

9. Have an annual insurance check-up. Don't be over-insured or under-insured. Review your policies each year with your insurance agent. Understand exactly what is covered and what isn't. Ask for help for coverages you don't understand. Learn ways to save on your overall insurance costs without sacrificing coverage.

10. Develop a plan for tomorrow, and execute it. You need short-term and long-term goal plans. An example of a short-term goal is a summer vacation. Long-terms goals include, a college education for your children and your retirement. Your goals won't suddenly materialize without your help.