While it still seems early in the year to me, I must admit the days are going by in a hurry. Of course each day brings us one day closer to spring, which means warmer weather and longer bike rides. Those of you who come to my educational programs or read my columns know that I am passionate about topics related to health and wellness. Today I want to talk about another type of health – that is financial health.
If ever there was a year to drive home how important saving for emergencies is, the past year wins the prize. The sudden loss of income linked to COVID-19 caught people off guard. Businesses closed or reduced operations, leading to job losses or smaller paychecks for many in our communities.
The last week in February is designated as Kansas Saves Week. This coincides with a national campaign America Saves. This is a great time to think about goals and consider setting, or renewing, a savings goal.
A fact sheet titled, “Spend Some, Save Some, Share Some: Family Budgeting” has good information to help you get started. Elizabeth Kiss, our Extension Specialist in the area of Financial Management, and author of the fact sheet, shares advice in key areas of your spending plan. She recommends spending no more than 25 percent of your income on housing and save a least 10 percent of each paycheck. It is also wise to put aside at least three months living expenses in a rainy-day fund. If possible consider contributing 10 percent of your income to your faith-based community or some other cause.
The idea of a budget often conjures up ideas of sacrifice or doing without. It doesn’t have to be that way. A budget, also called a spending plan, is a guide for how you will use your money over a specific period of time to meet your goals. Of course, to be most useful, it needs to be as realistic as possible. Events of the past year may have influenced your spending plan and created the need to adjust your plan.
When it comes to saving, you will need to determine what works best for your household. Many people have found that having a certain amount transferred automatically from each paycheck into a savings or investment account is the most effective way to save. Having clear goals for what you are saving for will help keep you motivated and you will be surprised at how quickly you can reach your goal.
Feel free to stop by my office, give me a call, or send an e-mail if you would like to receive the fact sheet, “Spend Some, Save Some, Share Some: Family Budgeting.”
Donna Krug is the Family & Consumer Science Agent with K-State Research and Extension – Cottonwood District. Contact her at 620-793-1910 or dkrug@ksu.edu.
