Financial Counsel From a Banker!

My younger brother John and his wife Nancy along with our mother, Esther came over tonight for a visit through Sunday afternoon. Already had some great laughs!

Nancy is a banker and I thought a few tips from her would be good for all us. Here are some of her thoughts:
1. The media says there is no money to lend but that is not necessarily true. There are many banks that have money to lend!
2. It is a buyer's market right now which means if you can afford it, now is the time to buy a home or even a small business. You will get your best bang for your buck now.
3. Things are more realistic now because the ‘bubble has burst.’ You are not paying for the bubble any more. In other words homes and properties all over were just too high priced!
4. Pay down all consumer credit! Pay down your autos unless they are zero interest (so that would be last thing to pay off). Start with your highest interest card and work on that big time.
5. You need an emergency fund (slush fund). If you own a home you will have to repair stuff like water heaters, air conditioners and DO NOT BORROW FOR THAT! DO NOT PUT STUFF LIKE THIS ON CREDIT! This is the beginning of the end for people who begin to descend into debt.
6. After you pay stuff off then put that same amount away (ear mark that money!) so when you get ready for a new car (they do wear out!) you can pay for it in cash!
7. Buy end of season stuff and you get incredible deals (sometimes 75% off). NEVER SETTLE FOR FULL PRICE! For example if you have kids buy summer clothes at the end of summer and so on!
8. She thinks Americans will start swapping services more—she thinks we will be bartering & networking more with others. For example a mechanic may do some car work for a CPA who will prepare his taxes for free, etc.
9. With your employer set up a pre-tax flexible spending plan. Take advantage of this if you can. In other words, ask them if they will offer it and look at your out-of-pocket medical expenses including some over-the-counter medicines and then ear-mark that amount to be taken out of your payroll check. You will save some tax money and have more out-of-the pocket money returned. Let’s say it’s $600.00 a year you spend on medicine, etc. Have your employer deduct $50.00 per month pre-tax from payroll. Then they can reimburse you as your expenses come due.
10. Check out this excellent web page “Cheapskate.com”
11. If you need to speak to Nancy you can email her at ngrogan@farmersstate.com

As always, I want you to go farther than me. Love you tons, Papa G.