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Preparing for a Big Expense

Preparing for a Big Expense

Even with life’s joyous occasions, like a wedding or expecting a child, saving money will always be a common denominator. Although living on less to prepare for the future isn’t easy, planning and a positive attitude are key to your success.

Budgeting Basics

Financial planning begins and ends with a realistic budget. If you haven’t reviewed your goals, assets, income, expenses, and debt in a while (or ever) now is the time to do it. This is your opportunity to analyze when and how you spend your money — and make positive decisions about what you want to change.

Once you have an accurate idea of where your money is going each month, take a good, hard look at it. Are there areas you can reduce or eliminate? Tracking your expenses is a great habit to get into — you’ll probably find lots of “money leakage” areas that can instead be deposited into a honeymoon account or a child’s education fund.

Smart Shopping

Consider every purchase — Do you need it? Do you need it now? Can you get it for less somewhere else? Asking yourself these questions will help you become a savvy shopper. Consider cutting entertainment costs by renting videos rather than going to the movies. Or take advantage of the movies available on the cable or satellite you already pay for. Eat at home rather than going to restaurants — even fast food is often more expensive than a home cooked meal. If you do go out, try eating at cheaper restaurants or take food out rather than eating in the restaurant to save on tips and drinks.

Planning for the Big Day

Whether you’re planning to get married this year, or just want to stay prepared for your big day on the horizon, it’s a good idea to start thinking about the costs sooner than later. The reality is weddings can get expensive — and fast. Don’t stress, check out these common wedding costs and how to save on them:

  • The date: When it comes to planning a wedding, the date can be all-important. Weddings during the middle of summer or on Valentine’s Day tend to be on the more expensive end of the spectrum. By contrast, weddings that are planned for the winter months can often be quite a bit cheaper. For extra savings, check dates on Fridays, Sundays, or even during the week.

  • The flowers: Floral arrangements form an important part of any wedding, but they can be quite expensive. Speak with your florist about only using in-season flowers for the wedding, as this should save you quite a bit of money. A good florist will be able to tell you which seasonal picks will go best with your color scheme.

  • The dress: For many brides, the dress is the most important part of the wedding. To avoid spending thousands of dollars on the dress at a boutique bridal store, consider visiting prom shops, department stores, or vintage or second-hand outlets. Many of these retailers will have beautiful or unique dresses available at a fraction of the price.

  • The photographer: Photographers can take up a large percentage of your overall cost. Consider limiting their hours at the event. For example, if you think a talented friend or relative could do a good job of shooting the reception after the wedding, then you will only need to hire a photographer for half the day.

Planning for a Family

You planned the baby shower and painted the nursery, but are your finances in order? Get ready for one very adult-sized number: $233,610. That’s how much it now costs to raise a child, according to a recent government study. The total is actually up from previous years, which means having kids probably won’t get cheaper any time soon. To make sure you’re ready to support your bundle of joy, check out these effective tips for organizing your finances:

  • Confirm your job’s leave policy: If you’re employed and plan to take time off for your newborn, check your company’s leave policy. The Family and Medical Leave Act (FMLA) grants all parents 12 weeks of leave, but not all employers offer compensation during this time. Find out if you can expect a salary while you’re out, and plan accordingly.

  • Start saving now: The earlier you start saving, the better. In addition to a crib, stroller, and diapers, you’ll also need money for food, toys, and, if you plan to go back to work, childcare. You’ll want to avoid piling on credit card debt if possible.

  • Scope out discounts: When it comes to certain baby items, hand-me-downs may become your best friend. Do your family and friends have any clothes or gear they no longer need? Also, find out about parent groups in your community, and see if they have a garage sale. A gently used item might save you a bundle for your bundle.

  • Cut housing costs: Housing was the biggest expense, according to the study. If you’re struggling to find a home you can afford, or if your monthly mortgage payments consume a huge portion of your income, consider alternatives. Move to a more affordable neighborhood (i.e., away from a city) or, if necessary, try refinancing your mortgage.

No matter where you are in life, Nusenda Credit Union is here to help. Now is a great time to talk about your financial plan for now and the years ahead. We can help you come up with ways to set a budget, build your savings, and save money. Make an appointment to visit with us today, use our comprehensive set of financial calculators and financial library, get complimentary financial education and counseling with BALANCE Financial Fitness, and follow us on Facebook and Twitter for more great tips all year long.