Jun 02, 2016 / Money Tips

Real Talk: The Money Management Questions You Don’t Want to Ask

Talking about money isn’t always easy. But sometimes a little real talk is all you need to get the answers that will help you get back on your financial feet.

So, let’s have some real talk. Here are the questions that some of us are too shy to ask, but really want to know the answers to.

“I’m struggling to keep up with my credit card payments. How can I pay off my debt?”

If you have more credit card debt than you can manage, the first thing to do is stop increasing your debt. Put your credit cards in a safe place and fund your regular spending with your primary checking account.

Next, decide how you’ll tackle the task of reducing your debt. The two most popular ways to pay off debt are the snowball method and the stack method. Here’s how they work:

• Snowball Method – Pay the minimum payments on all your credit card bills except the smallest one. Pay as much as you can toward the smallest bill. Once it’s paid off, start putting as much money as possible toward the next-smallest bill. Follow this method until all your credit card bills are paid off.
• Stack Method – Choose the credit card bill that has the highest interest rate and focus on paying it off. You’ll still make the minimum payments on your other bills in the meantime, of course. Once that bill is paid off, select the one with the next-highest interest rate, and so on.

You can also pay off your debt by getting a little help from a debt consolidation loan, especially if most of your credit card balances have high interest rates. A debt consolidation loan can help you combine several credit card payments into one lower monthly payment. Plus, it streamlines your money management process and could help your credit score improve as you pay off portions of your credit card debt.

“My credit score is lousy. Can I still qualify for a car loan?”

Yes, you can still qualify for an auto loan even if your credit score isn’t ideal.

Your credit score is just one of several factors that lenders look at when you apply for a loan. For example, Utah First will also consider your length of employment, income, and other existing loans. Remember, the requirements for getting approved for a secured loan, such as a car loan, are more flexible – so don’t be shy about trying to get that set of wheels.

If your credit score isn’t sky high, you can increase your auto loan options by opting for a longer-term loan, making a larger down payment, or reducing your highest credit balances. Read our post about How to Get a Car Loan with Less-Than-Perfect Credit to learn more.

“Can’t I just worry about my retirement savings later? My retirement years are so far away.”

1 in 3 Americans has $0 saved for retirement, so you’re not alone if you’re in this boat. You should try to board another boat, though – like one that’s heading toward a financially secure retirement.

Saving for retirement should be part of your money management no matter how young you are. Why? Because putting away even small amounts now will pay off big by the time you hit retirement age. If you start now with consistent contributions to retirement funds, the interest will help your money increase over time. Plus, you’ll have peace of mind knowing that you can spend your retirement perfecting your golf game rather than stressing about finances.

If you’re not quite ready to start a retirement fund, open a money market or term deposit account. Both offer high interest rates that will help you build up your savings faster.

“I just lost my job and I need to make ends meet. What can I do?”

Before you kick off your job search, devote a few hours to some money management. Look at your expenses and cut out all costs that aren’t necessary so you can stretch out your remaining money. Then estimate how long you can live off the funds you have. Financial experts recommend keeping 3-6 months of living expenses in your savings account.

Not sure that you have enough saved? Job searching can be expensive if you aren’t careful, so make sure to keep yours as low-cost as possible: leverage free career and networking resources in your area, avoid searching in coffee shops, and resist the urge to splurge on designer suits. For more wallet-friendly job search tips, read Financial Firsts: Find Your First Job Without Going Broke.

“I don’t track my finances. Is that really so bad?”

Well, it’s not great. Tracking your finances is the crucial first step to successful money management. Creating – and sticking to – a personal finance budget helps you to cut back on unnecessary spending, increase your savings, and build your credit more effectively.

Tracking your finances also keeps your money safe. If you track regularly, you’ll be able to spot and report any suspicious or fraudulent transactions. You’ll also be more on top of due dates and payment amounts, so you can make sure that you aren’t paying bills late and getting hit with late fees.

Remember, tracking doesn’t have to be a hassle. Use your Utah First mobile banking app to view all your financial information in one place, even accounts that you may have with other creditors or lenders. You can categorize your spending, set financial goals, and sign up to receive important alerts about your accounts. How’s that for easy money management?

See, that real talk wasn’t so bad, was it? If you have more questions, our financial experts are just a phone call away. We’re here to help you find the answers and get back on your financial feet.