5 Steps to a Stronger Financial Future

credit union los angeles, financial future plan, camino federal credit union We want you to have a strong financial future.  In fact, we are committed to helping our members achieve their financial goals and support them along the way with the products and services we offer.  But what steps should you take to get there?  It can often seem overwhelming to think about the future, especially when you start thinking about money.  To help, we identified five steps everyone can take to improve their finances.

Don’t Ignore Your Money

Money can be stressful and confusing.  Whether you feel you aren’t making enough money, have too much debt, or simply don’t have time to deal with it, we get it.  Fortunately, it doesn’t have to be stressful and confusing.  The best way to get a handle on it is to address it head on and if something doesn’t make sense or you don’t know what to do, look for advice.  With countless blogs, books and websites, the answer is out there, you just need to do the research.

Create a Budget

Having a budget is one of the best things you can do for your financial future.  Knowing how much money you make and how much your fixed expenses are will let you know how much disposable income you truly have.  To start on a rough budget, look back at the previous month and see how much money you actually made (money that was deposited into your bank account).  Next, add up your bills that you have to pay every month.  Lastly, add up all the money you spent in addition to your bills (meals, entertainment, etc.). If your expenses are more than your income, you need to cut back somewhere, or you need to make more money.  Just doing this exercise will help you understand how much money you truly are spending.

Minimize Debt

Debt is unavoidable.  Whether its student loans, car loans or a mortgage, taking on some form of debt is usually necessary.  With that said, avoid bringing on too much debt, especially credit card debt.  Credit cards can be great for paying for larger purchases that you don’t have the money for immediately, but it’s important to keep the balances low on those credit cards.  If you do need to use them, try to pay the credit card off every month.  If you can’t pay it off in a month, make a plan to pay it off as quickly as possible.  It’s easy to just make the minimum payment, but interest on that can add up quickly, costing you a lot more money in the long run.

Know Your FICO Score

Knowing your FICO score will allow you to take steps to improve it.  If your credit history includes late payments or high credit card balances, it might be lowering your FICO score.  This could make you less attractive to lenders, who use this information to determine your ability to repay the money they are lending you.  The higher the risk, the higher the interest rate you will get, costing you more money.

Save Money

Start with an emergency fund – ideally 2-3 times your monthly expenses.  From there, start putting away money in an IRA or an employer sponsored retirement plan (like a 401k or 403b), especially if your employer offers a contribution match on some of those funds.  If at all possible, max out your yearly contribution to your retirement plan.  Make saving money a habit and something you do every month.  Whether it’s a set dollar amount or a percentage of your income, make it happen.  Even just a little money every month can add pretty quickly over time.


If you have additional questions or are interested in knowing how we can help you create a stronger financial future, give us a call at 800-835-3400.  We would love to answer your questions and help you on your financial journey!

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