SOLDIER & FAMILY TOOLKIT 1/34 ARMORED BRIGADE COMBAT TEAM Volume 36, March 2015
The Emergency Fund Issue Time to get tough financially 1
IN THIS ISSUE 3 BEYOND THE YELLOW RIBBON EVENTS & DEALS 4 TAX PREP FLYER 5 TAX REFUND PLANS 6 EMERGENCY FUND 101 7 45 WAYS TO BUILD YOUR EMERGENCY FUND 9 HEALTHY MONEY HABITS 11 RESOURCE LINKS 12 FAMILY ASSISTANCE CENTERS Thanks for reading our Soldier Family Toolkit. The intent of this toolkit is to provide you with available events, deals, resources, and important information. This is our second annual Emergency Fund Issue. According to FINRA’s 2012 Military Financial Capability Study, only 54% of military members have rainy day funds. This is a pretty sad number. Even worse, according to CNN Money, 76% of Americans live paycheck to paycheck. People surveyed said they simply didn’t have enough money to set aside for savings. That is quite ironic, because according to USA Money, the average American throws out $529 in wasted food, loses $400 in gambling, spends 1% of there income on alcohol, $1,092 on coffee, and spends $1,200 per year on fast food (Daily Mail). For a Family of 4 on a $50k income, that equates to $8,000. Their article also gives figures for wasted energy, speeding tickets, tobacco products, unused gift cards, unused gym memberships, and premium cable. Thanks for reading.. 2
HOME FRONT EVENTS & DEALS www.BeyondTheYellowRibbon.org Check out the Beyond the Yellow Ribbon website and sign up for exclusive email updates on monthly local Beyond the Yellow Ribbon events and deals. Complimentary Business Coaching for Veteran Businesses When: Any convenient Date/Time Where: Your Business About: AdviCoach has a passion and commitment to helping military and veteran business owners achieve success and meet their business and personal goals. They offer a complimentary 90 minute coaching session, to learn about you and your business, to determine how they can help your business survive and thrive. More Info: Flyer Minnesota Military Radio Hour When: Radio show airs on over 21 stations throughout the state at various times on Saturdays and Sundays About: With a team of producers from the MN National Guard, Department of Veterans Affairs, and Minneapolis V.A., volunteer host and Vietnam veteran Tom Lyons strives to inform and entertain listeners in this weekly syndicated radio and podcast. More Info: Times and Dates of the Broadcast Hotel Discounts for Military and Public Service Workers When: Now through Dec. 30, 2015 Where: Participating hotels in Duluth About: To honor those who serve, several hotels in Duluth are offering a special discount to Servicemembers and public service workers. All hotels offer a complimentary breakfast, highspeed Wi-Fi, a fitness center and extended stay rates for 7 days or more. *Excluding the Edgewater which has a hot breakfast buffet for a minimal charge. More Info: Flyer Spirit Mountain Season Passes Enjoy a season of skiing and snowboarding! Spirit Mountain in Duluth is offering discounts on season passes to Servicemembers and veterans and has recently announced it will now offer lift ticket discounts to all active Servicemembers. There are also other season pass options for families and college students. More Info: Website
Operation Freedom on Ice When: Register now! Event will take place on March 7, 2015 Registration: Call Tim 651-395-9424 or email opfreedomonice@gmail.com Where: Cross Lake, Pine City About: To thank members, past and present, for their service and for protecting the Nation's freedom. All proceeds go to BTYR to support our military and their families before, during and after deployment. More Info: Flyer MN Timberwolves Recognizes Military Youth - Registration When: Register now! April 1, 2015 and April 15, 2015 Where: Target Center, Minneapolis Who: Military connected youth, ages 6-15 years old About: Come out and celebrate our Military Children and Youth and enjoy the Timberwolves game. The Minnesota Timberwolves recognize the contributions and sacrifices made by military kids and have invited them to be a part of their pre-game activities. More Info: Register Online Event Details Free Tax Preparation for Military Families When: Now through April 15 Where: By phone, email or at a local CPA's office Who: SMs that are currently deployed or were deployed during 2014 About: Certified public accountants (CPAs) have volunteered to prepare tax returns free of charge for qualified military personnel. Contact the MN NG Family Programs office at 651-268-8204 to receive a referral. More Info: Website Congressional Art Competition When: Enter today through April 24, 2015 Where: Check out their website for specific guidance. About: Each spring, the Congressional Institute sponsors a nationwide high school visual art competition to recognize and encourage artistic talent in the nation and in each congressional district.
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Think of a Tax Refund as an interest free loan that a person is giving the IRS or think of it as a savings account with a negative rate of return. An easy way to get a monthly raise is to divide your refund by 12 and reduce your withholding accordingly. Always check with your tax professional before making financial decisions. What do you do if you have an unplanned tax bill this year instead of a refund? 1. Get a second opinion. Make sure that you are using a qualified tax professional that is familiar with the nuances of military service and taxes. 2. Now may be the time to put off some big purchases or perhaps dip into your emergency fund. If you don’t have an emergency fund or want to increase it , see page 7 for strategies to build your emergency fund. 3. Talk with your tax professional about adjusting your withholding going forward so that you won’t have a tax bill next year. 5
What is an Emergency Fund? Just like disability insurance, there are two kinds of Emergency Funds, short term and long term. Rainy days happen, so it is important to be prepared. If you don’t have any savings, perhaps your first goal is to set aside $500 or $1,000. This is the money that will keep your electricity from being turned off. If you aren’t behind on your bills or deeply in debt , most experts recommend having an emergency fund of 3-6 months in place in order to protect against things like a medical event or job loss. Emergency Fund Considerations If one or more of the income earners in your home lost their jobs or were injured or unable to work, how much money would it take to meet the bare minimum expenses for the household? That number is the minimum Emergency Fund a family should have in place. How much would it take to maintain your current lifestyle? That would be the high end of what an Emergency Fund should be. Examples Two examples of situations where emergency funds are very helpful are car accidents and childhood illnesses. In the case of a car accident, insurance doesn’t necessarily cover immediate expenses related to missed work, medical appointments, and car replacement. While many adults have disability insurance to buffer the financial effects of an illness, most people don’t have the same coverage for their children. When a child is sick, parents may need to take unpaid leave from work and medical and related expenses can add up.
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1. Temporarily skip Christmas/ Vacation/… Look at some of the more expensive events during the year and consider skipping or scaling back on them for a year. 2. Trade with others. I needed lots of D Batteries (baby swing, flashlights), my friend had lots of Ds, but needed AAs & AAAs (remotes). I had lots of those, so we swapped. We both felt like we were getting a fantastic deal.
HEALTHY MONEY HABITS 45 WAYS TO BUILD YOUR EMERGENCY FUND
3. Review and adjust your insurances. This may or may not help, but is a good habit anyways. 4. Trade services. This comes in very handy with childcare, but can be used for plumbing, electrical, auto work, lawn care,… Let’s say you have a friend that is a plumber with small children. You could ask him to stop by to fix something and bring the kids with while you watch them. In return, you offer a restaurant gift card (you got for Christmas) and you’ll watch the kids during their date night. I heard of a gal that brought dinner to her pediatrician’s house once a week in exchange for their kids’ medical care. 5. Shop with grocery list, or try last month’s grocery challenge. 6. Get a better paying job, either in different employment or through a promotion. (EPS packets anyone?) 7. Sell a car. WHAT??? Yep. I have done this more than once. We have sold the “extra” car more than once. We also sold the vehicle with a payment to free up monthly cash. We sold our paid for gas guzzling truck to build up savings too. We are a one vehicle family. It is a pain, but one month, our gas & full coverage insurance on our 05 Matrix was under $200 and we drive 30 miles to work round trip. 8. Pay off debt, this will free up your cash flow for saving. 9. Use your gift cards. A lot of gift cards go unused. Dig through drawers, find them, and use them up to meet your needs for the month instead of cash and put the difference towards your E fund. 10. Reduce interest rates. Try to transfer balances on a credit card or refinance a car loan (better yet, sell the car). Look into refinancing your mortgage as well. 11. Get student loans on hardship deferral. This is not a long term plan, but if you can’t pay your bills, it can help free up some cash for the short term. 12. Consider moving. WHAT??? Yep. I am doing this as well. Sometimes, a house or rental situation just isn’t affordable. And if you look hard enough, you may find something that is better and cheaper and may free up some equity during the sale to better fund your savings. 13. Get a part time job. Walk your neighbor’s dog, babysit, deliver pizza, whatever it takes. 14. Go back to school. If this is part of your plan anyway and the military provides compensation above tuition, this could be a strategy. 7
15. Shop clearance racks, especially on big purchases (better yet, avoid big purchases!). 16. Return some gifts. Sometimes we receive gifts that we really don’t need (sweaters, socks, …). 17. Have cereal for dinner one night a week (assuming you are getting good deals on cereal). 18. Stay-at- home parents can make $200 a week or more watching an additional child. 19. Clean out your kitchen cupboards and sell what you don’t need (Quesadilla maker,...)
HEALTHY MONEY HABITS 45 WAYS TO BUILD YOUR EMERGENCY FUND 30. Get a programmable thermostat.
20. Sell books on your bookshelf. This can be especially lucrative in college.
31. Sell scrap metal, aluminum cans, …
21. Sell a piece of furniture. Maybe your sectional couch is too big.
32. Close an old bank account.
22. Analyze your pet expenses and figure out ways to cut back.
33. Cash in a change jar or start one.
23. Shop at thrift stores and garage sales.
34. Host a freezer meal exchange.
24. Get rid of your gym membership.
35. Become a do-ityourselfer.
25. Don’t buy bottled water.
36. Deliver flowers on
26. Quit drinking soda.
Valentine’s or Mother’s Day.
27. Quit drinking alcohol.
37. Join a grocery sharing program or start dish one.
28. Consider a less expensive hair care routine. 29. Consider selling a collection (coins, stamps, baseball cards). 39. Sell plants. If you have too many perennials in your garden, thin them out and sell/trade them.
Good Housekeeping
38. Start a part-time kids’ clothes flipping business, picking them up from garage sales and selling them online.
40. Rent a room or your house on airbnb.com. I am hoping to do this during a festival weekend. 41. Sell firewood. If you have an extra tree(s) that you don’t want, have someone pay you for them. 42. Sell unused jewelry (at a jewelry store, not a gold buying place). If you don’t have any, consider asking a relative if you can help them clean out their jewelry drawer and offer to bring the broken/used jewelry to the store and split the proceeds. 43. Sell extra tools in the garage. How many drills does a person really need? 44. Get a roommate. This could cut down your housing expenses dramatically. 45. Sell unused sporting equipment (treadmill, old figure skates) 8
HEALTHY MONEY HABITS FINANCIAL GOALS FOR 2015 March brings the first quarter of the year to a close. Most people make goals in January about weight loss and finances. How are they going? I am not a big fan of weight loss goals, but love financial ones. It is way too cold in Minnesota in January & February to go to the store or the gym. It is, however, a great time to do tax paperwork and take a look at your finances over the last few years and think about where you want to be in the next few years. Most people get frazzled doing this because they try to do the numbers and the goals at the same time. Those are activities that use different sides of your brain, which basically causes it to melt down. This combined with normal frustrations couples face can lead to big arguments. One solution is to focus on the goals themselves first and then put the numbers to the goals at a separate meeting. We hit several road blocks goal setting and dreaming, so to get through the conversation, we broke it down into smaller bites over several days. The first conversation was about our lives just before and after death. Morbid, I know, but we have had several of our grandparents pass away and/or need long-term care. We didn’t like how the situations were handled and both agreed that we didn’t want to be a burden for our children and grandchildren and we also agreed that we wanted lots of them (hence why we are expecting baby #3). Not being a burden, we agreed, meant having the financial assets to pay for all of our end-of-life care and leave an inheritance that others could use to make the world a better place. The next conversation we had was about retirement (age 70). What did we want that to look like? Where did we want to live? What do we think our streams of income are going to be? We were certain on some things like being able to watch the grandkids play hockey and less certain on other things like MN winters. The next few conversations, life at age 60 & 50, were a bit harder to figure out. We just knew that we didn’t like where our parents were at and we wanted to be on a different track. The age 40 conversation was easy for us because we knew the kids would be in high school/jr. high and we could visualize it. Then, we started to nail down a rough picture of what the next ten years would like. I, being the nerd, made a spreadsheet that showed everyone’s grade in school and other fixed milestones. It was pretty strange to see the next twenty years on a single piece of paper. That helped us figure out our goals for the next year, like refinancing and having another baby. The big goals have helped us breakdown smaller monthly goals like save for a bigger car and replace windows. Once we knew our goals, we could put numbers to them, like put $200 into savings for the new car this week, or start saving for new windows. Having goals helps us cut back on expenses and motivates us to make better choices, like not eating at McDonald’s (as much). One of our newest strategies has been to put money in savings first and then figure out the other things next. It helps us decide what is really important and what can wait. By taking a “not right now,” instead of a “not at all” approach, we have been able to wait and see if we really want it and save up for it. Now that the year is almost a quarter done, it is time to really get serious about financial goals and make some progress. If you have further questions, don’t hesitate to reach out to one of our Personal Financial Counselors in the State. 9
HEALTHY MONEY HABITS GENERATING CASH QUICKLY Our First Emergency Fund The week our first child was due, was the first time we really had to use our emergency fund. We were patching the ceiling of our kitchen and learned the hard way that glass top stoves aren’t for standing on. The oven had already been on its last legs and we had to prop the door shut and it only opened halfway. Our refrigerator decided it was a freezer that week and was having issues as well. I was very excited when I heard the shattering sound, because we could finally get new appliances. The problem was that it was noon on a Saturday and the appliance store closed at two. Another issue was that our debit card had a $600 limit, so we also had to use cash on hand. The cashier had a story to tell that night. In walks a 40 week pregnant woman, covered in drywall dust and paint, crying (tears of joy), and paying for a fridge and stove with one dollar bills. The baby arrived before the fridge and was a nice welcome home gift.
When I started this column, I wanted to practice what I preached. Too often, I have read financial columns by people that were obviously not doing what they were writing about. Personal finance is very personal. It takes self-discipline, something most Americans like myself are sorely lacking. One of the best things my husband and I ever did with our finances is to start an emergency fund. Before we had one, we lived from one financial crisis to the next, now those things are merely annoyances, and sometimes pretty funny. While we have an emergency fund in place, we have found ourselves in need of additional money outside of our normal budget to cover some large upcoming expenses. Our goal for February is $2,000. We set aside a certain percentage of our income each month towards savings. This month, that will be $700, leaving $1,300. Here is our path to get there. First $400 1. Emptied a Change Jar $20 2. Sold savings bonds $330 3. Closed an old checking account $50 Second $400 1. Sold our unneeded baby gate $30 2. Sold some gift cards to a family member $60 3. Got some Menard’s rebates in the mail $110 4. Returned some things at Menards $40 5. Sold unused cloth diapers $160 (I thought using them would save money) Remaining $500 1. Sold a train set ($20), floor mat ($10), and toy cars ($10) on Craigslist $40 2. I redeemed my Huggies rewards points for a gift card that I will sell $15 3. I am going to redeem some of my frequent points for a Target gift card $25 4. Current Craigslist postings $490, more to be posted this weekend. As of the date this goes to print, we are still short of the goal, but we hope to meet the goal by the end of the weekend.
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ARMY / NATIONAL GUARD minnesotanationalguard.com armyonesource.com militaryonesource.mil
RESOURCE LINKS
CHILDREN ADAPT: cehd.umn.edu/fsos/adapt operationwearehere.com mnchildcare.org ausa.org/family mdva.state.mn.us/child guardfamilyyouth.org militarykids.org DISCOUNTS beyondtheyellowribbon.org military.com/discounts/category EDUCATION education4military.com gibill.va.gov militaryonesource.mil militarychild.org EMPLOYMENT esgr.org mn.gov/deed FMLA: dol.gov/whd/fmla HEALTH / MENTAL HEALTH tricare.mil militarymentalhealth.org Counseling 24/7: militaryonesource.mil MARRIAGE AND RELATIONSHIPS Marriage Retreats: strongbonds.org militaryonesource.mil PARENTS OF SOLDIERS bluestarmoms.org operationwearehere.com/Parents.html PET CARE dogsondeployment.org netpets.org guardianangelsforsoldierspet.org SPOUSES & SIGNIFICANT OTHERS militarysos.com spousebuzz.com milspouse.com msccn.org nationalmilitaryspousenetwork.org STRESS MANAGEMENT militaryonesource.mil defense.gov/specials/stressawareness
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