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Monthly Archives: May 2023
What to do if you’ve made a financial mistake
There are few feelings worse than when you realize that you’ve made a financial mistake. Whether you’ve splurged on something you shouldn’t have, forgotten to pay a bill on time, or worse, gotten scammed out of some money, that sinking feeling in your stomach is hard to shake. Financial mistakes are a hard topic to discuss because no one wants to discuss mistakes we’ve made with money. We’d rather share the highlights like our great investment or the vacation we got at a steal.
The truth is financial mistakes can happen to anyone, no matter your age or experience. But mistakes are an opportunity to learn so that next time, you’ll know how to react, understand, and recover from those financial mistakes. Below are seven steps to take if you’ve made a financial mistake.
1. Acknowledge the mistake
Let’s say you’re out running errands when you stumble onto a splurge-worthy purchase. It’s on sale and you think you’re in the clear, but soon you realize you’ve overdrawn your account. Now what?
The first step in dealing with a financial mistake is to admit you’ve made one. It’s easy in hindsight to see the warning signs, but it’s important not to beat yourself up. It’s tempting to think about what you should have done differently or wish you could turn back time, but doing so won’t change anything. Instead, make a plan so you can move forward and avoid future mistakes.
Back to our example—your first step is to acknowledge you’ve made a mistake so you can make things right.
2. Assess the damage
A financial mistake can make it feel like you’ll never be back on solid ground. That’s why it’s important to fully assess your current financial situation; it might not be as bad as you think. If you are in a relationship, you should discuss this with your spouse or significant other. By being open, you can both understand the pressures and will be able to work together to find the right solution.
If you’ve overdrawn your account, you’re probably dealing with a Non-Sufficient Fund (NSF) fee. Make a tally of how much is owed, including any additional fees, so you can properly resolve this mistake.
3. Freeze your spending
Once you’ve fully examined the issue, you may want to consider freezing your spending. Look at your monthly budget and see where you might be able to trim some expenses. Cut out any extras you don’t absolutely need, such as eating out, subscribing to multiple streaming services, or recreational travel. It might seem like a bummer, but it’s only temporary until you are financially stable again. In the meantime, you might find you prefer saving money to spending it.
4. Talk about it
Depending on the financial problem, you may want to seek the help of a relative, a friend, or a financial advisor. Remember, you can meet with a Georgia’s Own financial advisor at no cost and no obligation. Outside advice is important because they will provide you with perspective and ideas on how to resolve the problem. There’s nothing wrong with asking for help when you need it.
Additionally, it is important to break the stigma surrounding financial discussions. For a lot of people, talking about money is sometimes seen as taboo, especially if you’ve made a mistake. But talking about it helps others avoid the same mistake.
In addition to financial wins, tell your friends when that cool gadget you bought wasn’t actually worth it. If you feel like you’re constantly moving money around your budget, talking with a financial advisor may help you restructure your budget to better fit your needs, and help you avoid the constant struggle.
5. Determine your options and resolve the problem
Once you understand the repercussions, have had a discussion with your significant other, and talk to a trusted advisor, it’s time to look at all of your options to resolve the problem. When you’ve decided on your best option, make a list of action steps to ensure you accomplish everything needed to get you back on track. Then, it’s time to start checking things off that to-do list. Fixing the financial mistake will make you feel better and give you a path to go forward.
If you have the funds available, you may decide to transfer money from another account to cover any NSF fees along with your purchase. If you’ve really blown your budget, and you’re able to, you may want to return the item.
6. Learn from your mistake
Now that you’ve resolved your financial mistake, your mind is clear for you to fully examine why you made the mistake and what you can do to prevent it in the future. No one makes a financial mistake intentionally—sometimes we rush a large purchase without fully factoring the debt into our budget or we forget about an upcoming payment. Life, and mistakes, are bound to happen. But understanding how you made the mistake is critical to preventing it from happening again.
7. Plan for the future
Lastly, once the initial crisis has passed, it’s time to start planning for the future. Open and work toward fully funding an emergency savings account, set up as many bills as possible on auto-pay (so you can avoid late payments and fees), and regularly review and modify your budget as needed.
As long as you can still feed yourself and keep a roof over your head, chalk it up to a learning experience and use it going forward. The worst thing you can do is become so discouraged you give up, turning a temporary setback into a permanent one.
Moving forward, you have several options to keep you from repeating your mistake. Set up balance alerts to stay on top of your accounts, and consider setting up overdraft protection. You can also opt-out of overdraft protection so the purchase is declined, if that is preferable. Lastly, make sure you update and adjust your budget regularly.
- Mistakes can (and will!) happen to all of us. The best thing to do is acknowledge the mistake so you can learn from it.
- Assess the damage with your partner, and consult a trusted advisor to help find a resolution.
- Once you’ve resolved your financial mistake, create a plan to avoid future mistakes and fund an emergency savings account.
When you have a budget and a financial plan, you might be tempted to think everything should go smoothly. But that isn’t always the case—we all make a mistake from time to time. It never feels good to make financial mistakes, but it doesn’t have to be the start of a downward spiral. By acknowledging the mistake, creating options to resolve the problem, and discussing it, we create a path forward and action plan to actually fix the problem.
Wedding saving tips: What to do, what not to do, and how to budget
Wedding season is here, and for those couples on a budget, you may be wondering how to have a big day without spending in a big way. We have some tips on how you can create the perfect moment of matrimonial bliss without going over your budget (and maybe even while staying under it).
Consult the experts
By experts, we mean bridal magazines and websites. There is no shortage of resources available to you by professionals whose job it is to plan beautiful weddings for a small amount of money. Look for these tips and make a list of your own— compare and contrast ideas, see which suggestions pop up most often, and keep an open mind about solutions you might not have otherwise considered. A lot of the work is already done for you, courtesy of these publications, so get to Googling for the best tips.
Talk to your friends
The odds are high that you know of someone who has gotten married within the last year or two. This is the perfect chance for you to ask for their help. Neither of you has to share your budget if you’re not comfortable doing so, but they can give a better idea of current flower prices and which bridal salon is offering the best deals. They can also give you insider tips on locations and what they did to save their pennies beforehand. Everyone’s wedding has a budget—some of them may be large; others are small, but even the grandest wedding can be scaled down to fit your needs.
We don’t want to step on any toes but do take the time to consider your wedding day versus the rest of your life. While weddings are wonderful events, they are also the start to something much more wonderful: your marriage. Keep this perspective in mind as you make financial decisions for your big day. In ten years, will you still remember going with the less expensive catering service? If so, that’s okay—everyone has different priorities. But at the end of the day, the highlight for most couples is that they finally get to begin their lives together.
Choose a less popular day
Fun fact: Saturday evening weddings are by far the most expensive weddings. This is because Saturday evening is the most highly-desired ceremony time for many couples, and venues charge a premium for reserving these dates. Look for other options, like a Friday evening or a Sunday afternoon—this could save you nearly 20-50%. You can even take it a step further and get married in the middle of the week if you’re feeling really crazy. Be sure to avoid holiday weekends, as these also tend to drive up venue prices. Choosing a less popular day means choosing a less expensive day—and it all goes back to your budget!
Location, location, location
There are many gorgeous wedding venues in the area, but there are also a lot of equally beautiful options that don’t cost money to use. For instance, if some local friends have a large backyard, you might consider using it for either your ceremony or your reception. Do some research on how you could use your favorite park for your ceremony to keep the outdoor feel without the price tag. You can make any venue beautiful with some simple decorations, so look for the potential in each place you visit.
Don’t use so many fresh flowers
Flowers are wonderful and picking them out for your wedding is especially fun. Unfortunately, flowers are often expensive, too. Talk to your florist about adding a few fresh flowers to your bouquets and make the rest of them yourself out of silk flowers from your local craft shop. This combination will allow you to have a stunning look in your décor that keeps you well within your budget needs. Bonus: those silk flowers will last forever, which means you will get to keep your bouquet for as long as you want it. Or, if you don’t want to skip the fresh blooms, consider buying in bulk from a warehouse club and doing florals yourself.
If you have crafty friends, now is the time to call on them. Work together with your friends and wedding party to do some DIY projects as a group. You might be able to create your own invitations, make your own cake, and do your own makeup instead of paying a professional, which can add up to big savings. We know it’s a special day, so we aren’t asking you to break out a Betty Crocker box mix for your wedding cake—but you should consider looking for a local friend who could give you a break on the price of the cake if you choose a simple design.
Skip the limo ride
For many brides and grooms, it’s tradition to leave the reception in a big way. This might mean a ride in a limousine, or, if you’re super fancy, maybe a horse and buggy. Either way, consider skipping this step altogether to save a few hundred dollars. If you’re really set on not driving yourself to your post-reception destination, ask a friend to drive you, or look for a car service that offers options within your budget. Leaving in style is fun but having the extra cash to spend on your honeymoon is even better.
There are so many ways to make a wedding great without breaking the bank, so put on your thinking hat and look for creative ways to stay within your financial needs. Make a budget, decide which priorities are the highest for your big day, and plan to have an amazing, finances-friendly wedding that you will remember for years to come. But what should you do with all those savings? If you don’t already, consider opening a savings or Money Market account together, so you can get a head start on your financial goals.
How to secure your home network
You aim to keep your home secure, but are you keeping your home network open? A protected home network shuts out cybercriminals and allows your family to use the internet more safely. Having a secure network is crucial to keeping your personal and financial information safe. Wi-Fi doesn’t stop within the walls of your home—it extends further than that. If hackers are within range of your network, they can access your Wi-Fi and do a number of things to your connected devices, like spread malware or access personal login details. Learn how to secure your home network and safeguard your information:
Ensure your devices are updated
First, ensure all internet-enabled devices run the latest operating system, web browsers, and security software. This includes mobile devices that access your wireless network. Hackers are always looking for new ways to steal data, and keeping your software updated is an easy way to step ahead. If you don’t already, install software updates as soon as they’re available.
Secure your wireless router
A wireless network is when you connect an internet access point—such as a cable or DSL modem—to a wireless router. Wireless is now essential in many homes because it allows you to connect multiple devices to the internet from different areas of your home. However, if you don’t secure your router, you’re vulnerable to people accessing the information on your computer, freeloading off your internet service, and (potentially) using your network to commit cybercrimes.
How to secure your wireless router:
Change the name of your router
The default ID—called a “service set identifier” (SSID) or “extended service set identifier” (ESSID)—is assigned by the manufacturer. Change your router to a name that is unique to you and won’t be guessed by others.
Change the preset passphrase on your router
Keeping the router’s manufacturer default passphrase in place makes it much easier for hackers to access your network. Change your router’s passphrase right away. A strong passphrase uses at least 12 characters and includes letters, numbers, and symbols. The strongest passphrases are not recognizable words.
Review security options
When choosing your router’s level of security, opt for WPA2, if available, or WPA – these levels are more secure than the WEP option.
Create a guest passphrase
Some routers allow guests to use networks via separate guest passphrases. If you have many visitors to your home, it’s a good idea to set up a second network just for guests. A second network allows visitors to connect to your Wi-Fi without being able
Use a firewall
Firewalls keep hackers from using your device to send out your personal information without your permission. While antivirus software scans incoming emails and files, a firewall is like a guard, watching for attempts to access your system and blocking communications with sources you don’t permit. Your operating system or security software likely comes with a pre-installed firewall, but make sure you turn on these features.
Protect your account with these tips:
Even with a secure network, it’s still critical to ensure your account itself is protected.
Enable multi-factor authentication (MFA)
Whenever offered, use two-factor authentication or MFA like biometrics, security keys, or a unique, one-time code through an app on your mobile device.
Use long, unique passphrases
Your password should be at least 12 characters long with a combination of letters, numbers, and symbols. It should also be unique—avoid reusing the same passphrases you use for other accounts, like online banking or social media.
Your network extends beyond the walls of your home. So, just like you keep your home secure, it’s crucial to secure your network, too. This is part five of an 11-part series on cybersecurity and how you can protect yourself online in today’s digital age. For more educational tools and tips, visit our resource center.
Vendor security checklist: 20 questions to ask a security vendor
If you own a business, choosing a vendor to meet your cybersecurity needs is not an easy task, but it is an important consideration when it comes to safeguarding your customers’ personal and financial information. To help you, we have created this checklist with some questions you should consider asking current or potential vendors.
It is not exhaustive, but it gives you a good start. If you don’t understand some or any of these questions, consider having a business partner or colleague help you interview vendors. And always remember to engage in a service level agreement and contract with the vendor so all expectations are clearly articulated.
20 questions to ask a security vendor
1. Does your company have a pre-employment screening policy for employees and contractors? What is that process? What is your process for training them on security best practices?
2. Does your company have a written control plan that contains the administrative, technical and physical safeguards you use to collect, process, protect, store, transmit, dispose or otherwise handle our data (e.g., information security plan)?
3. Does the system or application which will be storing our company data provide access control mechanisms (e.g., unique user IDs, passwords standards, role-based access)?
4. How will you help me comply with all applicable privacy and security laws for my business?
5. What certifications if any does your company have (ex. ISO 27001, SOC, etc.) and can you provide documentation?
6. Does the system or application provide multi-tenant controls for separation of users and data within the service?
7. Does your company utilize encryption methods for data in transit and data at rest where technically possible and legally permissible?
8. Are files and records reviewed, retained, and purged in accordance with legal requirements, contractual obligations and service level agreements?
9. What is your process for purging all files and records and removing accesses upon completion of the service, task, or contract?
10. What is your commitment to response time if I have a question or emergency? Do you have “off” hours?
11. Does your company have written business continuity/disaster recovery plans, which are tested on a periodic basis?
12. Does your company ensure adequate steps are taken to guard against unauthorized access to our company data (e.g., firewall)? Please list the technology and processes that are in place.
13. Does your company maintain up-to-date versions of anti-virus software, anti-malware, antispyware, and operating systems security patches? Please elaborate.
14. What will your company actively do to prevent security incidents or breaches, and how often do you plan to check for vulnerabilities? Please elaborate.
15. Does your company have a written plan to promptly identify, report, and respond to breaches of security related to our company data (e.g., incident response plan)?
16. Would our company retain ownership of its data at all times?
17. Does your company hire an external audit firm to perform a compliance review of your operational controls?
18. Will third party vendors (e.g., subcontractor, managed shared hosting) used by your company be restricted from having access to the system or application data of our company?
19. Does your company provide assurance (in the form of a written report) of your and your third-party vendor’s security and controls while customer data is being collected, processed and retained?
20. Can your company, and any relevant third-party service provider your company contracts with, send the results of your last security audit?
Hiring a security vendor is crucial to ensuring your customers’ personal and financial information is safe from hackers or other cybersecurity threats. Over the next few months, we’ll share greater insight and tips on other ways to safeguard your business and protect your customers’ financial information. In the meantime, we offer additional resources to brush up on your financial education with ACHIEVE for consumers and small businesses. Click here to start learning today.
5 money tips for new college graduates
So, you’re a college grad. Now what? Stepping into the real world can be scary, especially when you’re on your own financially. The mere thought of adulting is daunting enough—but don’t stress. Below are five tips for managing your money as a new college graduate:
1. Know the 50/30/20 budget rule
The thought of budgeting can be intimidating, and it’s hard to know where to begin. The 50/30/20 method is an excellent starting point, as the rules are pretty self-explanatory. If you’re unfamiliar with this method, you’ll start by dividing your after-tax income into three categories: needs, wants, and savings.
50% of your budget will be allocated for needs, like rent, groceries, transportation, utilities, and insurance. 30% of your budget will go towards wants, like shopping, gym memberships, dining out, or entertainment. Lastly, 20% will be set aside for savings, like an emergency fund or (eventually) a down payment on a house.
2. Practice small but good financial habits
Experts say it takes an average of 59 days to form a habit. So, for the next two months, start implementing small but good financial habits. Some examples:
- Monitor your accounts regularly. Set an alarm at the same time daily to review your accounts and ensure you know what money is coming in and what’s going out.
- Know (and monitor) your credit score. You’re entitled to one free credit report annually from each of the three credit bureaus. Georgia residents are entitled to two additional free reports each year. Many credit card companies also offer the ability to check your score for free on a more frequent basis (without impacting your score). These scores give a basic level of insight to your score, so it can vary between the models other lenders use. It’s still worth monitoring, though, because it can alert you to any significant changes.
- Pay off your credit card as often as possible (and for the highest amount possible). Credit cards have higher interest rates compared to other loans, so it’s best to keep your balance low and pay as much as you can.
3. Start saving for retirement ASAP
You’re never too young to start saving for retirement. Does your job offer a 401(k) with employer matching? If so, you want to take advantage of that, or else you’re leaving free money on the table. When an employer matches your contributions, they add a certain amount in addition to what you contribute (often up to a certain limit).
For example, your company may elect to match 100% of your contributions up to a percentage of your compensation. Let’s say your organization offers a 100% match up to 6% of your annual income. If you earn $60,000 per year, the maximum amount your employer will contribute is $3,600. To maximize this, you must also contribute $3,600 annually. If you contribute more than 6% of your salary, the additional contributions are unmatched.
This varies by organization, so it’s best to refer to your employee handbook for your company’s policy.
If your company does not offer retirement benefits, you can also invest in a Roth or traditional IRA. A Roth IRA allows you to contribute after-tax dollars to a retirement account, so your account grows tax free. With a traditional IRA, you contribute pre- or after-tax dollars, but your money grows tax deferred. You would then pay taxes upon withdrawal. If you’re unsure about which account works best for you, consider speaking with a financial advisor. Georgia’s Own offers consultations with a financial advisor at no cost and with no obligation.
4. Build your credit score
Having a good credit score is essential for many tasks you’ll tackle as a recent graduate, like renting an apartment or opening a credit card. Your credit score is determined by the following factors:
- Payment history: Whether you’ve paid past accounts on time
- Amount owed: How much you owe across all accounts (this is also referred to as utilization, which you want to keep below 30%)
- Length of credit history
- New credit: How often you apply for new accounts
- Credit mix: The variety of credit products you have (credit cards, auto loans, student loans, etc.)
If you don’t have a good credit score, there are a few ways you can build your credit. You should pay your bills on time and lower your debt. You should also leave any old credit cards open, especially if they don’t have an annual fee. Closing credit cards can ding your credit score. You may need to make a purchase every six months or a year—some lenders will close credit cards if they have been inactive for a period of time, with or without notice. However, if you’re paying a large annual fee to keep the card open, it may be worth risking a slightly lower score instead of paying tons of money for a card you don’t use.
5. Don’t rent outside your means
Social media makes it easy to keep up with friends—but it also makes it easy to compare ourselves to others. You may see your friends showing off their fancy new apartments or condos and think you need to do the same, too. But, housing is an enormous expense and could derail your budget if you live above your means. Let’s face it, you want to have the option to go to dinner with friends or see your favorite band in concert, rather than throwing most of your paycheck towards rent to keep up with the Joneses!
Typically, you should spend no more than 30% of your gross (pre-tax) monthly income on housing. That said, housing costs vary regionally. Evaluate your budget and income to determine how much you can comfortably afford.
Graduating college is an exciting time, but navigating the real world can be challenging, especially with new added financial responsibility. The decisions you make now will shape your financial future—but with the above tips, you can take charge of your money and be confident in your adulting abilities in no time.