By Susan Sorenson, Murray Branch Manager, Bank of American Fork
This article first appeared in the Murray Journal. Susan Sorenson shared the following money tips for both business owners and consumers.
Susan Sorenson has spent 17 years of her career at Bank of American Fork. She is currently the branch manager of the Murray branch as well as a loan officer. She and her husband have three daughters between them and five grandchildren. She enjoys spending time at ballgames and other activities with the family. Susan loves to ride with her husband on their Harley and looks forward to their weeklong adventures each summer riding to various parts of the country and to bike rallies.
I have been in banking since 1982, as well as raising a daughter and taking care of family finances. I have learned a lot by applying some of the ideas I use myself and share with customers. I am actively involved in the process as customers apply for loans to fund their dreams. Some people are more financially prepared to qualify for financing than others are. Here are some tips I like to share with my customers, which may help you become prepared to make your dreams a reality.
Use a separate savings account for large purchases. Whether you are saving for a down payment on a house, buying a car, preparing for holiday gifts or a vacation, set up a separate savings account to save up. Budget how much you will save each month or pay period for the large purchase, and set up an automatic transfers to correlate with your paydays. Then you are only making the decision to save one time, instead of with each payday or each purchase from your checking account.
Make and use a monthly budget. Make sure you know how much money you are bringing home and what is remaining after you pay bills. Then you can divide the rest into savings, entertainment or other categories. If some of your bills or charges take a couple of days to process, make sure you are up-to-date on how much money you will actually have once your account reflects all pending transactions.
Set up online bill pay for recurring bills to avoid late payments. Use your online banking account to set up a recurring payment for bills that are the same. Some utility companies will also let you pay an average monthly fee even though the actual cost may vary from month to month, so you can set up a recurring payment, or you may be able to set up a payment through the system of the business charging you the bill if the amount varies each month. You may be able to avoid ever having late fees if you set up some kind of system to automate some of your bill paying.
Use credit cards with care. Consider not applying for credit cards at every store you shop at just to get a percentage off that first purchase. Multiple open credit cards or credit inquiries could reduce your credit score. Use your credit card for emergencies or to build credit, paying off the balance in full each month if you can. If you do carry outstanding debt on a credit card, make sure you are paying at least the minimum payment required each month by the due date to avoid late fees and a possible credit score reduction, which could affect your ability to get a loan in the future.
Set a budget before looking for those big-ticket items. Before you shop for a car, house or other large item, talk to your lender and get pre-qualified. That way you will have a good idea of the price range you can afford and you will not shop for the million-dollar house when your budget may be more around $300,000.