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Jumping Into That Career

Financial advice for young adults entering the workforce

Laying the right foundation as you start your career is the key to future financial success, and at this lifestage, time is your greatest asset.  Consider that each dollar you save in your 20s can be worth ten times as much as each one saved in your 40s.  Through the magical power of compounding, the beginning of your working life is the prime time to start saving towards retirement.

During this time, young adults have the exciting task of learning how to manage the spending and saving of their money within the constraints of their income.  Here are some steps to take now to put your financial future on track:

  1. Identify your short, medium and long-term goals and budget your money accordingly:  Your short term goals of less than five years might encompass a wedding, honeymoon, furniture or a new car.  Medium term goals could include the purchase of a home and financing your future children’s college education, followed by long term retirement goals.  These goals will help you determine how to save and spend your money.
  1. Build assets by choosing to save a percentage of your income:  It may be wise to invest in CDs or money market funds for your short term goals and the stock market for your longer term goals.  Historically, the stock market has outperformed other types of investments over comparable time periods, but it is not for the faint of heart.  You may also want to join a 401(k) plan if available from your employer or open up an IRA account.

Certificate of Deposits - If you want to earn a higher interest rate, do not need immediate access to your funds, and want to be protected from possible loss of principal, consider opening a PCB Certificate of Deposit. 

Premier Money Market - A money market account is a limited transaction account which is ideal if you wish to earn a competitive interest rate but may need access to your funds.

Individual Retirement Account - IRAs offer special advantages for the money you have earmarked for your retirement. 

  1. Establish an emergency fund:  A good guide is to save three to six months worth of living expenses to cover rent or house payments, utilities, car payments, food, transportation and insurance in a separate bank account that could be easily accessed in the case of job loss or uncovered medical expenses.

Savings Account - PCB knows unexpected expenses pop up. With this easy and convenient product you can have access to your money at any time. 

  1. Conserve time, money and paper with PCB’s checking accounts which offer FREE Internet Banking, FREE Bill Pay and no-charge ATM services:  You will reduce the time it takes to pay your bills and save on the expense of printed paper checks and postage while helping the environment.

Totally FREE Checking - Looking for a checking account with no service charges and fast, convenient access to your money?  This is the account for you.  Totally FREE Checking was created for people who want a basic checking account  and the tools to make their life easy.

Ultimate Checking - It is time you got rewarded - just for living your life. 

  1. Borrow wisely:  Avoid high-interest credit cards and pay off your credit card debt monthly.  Work with PCB for your the majority of your lending needs including personal and vehicle loans, home mortgages and home equity lines of credit.  

Mortgage Loans

Personal Loans - Whether you need to consolidate debt or upgrade your college clunker, PCB has the loan for you.

  1. Understand your credit report:  Your financial behavior over the past seven years, including how much credit you have, how long you have had it, and if you pay your bills on time is information included in your credit report.  Your credit report also contains your credit score ranked between 300 and 850.  Lenders use your credit report and/or credit score to help them decide whether you are creditworthy and will repay a loan.  Your credit score can also influence the interest rate you pay; in many cases, the higher your score, the lower your interest rate.  You can obtain your credit report from the three credit reporting agencies below: 

   


Tips for Effective Financial Management
  • Pay off your credit card debt.  Do not pay 13 - 20 percent interest on credit card payments while your savings accounts earn one or two percent.
  • If you cannot pay off your credit card debt, pay more than the minimum payment each month which, in some cases, will only cover the interest charges.
  • Don’t  worry  too much about paying off student loans early.  These normally have a much lower interest rate than credit cards.  By making low payments on student loans, you’ll have more money to reduce high interest credit card debt.

 

For help determining the best accounts and products for sound and productive money management during your Jumping Into That Career lifestage,  please contact us.