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Tip of the Week

Money Mantras

It's easy to get overwhelmed by the amount, depth, and complexity of financial advice out there. Perhaps that is one reason women admit to being less confident than men when making financial decisions. Many people find themselves free of a current financial crisis; however, they are not getting the most from their money either. These people could do better, but aren't sure where to start.

Below are five financial concepts all women (regardless of age, financial experience, or career path) should know from GoGirlFinance.com.

The Power of Compound Interest

When it comes to your money, it’s important to start now so you can give the power of compound interest time to work its magic. The sooner you start saving, the sooner your money starts earning interest … and then earning interest on that interest. Just because you don’t have a lot to save doesn’t mean you should wait to get started. Even small amounts make a difference!

Treat Your Savings as an Expense

You might have noticed that you don’t have money leftover each month to save. When we wait to see what’s left in our account before saving, that’s usually what happens. Instead, you should treat your savings as your most important expense, like your rent or cable bill. Decide what you can afford to save each month and have it transferred automatically to your savings account so you don’t have the opportunity to spend it. Pay yourself first!

Protect Yourself with Insurance and an Emergency Fund

Building wealth is a wonderful thing, but you also have to protect it. Emergencies happen, and if you don’t have an emergency fund and insurance in place, you might have to take on debt to finance the situation.

There are various types of insurance that can protect you in the case of an emergency or a high expense situation. Beyond health insurance, you should be investing in life, disability, and renters' insurance. For more on insurance, see this article.

While insurance can be a lifesaver in the case of a big medical, home, or car expense, there are situations where insurance doesn’t protect us. This is where an emergency or rainy day fund comes in. Have a few months of expenses put away in case you lose your job, are unable to work, or face any other emergency situation.

Avoid the Most Expensive Debt Out There

Credit cards are the most expensive debt out there, since a 20% annual percentage rate or interest rate is not uncommon. Think about it. If you don’t pay off your credit card in full, you pay 20% in addition to the cost of the item you bought. It’s the opposite of getting something on sale. Stick to spending within your means, and you will not only save on interest but your credit score will benefit as well.

Put Your Money Where Your Heart Is

At this moment in time, we all are earning a certain amount of money. We have the opportunity to use this pie of money in any way we wish. When we use funds in one area, we lose the opportunity to use it for something else. This is the opportunity cost of our spending.

To get the most out of your spending, put your money where your heart is. It’s about spending on things that are important to you and saving for your dreams. Really take a look at your spending to see if you are using it in ways that make you the happiest. Sometimes you will find you spending habits aren’t aligned with your larger financial goals and values.

Work these five money mantras into your life and experience the benefits of not avoiding money issues but embracing financial health instead.



Montana Credit Unions for Community Development (or MCUCD) is the award-winning, charitable arm of the Montana Credit Union Network. A state-wide nonprofit organization, MCUCD works together with the state's credit unions to improve the lives and financial independence of all Montanans.