How to protect your personal economy

With the presidential elections right around the corner, there is a lot of discussion and debate about our national economy.

Over the next few months, there will be promises of a better financial future for Americans, but it is vital that individuals and families understand that no matter the election results, they have the power to protect their personal economies.

While you should take steps to understand what is happening with our nation’s economy, your focus must remain on what you can control — your budget and spending.

The basic fundamentals of smart money management still apply no matter how confusing things get on a national level. The financial educators at Money Management International offer the following advice for protecting your personal economy:

  • Know your financial situation. Determine monthly living expenses, occasional expenses and monthly debt repayments. Reevaluate your budget and spending plan by comparing outgoing expenses to monthly net income, and make changes when appropriate.
  • Deal with the big issues. If you have large, looming financial issues, such as unpaid medical debt or tax liens, it is time to deal with them head-on. Contact your creditors and make acceptable repayment arrangements. Implementing a plan to remove these stressors from your life will be good for your mental and financial health.
  • Expect the unexpected. Now is a great time to start paying yourself first. Strive to establish an emergency savings account equal to at least three months of your income. If this goal seems too lofty, try having a small amount automatically deducted from your paycheck into a savings account. Also, instead of spending your raises, add any additional income to your savings account.
  • Perform a credit check-up. A clean credit report equals better loan terms and more borrowing power. If you haven’t requested your credit report in a while, now is the time to do it. Experts recommend that you pull a copy of your credit report at least once each year and before making any major purchase. Plan to pay off delinquent accounts and dispute any errors. The three major credit bureaus are Experian, Equifax and TransUnion.
  • Plan for your future. Secure your financial future by participating in a qualified retirement plan, such as an employer-sponsored 401(k). You can also contribute up to $5,000 each year into an Individual Retirement Account (IRA), or $6,000 if you're 50 or older by the end of the year.

Taking steps to improve your current financial position is always a good indicator of future success. A solid financial foundation will help you to weather any future ups and downs of our nation’s economy.

Tanisha (Warner) Smith is a former communications manager at MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.