Jun 20, 2013 - By Alejandra Silva, Staff WriterThe U.S. Small Business Administration and the Wind River Development Fund came together again to have their last business roundtable of the spring season. Bank accounts and budgeting were on the list of items to discuss for attendees May 8 at the Frank B. Wise Business Plaza in Fort Washakie.
WRDF is a non-profit community corporation that helps stimulate economic development on the reservation and provides resources to individuals who own a business or are interested in starting one.
Deputy district director from the SBA Wyoming district office Amy Lea initiated the discussion by explaining the importance of opening a bank account, especially if large amounts of money are acquired all at once.
Whether a person owns a business, receives a big tax refund or settlement payment, attendees listed the advantages to placing that money in a checking or savings account with a bank. Lea said many people today don't have bank accounts. She said the first step to financial stability is to find a good bank account that will serve as the prime location to secure money and prevent a person from spending it all at once or losing it.
She said it is important to learn about the bank's fees, charges, interest rates or terms. Lea said asking friends and family members if they like their banks is also a good way to find a bank.
"Ask yourself, 'Can they meet all of my financial needs?'" Lea said.
After choosing a bank and opening an account, the second step is saving money. Lea suggested having the amount of at least one pay check in a savings account.
"You gain that one bit of financial stability," Lea said.
She said some experts suggest having three to eight months of household expenses in the savings account.
"It can take years to get to that point," she said adding that it's possible and worth trying.
While emergencies do happen, many times unexpectedly, the savings account, Lea said, will be there when needed.
After committing to save money, Lea said the next step is creating a budget and writing down all of the expenses. She said that after adding all the expenses, if the amount of money going out is more than is coming in, an extra job or activity, like a garage sale or providing child care, can help balance that scenario.
Attendees agreed that initiating credit and starting to save can take time, but those efforts will help in the long run with home or vehicle purchases.
Lea cautioned the crowd about treats versus needs.
"Just because your neighbor down the street is getting a new car doesn't mean you have to," she said. "He's probably digging his hole twice as much --people aren't willing to tell themselves no."
Lea suggested that another good way to save money is by using the envelope method where the saver puts money from his paycheck into an envelope marked with the name of a bill that has to be paid. When the bill's due date comes around, the money will be there, unless it has been spent on something for which it wasn't designated.
Beware of loans
WRDF finance director Veronica Roemmich recommended staying away from payday lenders, because a person shouldn't have to pay a person to use her own money. She said people should be aware of the high interest rates and other hidden fees or terms that come with loans.
"They exist because people don't know how to manage their money and finances," Roemmich said.
For school loans, Lea said a person shouldn't borrow more than his first year's salary.
"They offer more than you really need," Roemmich said.
The business roundtables are offered in the spring and fall and also can be offered upon request.
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