Welcome to a new limited series! For the next several weeks I’ll be sharing tips and advice from local professionals on topics that might not have been covered in your schooling. Whether you’re a teen getting ready to strike out on your own or an adult who hasn’t had someone whom to ask these questions, the library is here for you! These events are happening in person at the West End Branch on a set of Mondays at 4pm for teens. The blog posts are for any teens that can’t attend or any adults who’d like the information as well.

Tori Filas: Virginia Credit Union

Tori Filas is an accomplished educator who specializes in curriculum development, instructional design, and educational technology.  She comes to Virginia Credit Union following a recognized twenty year career with Henrico County Public Schools. Each presentation that Tori creates for elementary, middle, and high school learners is centered around Virginia’s SOLs for economics and personal finance.  When it comes to spending, saving, and managing money, Tori is available to help students from Kindergarten to grade 12 learn how to make good financial decisions through engaging classroom lessons and activities. She is passionate about equity and inclusion in financial education and believes financial success is attainable for all.

First off, how important would you consider budgeting and why?

On a scale of 1-10, it’s an 11! Budgeting teaches you how to manage your money and take responsibility for your own financial well-being. It also helps you to learn how to live within your means and avoid unnecessary debt. People who learn how to budget are better equipped to manage their finances in the future. Budgeting helps you achieve your financial goals, whether it’s saving for a car, college, or your first apartment. Overall, budgeting helps you to plan for the future and make smart financial decisions.

What are some green flags to look for when deciding which bank/credit union to use?

Some green flags to look for when deciding which bank/credit union to use include low fees, high-interest rates on deposits/low-interest rates on credit and loans, good customer service, and convenient branch locations. But first and foremost, make sure that any bank or credit union you choose is insured by the FDIC (Federal Deposit Insurance Corporation) or the NCUA (National Credit Union Association) so that your money is protected. You’ll also want to learn about their online and/or mobile banking features to make sure your financial institution is equipped to process your transactions quickly and easily.

What’s the difference between fixed and flexible expenses?

Fixed expenses are regular expenses that remain the same each month, while flexible, or variable expenses vary from month to month. For example- rent, mortgage payments, and car payments are considered fixed expenses because they are the same amount each month and are due usually at the beginning or end of the month. Dining out, groceries, medical expenses, and gifts are considered flexible or variable expenses because they are different every time and are paid at various times of the month.

What are some best practices with regards to staying on top of bills?

Some best practices for staying on top of bills include setting up automatic payments or reminders, keeping track of due dates, and creating a budget. Make a list of all your bills: rent, utilities, credit cards, etc. Use an app, spreadsheet, or even a notebook so you can see all of your bills in one place. This will help you keep track of them and can serve as a checklist each month so you don’t miss any payments. This list can become the foundation of your budget! Make automatic payments when possible to remove some of the stress and time pressure of paying your bills. Monitor all transactions to make sure you have enough money to cover your bills and that no errors are made.

How does savings tie into a budget?

Savings tie into a budget by setting aside a portion of your income for future expenses or emergencies. At Virginia Credit Union, we encourage our members to follow the 50/30/20 Rule. The idea is to divide your income into three categories, spending 50% on needs, 30% on wants, and 20% on savings. But no matter how much you decide to save each month, there is one thing you should always remember- Pay Yourself First! This personal finance strategy prioritizes saving and helps limit spending. Put money in a designated savings account before paying bills and making other purchases. Your future self will thank you!

What’s the difference between a debit card and a credit card?

A debit card allows you to spend the money you have in your bank account, while a credit card allows you to borrow money that you must pay back with interest. When you use a debit card, the funds for the amount of your purchase are taken from your checking account almost instantly. Look for first-time student account products at financial institutions. Most banks and credit unions will have a special checking account for teens that might provide you with specific benefits such as no monthly fees and free overdraft protection on a transaction or two. You should also research the minimum age at which you will qualify for a debit card. At Virginia Credit Union, you can open your own checking account at age 13. When you obtain and use a credit card in adulthood, the amount will be charged to your line of credit, meaning you will pay the bill at a later date, which also gives you more time to pay.

What are the benefits and drawbacks to having a credit card?

The benefits of having a credit card include building credit, earning rewards, and having a financial safety net. As an adult, a good credit score can help you get better interest rates for things like car loans and mortgages. They are convenient and easier to carry than cash. In the unfortunate event that your card gets lost or stolen, you aren’t liable for any unauthorized charges. Rewards can also be nice in the form of cash back, airline miles, gas rebates, and more. And we all know that credit cards are great for online shopping. However, there are also drawbacks. Since they are so easy to use, they also make it easy to overspend. If you buy something and don’t pay it off immediately, you will end up paying not only the purchase price, but also the interest charge on that item. If you carry a balance, all your purchases will end up costing you a little more.

What’s the difference between a line of credit and a loan?

A line of credit is a flexible borrowing option that allows you to borrow up to a certain preset limit. It can be used at any time, paid back, and borrowed again. A loan is a fixed borrowing amount based on the borrower’s specific need, such as the purchase of a car or a home. Interest accrues on the full loan amount right away and is paid back over time, usually for many years.

Summary

Budgeting is important for everyone, regardless of age. Keeping track of what you’re getting paid and where your expenses are going help you plan for vacations or emergencies as well as staying out of debt. Here’s some digital financial resources on our website. The fiction titles below have budgeting as a major topic and the nonfiction titles are some physical resources.