Planning for Your Future-Now!

What do you think about when you're bored at work or stuck in traffic? Many of us may think about something in the future—an upcoming event, our future home, a cross-country road trip or perhaps even retirement.

 

But, sometimes, those blissful daydreams are interrupted by the question of how we will afford it.

 

The truth is, any future dream requires a bit of planning. Luckily, Mountain America Credit Union has some tips to help you achieve your goal.

 

Buying a home

Apartments and other rental properties are great when you want the luxury of living in a nice place without the responsibility of leaky pipes or clearing off a snowy driveway.

 

Owning a home, however, provides both a rewarding experience and a sound financial investment. Plus, home maintenance here and there can be rewarding and fun.

 

If you find yourself dreaming about a future home, there's good news—you don't need hundreds of thousands of dollars to make it happen! You just need a good budget, a vision and a savvy realtor.

 

First, make sure your budget is solid. If you haven't created a budget yet, schedule some focused downtime. Put on some music or a movie you've seen before, have your phone or laptop nearby and grab a calculator. Pull up your accounts, add up all your regular expenses and debts, then subtract that number from your monthly take-home pay. What you have leftover should go toward paying down debt, contributing to your savings or building up your future down payment.

 

But how much exactly do you need for a down payment on your dream home? It depends on your budget and the type of loan you get. Most people say 20% is ideal because it prevents you from having to pay mortgage insurance. That's certainly good advice, but there are a several programs available for those who don't have that much saved. FHA or VA loans, for example, often require as little as 3.5%. Speak with your preferred financial institution to find out what type of home loan is right for you.

 

If you're unsure of how much house you can afford, a mortgage calculator can help you determine what your monthly payment might be and what impact insurance, property taxes and down payments may have.

 

Seeing the world

Perhaps your future plans are based more around experiences than possessions. Start by determining how often you want to travel and where you want to go. Do you dream of a six-month-long cross-country road trip? Or, is an international trip once a year more your thing?

 

Regardless, start by researching your primary expenses.

 

Let's start with the road warriors out there. Car insurance, gas and RV rentals add up quickly, and they're all impacted by both mileage and destination. You'll also need to get your vehicle inspected by a mechanic before hitting the open road, so budget for that, too.

 

If you want to make your road trip a bit more permanent and are tired of roadside motels, consider purchasing your own recreational vehicle. You can find one as basic or as luxurious as you'd like. Ask your local bank or credit union what RV loan rates look like before signing any paperwork.

 

For those who wish to travel by air, don't forget that there are some sneaky fees associated with flying. Plan ahead for passport renewals, ride services to and from the airport and travel insurance—you never know when a global pandemic will derail your plans! Make saving for travel seamless by automatically putting a percentage of your paycheck in a separate savings account each pay period. Before you know it, you'll have enough to fly across the Atlantic—and maybe even enough for that fancy airport lounge upgrade.

 

Retiring

Retirement might seem far away, but it's always closer than you think. And even if you love your job, you're going to want to keep your options open.

 

The best way to plan for your retirement is to do it gradually and, if you can, in a way that doesn't disrupt your current lifestyle. Ask your employer what kind of retirement plans they offer. If they offer a 401(k) match program, enroll and max out their match. Because, seriously, who doesn't like free money?

 

Chad Waddoups, vice president of wealth management and business services at Mountain America Credit Union says, “It’s never too early to start saving for retirement. Look into the retirement account options you have and choose one that works best for you. Or, better yet, make an appointment to sit down with a financial advisor for added guidance.”

 

If the retirement options offered by your employer don’t meet your needs, consider opening your own IRA account. Choose between a Traditional IRA or a Roth IRA. Simply put, the difference lies in whether you want to pay taxes now or later.

 

Whichever retirement account you choose, opt to automate your deposits straight from your paycheck into the account. This simplifies your saving strategy and helps ensure you don't forget to make your contributions.

 

If you need help planning for these—or any other—future plans, reach out to your preferred financial institution today. We all could use a little guidance here and there, so don't be afraid to speak to a financial planner about your goals.