 Good afternoon, everyone. Thank you so much for joining us today for a financial achieving financial wellness workshop with a very own, what not very own the year. Yeah, Mark Munzenberger. Am I pronouncing that correct, Mark? You are Beretta. Thanks. I know it's very long, but yep, you got it. Yeah, yeah, absolutely. Absolutely. So just a brief introduction on what will be happening today. This workshop is being presented by the University of Michigan Credit Union's very own Mark Munzenberger. Mark is the financial education manager with the credit union and knows that financial wellness is key to financial success. He will cover the four pillars of financial wellness and provide a roadmap for success both today and into the future. He will also cover the essentials of money management, as well as the wise use of credit. So everyone, once again, I turn it over to Mark. Okay. Yeah, thanks, Beretta. Good to meet you guys and let me just just kind of share a few a few quick things before we kind of get started. You can probably tell I don't know, Beretta, you look like you, you're either at home or you've got a beautiful screen behind you. It's always nice to see everybody's back backgrounds and stuff. I'm actually in my office today. I am about three blocks from Rackham. I'm right on here on street. So it is a very easy walk for me to head down and when I need to stretch out a little bit, but I'm right. I'm in my office today. I serve as our financial education or financial wellness manager. Really, that means I'm responsible for all of the workshops that we do for both students and staff and members of the entire University of Michigan and eastern Michigan community. I have worked with Paul, Artali, numerous times, and I know you guys probably know Paul. We do a lot of workshops for the students. And I'm also very involved in the Washtenaw County community with United Way, Habitat for Humanity, all of those type of things. So I've got a very diverse responsibility here to really champion our wellness programs. I'm also a certified financial counselor and really all that means is that type of work would be more individual in nature rather than this workshop type of setting we're in today. So, as Veretta said, today's workshop, right about 45, 50 minutes. I'm just, I would really, really appreciate you guys. If you please participate, use that chat box. Let's do a test. Let's do an experiment. I just went to my closet there, to my storage room. I've got a brand new U of M sweatshirt. It's what we're giving away this year, our UMCU. And what I'm going to do here in the chat box, you guys, on this card right here, I'm going to write down a number between one and 10. Whoever gets that number first, I will be mailing this sweatshirt this afternoon. So I'm going to write it down here, one through 10. And as I've got it written down. And so I want everyone to use the chat box. I'm going to pull it up here. And the first person that gets it right. I don't see it yet. I don't see it yet. So keep on guessing until, until I give you the thumbs up. I don't see it yet. I don't see it yet. There we go, Veretta. It is lucky number eight. So thank you. And you guys are, yeah, you know how to use the chat box for sure. We've been doing that a lot, haven't we? So, Veretta, when we finish, all I wanted, you let me know where I can send this, and it'll be on its way. Congrats. So thank you for doing that. So, so let's go ahead, you guys, we'll have a good discussion about financial wellness and some of the keys. And, boy, the last year or so has been, I would say, different and challenging and for a number of different ways. And so it's certainly has not been a normal year, you know, for a lot of us for a number of different reasons. But I'm always interested, you guys, if I were to ask you, if I sorted through this, I would say broad question out there. If I were to ask you, you know, what are the, you are healthy when you, you would say, when I eat my vitamins, when I get eight hours of sleep, when I exercise, we sort of know what health is. But if I use the word financial, how would you finish this sentence? What's something that kind of pops in? And feel free to use that chat box. You're financially healthy when you do what? Yeah. And Veretta, if you want, you, you're happy to share with everybody. If you'd like you, you can share, you can, that's, I mean, that's a great one. Three months savings. And I think, Veretta, you're, you're sort of going with that emergency savings. Sort of, that's where you kind of go in there. Sarah, just, yeah, pay all your bills and Sarah, I'll finish that on time and in full. That type of thing. And Carrie, when you have enough extra that you aren't continually terrified. Oh my gosh. Carrie, yes, I never want you to be terrified of unexpected expenses and to expect to retire someday for sure. So carry a little bit more of a sort of that perception or that stress, right? Carrie, you've ever heard that term? You know, gosh, I feel like I'm living paycheck to paycheck. We all of us at one time or another have sort of fallen into that. And three months of savings. So yeah, you guys, there's of course, no right or wrong here. And Jason mentioned when you don't have to worry about having enough money for expenses. Good stuff, Jason, absolutely. You know what I didn't hear you guys as you were going through that. I don't believe I heard this. When you win the Powerball drawing, wouldn't that cure a lot of ills? However, your instructor today is not suggesting that this is the roadmap to financial health. Lotteries are for entertainment purposes only. So if we were to, if we were to sort of kind of button that up a little bit, I would suggest you guys that on a broad level, kind of a high level, you like to start off with today's discussion with this blueprint. And this is some good ways to answer this sentence. You know, you're financially healthy when you, when you've got good behaviors and habits in these four areas. And I intentionally used the word habits. Do we, Veretta, what is your definition of habit? If I just said define that word for me. And Veretta, you can actually, you can just speak out loud if you want. Okay, so can you hear me Mark? Yep, I can hear you. Yep. If I do something on a continual basis, because I know that the old saying is, you know, when you want to create a habit, it takes at least 30 days to actually get it downpacked. But for me, that's true in and of itself. But also, if I do something on a continual basis for me, that's a habit. And it's also something that I really don't have to think about. Yes. Yep, I really like, I really like that. It sort of becomes, you know, especially as we get older, we do start to form some pretty good habits. And I will share with you, it almost feels a little funny, you know, when you don't do it. Let's say I'm going to use an example. Let's say I'm somebody that goes to the gym. I work out three times a week. And when I don't do it, it throws me off a little bit, because it's a habit. And, and, and as you kind of look at these areas here, there are certain things where I really encourage people. You know, what we want to do is not only do we want to do these eight things and we want to, you know, we want to make them a habit. And one of the common things I see you guys is savings. What typically happens in America, February, March, April, we file our taxes, and what do many of us get in return, two weeks later we get a tax what we get a tax refund. And what I often see is I'll work with somebody throughout the year. And there is, there's no interest in savings. They just don't do it month to month we do it no saving. They save once a year. They get that tax refund. They put about $1000 in there in their savings account, they spend the rest of it. And for the remaining 12 months, they don't save any money. Not a habit. It's an event. It's not a habit. And so I would suggest you as you kind of look at this a little bit and reflect a little bit about, you know, sort of, how are you doing in these areas. And that's a lot of times I'll use this when when I'm starting out when somebody reaches out and says, Hey, Mark, can I talk to you a little bit about my home budget or I want to improve my credit. I'll certainly do that, but I like to have a little bit more of a holistic discussion about their finances. And these are the areas that I typically cover how we do it on savings, do we have a good ability to spend within our means. Maybe like number eight, planning planning ahead, anybody going away this summer for a needed vacation, maybe some home improvement. Yeah, we're still thinking right. I'll tell you some of the best vacations I've ever had had been those that I've, I've got a chance to already pay for before I'm headed out the door. Sarah, did you have a question you wanted to share just take yourself off on mute. What did you do Sarah I saw. And, and feel, feel free to do that if you'd like. Okay. All right, so let's go ahead. So the same lines with those four areas here is something that we call our money mindset. And you're thinking well what what is that. And I would suggest you guys that in order to really do well with our finances. And I would say get off to, you know, a good start. We all have a unique and individual set of core beliefs about money and how money works. It's essentially our attitude about money. And you guys know at work, you've I'm sure you've gone through like the importance of a positive attitude. I would suggest it's the same thing. And a lot of folks, I'll share with you a few examples, fall into some traps in terms of their attitudes, and, and it holds them back a little bit. Here's a few, here's a few examples. Has anyone ever made a money mistake. Just just by a show hand. Yeah, I should put two hands up. And you guys know what I do here. I should put two hands up. Too often, I get people of Jason yeah, I get people that have made money mistakes and they're passing up, and it holds them back. They're apprehensive, they're nervous, all those kind of things. Guys, you can't hit the rewind button. Don't let past money mistakes, linger, hold your back. Set realistic goals. I have found that sometimes small realistic attainable goals will get you on the right path, as opposed to one lofty gigantic goal, which is, which can be challenging. Let me give you a quick example. Oftentimes I'll get somebody to say, Mark, you know, I really got to get these credit cards paid off. I got five credit cards high interest rates are slowing me down. I'm like, good, let's start working on it. Goal number one credit card number one, we're not going to try to pay off all five of these and 30 days. That's unrealistic. Number one, let's get it paid off in the next 90 days. We'll move on to a next one. Slow, steady wins. Slow, steady wins will get us there. Same thing with savings, that type of thing. Don't keep up with the Joneses. Sometimes when I when I share that with students college students, they kind of give me a funny look. They're like, I've never heard that before. And it's a little bit, you know, as us adults out there we've heard that a lot. And I'll use an example like social media influencers and and neighbors and friends were on Facebook all day. We're seeing all this stuff. And just as humans, we start to try to keep up with the Joneses. I'm making financial decisions not based on my situation. But what I see out there, what we got to do is be strong. Don't keep up with the Joneses. Finally, number four, would you guys agree that oftentimes money is is not always the easiest to talk about with friends and family and coworkers and stuff like that. And I would just suggest you guys that without sharing salaries and stuff like that, that it is okay though. It's somewhat of a taboo topic and I really try to encourage people. It's okay to ask for help. It's okay to bring up topics and stuff. We're all in this together. We all have to navigate the system, don't we? Nobody can opt out of it. So just a few quick things here. I wanted to check the chat box really quick, you guys. I think I had a few, just a few quick things. So, okay, Sarah, yep, no, no problem. I just wanted to make sure you didn't have didn't have a question for me there. So, all right, so let me go ahead. Guys, if you do have any feedback or questions as we go, feel free to use that chat box. I'm happy to take a look at those. Let me just share with you some some best practices in my experience. And I've in sort of been doing this about 20 years or so, a financial counselor, so some best practices in terms of some money management. So the first one, y'all, I would suggest that, you know, financial wellness doing well in those four areas really starts with you having some type of plan at home. We can call it a budget, we can call it a spending plan. And you guys are thinking, oh my gosh, Mark is going to tell me to keep everything on a notebook. I'm just using it as an example, but just conceptually, do we have something at home that helps us sort of have a visual eye into our dollars. Too often I'll ask somebody I say hey do you know, are you tracking or do you have a good sense of where the money goes. And I sort of get this or well I use a budget but it's all up here that I get that point out it's all up here. I don't have anything on paper. So, I'm just curious guys you can sort of if you want to put up a one for a two for B. This is sort of an unscientific question but based on years of survey responses. It is estimated that this percentage of households in the country actually use some type of budget throughout the year. What do you guys think, or feel free to chat that in. Let's see what y'all come up with here. Oh, Carrie you're going low Carrie you're not as optimistic are you. Yep, you're not as optimistic on this one and, and yep Debbie you're saying. Yeah, and, and Carrie it's not as it's not as bad as you might think but it's about one out of every three people. And gosh you guys think about it like every business, every government agency, every school district. We all operate on annual budgets don't we, except for households, two out of every three households say, I'm just going to take it week to week month to month and we don't really have any type of system. So, as an oftentimes when I, when I, you know, talk to people, I just encourage them, it's, it's not as difficult or as time consuming as you might think. But oftentimes I'll sort of hear oh mark I don't have hours and hours each month. I've been doing a budget for about 25 years. It takes me about 20 to 30 minutes a month, just to sort of get something down it's not that big. It really is just a tool to help you compare your net income, and that's the dollars that you've got available to you at each and every month, compared to your expenses. And we all know that we've got different levels of expenses. Some fixed expenses like our mortgage payment our car payment and then more variable expenses like groceries eating out vacations. This is something that we should do monthly because we know things change throughout the year. So, for example, variable means, for lack of better explanation, could you show it to me. If I said a peretic came to me and said mark I need your advice about, you know, money. I'm like, I'd love to give it to you but can I see your budget. I want to see the numbers I want to see what's going on. Is it something that you could show me. It's a proactive document, meaning when you're thinking about it's something that at the beginning of the month you want to give some thought to, it's not reactive it's not something that where you just kind of, you know, track everything at the end of the month. It requires some planning ahead, and it really gives you transparency. It really gives you transparency so often. Carrie, you can just give me a thumbs up or thumbs down that that's all. So Carrie within, I'm just picking on you, but within $25. Okay, within $25. So, would you, would you be able to tell me how much you spent at the grocery store, April of 2021, without looking at your, your statement of just right of it, within $25. What do you think, not so much Carrie and that's, that's okay. All this really does is it just gives us a little bit of transparency. It kind of shows, wow, I'm spending a little bit more than I thought and those kind of things, especially for those variable expenses. And often an exercise that I'll do, even before we even put some numbers down is I will ask somebody if if we were to put all your expenses into one of these five buckets. This is set, this is net pay, this is take home. And, and we just put it into one of these five buckets, and how close or how far away would you be to these recommended percentages. Nobody's going to be perfect. We're all going to be a little higher, a little lower in certain areas. But for example, look at transportation. That would be car payment, car insurance, gas, any maintenance, those kind of things. Depending on how much you're actually bringing home. If you're spending 25 to 30% of your net income on transportation. I guarantee that some of these other areas are going to be under some stress. Just because this is a formula that sort of gets us, you know, in the right ballpark. Okay. Housing is another pretty common one. Oftentimes, especially it's not that easy to live in Ann Arbor and Washtenaw County and stuff like that. I'll work with people and I'll see 50 to 55% of their net pay is going to their mortgage or rent. And it's like, and they're having trouble savings. They're having trouble paying their credit cards down. And I understand that housing is vitally important, but that's where I use this to kind of take a look at the other expenses and to see, you know, what do we need to do to make sure that our dollars are kind of going, you know, appropriately. So let me hop over to the chat box right here and let's see Carrie. Yeah, and Carrie, it's hard. And Carrie, I do want to share with you that housing would include like your heating bill, your electrical, your water. So it includes a few of those essential utilities. But I agree with you. Housing is typically the one of the most challenging, most challenging categories. I don't, I wish I had a perfect solution for you, but what oftentimes happens is, you know, when we are sort of a little top heavy in housing, usually it means that we struggle a little bit for savings. We struggle a little bit to, you know, really make progress on our other debt. So no worries Carrie you don't think that that's unusual. So if you are somebody that like Mark, come on, I'm not going to use a notebook. There are a few things to maybe even help you excel. I personally, I'm still somebody that has an Excel spreadsheet. This is a website that has a number of free budgeting spreadsheets. If you ever wanted to just, you know, take a look at some of the free examples. I've got a couple that I use with a lot of our members, and I really like them because it does the math for you. You know, you kind of type the numbers and it automatically adds it up and I can easily see it, and I can carry it over month to month. So it's just something, it takes me about 20 minutes a month. I do have other people that, especially some of the students and those type of things. I really enjoy using some of the budgeting apps. And these over the last five, six years have really gained in popularity. Mint is probably an app that some of you guys have heard of. It's been around for a little bit. Wine app or the acronym for you need a budget is a very popular budgeting app. It's probably one of the most popular ones out there. It does cost about six bucks a month to use. It's a really neat budgeting tool where if you're somebody that likes to actually kind of carry it with you, not have to worry about keeping it on a spreadsheet. The feedback I get on you need a budget is very positive. People say it, it's well worth the time, because it does a lot of the heavy lifting and for me. So every dollar and pocket guard or a few other options. I just wanted to share with you a few options out there. Any questions or feedback so far anything just a little bit of motivation about just making sure you've got some a system there. All right, so let's hop over guys let's change let's change tune. Let's talk about credit. We all probably know is is credit important here in the US and as consumers. Yeah, I oftentimes use this, use this analogy. It's, it plays a big part in in our financial reputation. It's one of the first things that a bank, a credit union a lender will do. If you're kind of want to do business with them, they're going to quickly look at your credit and and sort of without even getting to know you or having a cup of coffee with you, they're going to use this credit score to kind of paint a picture of you, this kind of connection. And so we all know that having a solid credit history is important. And, and there are a number of important, I would say areas of our lives, does anyone want to share with me. What areas of our lives does credit impact and feel for you can either share it or type it in. What areas of our lives if I said you know it's important to have credit. And yeah, Debbie you're saying car insurance. I'm going to talk to you a little bit about that in a minute, being able to get loans carry I like that absolutely all the ability by car get a job carry. Excellent. Yes, sometimes students give me a dirty look when I say that. Because that that is a surprise to them but you know when we're, when we're talking about the importance of credit, this is typically what we focus on right. Whenever we need to borrow money, a house, a car, a personal loan, we want to make sure that we get that red stamp. And, and one of the most important criteria for any lender to give you a loan is your credit score, your credit history. And how have you handled credit in the past. So that's one of the most important things renting that we have a lot of renters out there, and, and that's an important factor to make sure that you can get into a housing situation that your desire. Somebody said this carry I think you might have mentioned this, the employment applications, and a lot of students are like hey wait a minute, you know why. And, and typically what an employer will say is it helps us paint a clearer picture of the candidate. It really shows us how you've handled your financial affairs, because how you handle your financial affairs may carry into how you'll handle your financial affairs here at the job. And so it's, you know, it is something to consider. I believe someone. Let's see I think it was a Debbie I think you mentioned car insurance. Debbie I think you mentioned that. Now, that is true to a certain extent still here in Michigan. So a insurer can look at your credit report for determining your rates, they cannot use a credit score any longer in Michigan. So the state of Michigan is, is cut down a little bit on how much and ensure can completely base your rates on your, your credit score, but it is also a factor. So if you have really poor credit, it may impact an enrager insurance rates. So, I would say probably the most common, you know, way to start in credit does anyone have a credit card, just buy a show of hands. Most of us do, don't we, this is typically. This is typically where we start in terms of credit cards. And you can see my example here. You know, credit cards are, I wouldn't say they're a friend they're a full, there are pros and cons to credit, and especially for young people. There's no way for young people to build a credit history a lot of students, by the time they're 2021 22 like to get that first credit card because they like to start establishing a credit history. It's a really good way to build a low limit credit card. There's a convenience factor, we you know we can buy it now we can pay it at the end of the month when the bill comes. There's an emergency and of course, who doesn't like the rewards right Verrata who doesn't like to get the cash back I mean those are fun. But I will share with you you guys of all, I would say, you know when people come to see me. And one of the most common issues that I see that that are kind of holding them back financially as they got themselves into excessive credit card debt. Really, not anything they did intentionally it could be for a lot of reasons, but credit card debt can be one of the most challenging things to overcome. Why, because they're higher interest rates on credit cards. Now you guys, I could probably for a car loan, they're about two to two and a half percent for an average interest rate on a visa or a mastercard is about 16%. That's the difference higher interest rates. It's easy to spend what you don't have, you know, any late payments are very damaging. And it is easy to obtain multiple credit cards, which can lead to a lot of bills and stress, I think here. Look, um, yeah, just just a day or so ago you guys, oftentimes what I'm doing financial counseling, when one helpful tool for me is to actually pull the credit report. And this, this was somebody that I just counseled yesterday. And the credit report is 121 pages. There are 42 open credit cards on this credit report right here. And, and it's more of a guys, this person is, we've got so many the bills and trying to manage all this. It's actually fairly easy to get a lot of credit cards. And so this was just a session I did yesterday. Yeah, this darn credit report is 121 pages. And so what we got to do, we got to simplify our financial life right now that's a lot of pages isn't it. Yeah. And so I usually show this example a little bit using a credit card can be a really important financial tool. We just need to avoid those little traps there. So here's a fairly common example. We've got a consumer here with a balance of less than $5,000. A rate of 18%. For the average between I would say 15 and 20. That's the average interest rates for the big bank cards. A minimum payment, which is how a credit card works, you can just pay off the minimum about $115 and the due date isn't is in a couple weeks. So just a couple things about this card. Number one, if you are one day late, getting it into the creditor, you will be, you will incur a $35 late fee automatically. If you are 30 days late, the bills do May 20th, you didn't pay it until April 30 days late, you will get reported as late to the credit bureaus. And that will remain in your credit report for seven years. Just that 130 day bit seven years before that payment drops off. If, unfortunately, you miss two consecutive payments, it does happen sometimes if an income stream is interrupted, the creditor will automatically increase your interest rate to 30%. And there's nothing you can do about it, you guys. This is not like a mortgage or a car loan with a fixed rate. That creditor will increase your interest rate to 30%. And they'll probably keep it there for about a year until they would consider lowering it. How can anybody get out of credit card debt with that kind of interest rate? So if you decide, you know what, listen, I want to get this card paid off. It's just this doesn't mean I'm going to just pay I'm going to make the minimum payments I'm not going to use the card anymore, minimum payments. Carrie, can I have a guess how long I just I'm not going to use a card how long would it take for you to pay this off if you just make minimum payments. Yeah, without a calculator, I'm going to guess around seven years. Yeah, and carry not bad, not not bad. It's 18 years. And, and the data is not even 5000 but Carrie, the good news is, let's say you and I, we did a little bit of work and we found about $50 in your budget, maybe a little less going to Starbucks. So just a little couple less pizzas each month. If I was able to find 50 additional dollars in your budget, which means the minimum payment add $50. I'd have you out of debt in three years. If we could find 50 additional dollars. So what this example is showing us is, let's not use credit cards to the point where I'm only making the minimum payment. Like I'm running on a treadmill. I'm just never making progress. And do you remember that picture I showed you, she was kind of in overhead. We don't want to do that. So we want to be really careful with our cards. Any, I'm going to hop into credit scoring are we so far. So I think we're good stuff so if there's any questions you can just chat those into me. Hopefully, we have good credit score so without without sharing it nobody has to chat it in. Who is perfectly confident or maybe I was checked in the last let's say 90 days, who knows what their score is. If, you know, within a couple points that kind of thing. So as you can see by this this slide here, the higher the better. If I could get you I usually say people that are just starting out 700 would be a good I would say initial target 700. If I could get you 720 and above. I'm going to get you in that top tier 720 and above. So it's going to get you the best rates that type of thing but 700 is going to get you in good shape. So it's going to be less than that, you know, it's, it's going to put us in a position where we, it's going to be more expensive. So, do I have any you have them sports fans, maybe any, you know, maybe a few folks and Veretta do these two gentlemen look familiar. You may see Jim we see in the fall on the football field and coach John Howard is basketball. They both I want to borrow $20,000 for a car loan. They're going to pay this back over five years. That's a fairly common term. Well with a credit score of 640 which is kind of in that lower tier you guys it's about a it's about a C minus Jim will incur today about an interest rate of about 11%. He'll pay a monthly payment of 435 and this loan will cost him about $6,000 in interest because of that higher interest rate. Look what happens if you've got a 720 which is kind of in that top tier. Today, I'm probably going to go an interest rate two to 3%. The payment is $75 less each month and look how much he'll pay an interest about $1,500. So this is why it's so important. You know what we say here the higher the better really important that anytime you kind of go into a lending situation whether it's a car, a mortgage, something like that. The credit score is really really drive the cost of the loan. So let's see. I'm going to ask you guys again to chat in. Unfortunately guys I was 30 days late on my most recent visa credit card bill. So once this appears on my credit report, my score will likely drop how much 10 to 2030 to 4060 to 80 or it won't drop just for that one late payment. So let's take a look. Let's see how we do here. And ready you're going to go a 10 to 20 Jason and carry a little higher 30 to 40. So I have any other guesses out there anybody else. I was late. And Debbie you're going to you're going to sort of stick with with Jason and carry they had a good. They approached it right way. This is the best answer you guys 60 to 80 points. Late payments make up the bulk of your credit score about 35%. It's, it's a pretty sudden drop, and it's going to take a while to recover. So, do you remember back the very first topic that we talked about was, I kept holding this up right, and I said, do we have a good plan to make sure things are getting paid and stuff. The last thing I would want is, is, you know, sort of things, and have some late payments they can be pretty damaging here. Let's do a little bit of truth or myth. You're welcome to do this, or you're welcome to chat it in a little bit I get a lot of questions about credit. So we'll quickly kind of take a look at some truths or myths. The first one reads as long as I pay off my credit cards each month, my score is not impacted by how much I actually charge on the cards. Is that truth or myth. I'll give you just a minute to send that in. Now, Debbie, if your days late does that impact your credit score, Debbie, it's usually you usually have a 30 day grace period. Now, Debbie, understand if you're one day late, if it's due on the 20th, the creditor gets the payment on the 21st, you're going to incur a late fee. Absolutely. However, usually the creditor will not report you as late to the bureaus until you are in excess of 30 days late. That's typically the first tier is 30 days late. So if you get it in day 10 day 12 day 15. It's late, you'll have a fee, but you won't be reported as late. So Debbie, I think that's your question there. This you guys is a myth. The issue here is timing. Oftentimes your creditors all report to the bureaus once a month at usually at the time that the statement closes. So if you are somebody that uses credit cards a lot during the month. If you're looking for a decent percentage of your credit limit on that will be reported to the bureaus oftentimes before you pay that bill. And if I looked at your credit report, and it shows a balance of five six $700. And you're like, wait a minute, I'm going to pay it this weekend. But on the report, it shows a balance of five to $600. It could actually lower your score a little bit. So you do want to be aware for that, of course, paying your balance in full is a good thing. But just understand if you're somebody that uses those cards a lot during the month. That balance could be reported at any given time. And if it shows up there, even before you pay the bill, it could lower the score a little bit. So the average interest rate for retail credit cards, Home Depot, Coles, Target, those kind of is about 25%. Answer to this one is true. So I often guys I get the especially for college students, oh boy, I'll get a student that says hey Mark, I've got a Coles card, and I've got $2,000 on it and it's at a 30% interest rate. Oh my goodness. So we got to make sure I usually start special when we're just starting out a visa mastercard discover a card you can use anywhere. These cards can be very expensive. If we're not paying them in full improving a credit whose score from 600 to 700 can be done within about three months with the right financial and credit moves. I'm just going to give you guys a chance. Brett, you're going to say true on this one I hope that's true. Oh Debbie, don't be mad at me please. Okay, I think Debbie is going to be mad at me with this one. Guys that's a myth. Yeah, don't worry Varada, it's okay. Has, has anyone ever been to sleeping bear dunes in nor in northern Michigan. Carrie. Have you ever climbed the sand dunes. When, when you're climbing the sand dunes. It's 30 or 40 minutes to get to the top of the hill. When you're coming down. Two to three minutes. It's the same thing with credit scoring. It's a gradual climb, but if something happens, you come down pretty steep. It typically takes guys anywhere from I would say nine to 12 months to improve a credit score 100 points. It's more of a gradual process. It takes, it takes time and patience. You can improve a credit score by in just a couple months. So it's, it's something that you know it's sort of a, you got to have some patients there. Ooh, how about this one. I hear this a lot closing credit cards can be an effective way to improve the score. Is this truth or myth. Wow. And Varada, you are emphatic on this one with the explanation points. You are and, and Carrie, the key to this one is focusing on the credit score. Okay. This is a myth. When you're closing credit cards, almost always have the impact where it will lower the score a little bit. The reason because that is, is because one of the factors of your credit score is overall available credit. When you close credit cards, it gets tighter. You lose that credit line. And what that means is it looks like you're using a greater percentage of your overall credit. I want to make sure you understand this credit report right here that I just shared with you. There is no reason for this person to have 40 open credit cards. Financially, we need to close some of these to start getting ourselves organized, but from a credit scoring perspective, if you were to tell me, hey, the best way to do it is to close all your cards. No, typically we want to keep them open and in good shape. I've got two more for you. In the United States, we have many different scoring models, and it's not uncommon for scores to be different, depending upon the source. Let's see what y'all think here. Yeah, a lot of truth. Yeah. Yep. And, and except Sarah, Sarah's being a little bit of a, but most of most of you guys are saying true on this one. This is the truth you guys. Very common. I will get somebody comes in and they say, Mark, on credit karma, it says 720 and on experience, it says 710. Sue's right, who's wrong. And I usually have to say guys, there are many different models out there. And our credit reports get updated multiple times throughout the month. So one report may not have identical data as the other. So sometimes sometimes the score is a little different. So I wouldn't worry that if, if you've got a couple different scores out there, it's typically because each of the credit bureaus have slightly different information on you. And there are a couple, there's a FICO model and there's a Vantage score model. And guess one, a credit freeze, this is a little bit on identity theft can be a good way to prevent fraudulent accounts from being opened in your name, and actually cause zero. Is this truth or myth. So Veretta, you're sure on this one may, Veretta, have you frozen your credit or, or, okay, you have, but you've heard of it. Okay. I've heard of it. I know someone has frozen it. Yeah. So that's why I say it's true. Yeah. And you are actually, you are actually correct. And I think maybe later in the fall, we'll do another workshop that focuses on like identity theft and fraud prevention. It's really interesting. But oftentimes it is important. You know, you always have as long as we're talking about credit, you do have the option to freeze your credit files, which essentially just means I don't want any new creditors or lenders from having access to this. Unless I open the door, unless I unfreeze it, and it really protects you from having anybody open accounts that are not yours in your name. Doesn't cost anything. These are the credit bureaus we have so just wanted to share that with you've ever heard that term credit freeze. It just allows all of us to sort of lock those files down. We don't, we don't want anyone looking at them except for ourselves and our existing creditors. So to summarize this section we want to make sure all our bills are getting paid. I have a lot of people that actually set up auto payments. So when the bill comes do it, they don't have to write the checkout it goes automatically utilization is think about how much you're using your cards during the month you guys. Let's make sure we target about 3035% or less. If you're somebody that's using 5060 70% of your credit line each month. That's going to lower the score a little bit. And credit is typically something that does take some time and patience. It's not a quick fix. Can we do it. Yes, but it's not a quick fix. So with anybody is like, gosh, I would love to really look at my credit score. This is a really neat app. It's credit karma. It's free to use. It's safe to use absolutely 100% safe. And multiple times throughout the week, your credit score will get updated based on new stuff that's hitting your credit report. So if if you are somebody that just likes to make sure that you've got good credit health. This is a really neat app to use. And so just wanted to share that with you at no cost. I had one last section that's only going to take five minutes, but I just wanted to hop up here. Are there any questions that I need to answer for you about that credit section. And if, if we get a thumbs up that's always a good thing to make sure we're doing doing okay. All right. So the last section here guys is is a little bit. A little bit more focused on just the importance of saving. And I know you guys all live in Michigan, just like me, anybody have these in their front or backyard. These little guys. I got them all over the place. And so I read a book. And this was over, I think it was last fall going into the winter. And you can imagine I probably read about a book a month for my job here. And I love this example. I have to give credit to the author, Tiffany Elise, she wrote a book about get good with money, really a fun book, 10 simple steps. And she had this example about savings that I loved. She says, be like the squirrel. And I'll read this to you she says in New Jersey and I'm telling you guys the same in Michigan, where I live, we get hit with the best and worst weather of four seasons. But even with the extreme highs and lows and temperature, you'll never see a sickly squirrel. They not only survive they thrive. Why because they adapt their behavior to seasonal change. And the seasons when acorns are in abundance. Those little squirrels don't mess around they get to work gathering and stashing acorns like nobody's business. And when winter arrives and acorn gathering isn't possible. They don't stand up hands on their hips and say wait, it's winter again. They knew it was coming, and they prepared for it. So, you know, as we reflect a little bit. Is there anyone on today's session that doesn't plan on retiring. And I'd love. Yeah, I know I want to retire someday. Is there anyone out there that that is is going to live the rest of their life with no unexpected expenses. I'd love to hear from you. You've got the floor. And that's the that is what, you know, oftentimes when we approach savings. We know you guys, sometimes this is going to, you know, both unexpected and expected. And I just like this example. I see the squirrels all over my yard, going crazy in the summer. And in the winter, they're just fine because they planned ahead. And so, you know, what I really kind of share with you, you know, how do we, how do we do be successful with our savings. My number one thing is make it automatic. Contribute to your retirement plan automatically. Have money move from checking the savings automatically set a rule with your bank or credit union. I'll tell you something that has gained in popularity at U of M and all put to direct deposits, split it, have 90% of your money go directly into your checking account. Take 10% of your money directly put it into your savings account. Maybe it's even at another bank or credit union completely different automatically put it over there. And I miss you that if you do that for a couple paychecks, you will very quickly after a month or so, you'll completely forget about the savings. You will adapt and you will learn to live on the money in your checking, and you're going to let that savings just kind of go. And so it's really an effective way anything you can do to take the work out of it, just set it on autopilot make it happen. And that's how you will have success. Carrie, if I could just maybe choose you for this one. And this one just kind of says saving money investing money as you look at those. Is that the same or different in your mind Carrie. It's very different savings to me implies essentially cash liquid cash whereas investing implies putting money into some longer term instrument that will reap rewards but probably with a time delay, there may be penalties for taking it out earlier, or not. Yeah, and Carrie I like that because I kind of heard when you when you mentioned savings, it was a little bit more that sort of that safety security type of thing. I'm saving for home improvement I'm saving for a down payment. I've got it I've got it specifically earmarked, and I really don't want to incur any risk. I need to make sure that money is there, whether it's underneath your mattress or sitting in a bank account I need to make a chair. And I think the objective is to grow our money over time. And we all know you guys that with that objective investing does carry some risk. Sometimes the markets up sometimes it's down, but over time history has shown us that it will, it will return, but that we really need to sort of kind of keep these separate. A lot of times, I will encourage people. If I, if I asked you, do you really feel that you've got a strategy for all three buckets. Number one, do you have an emergency fund. Do you have some dollars that you don't touch, and you would really only touch in the event of a job loss, a medical emergency, something like that, anywhere from let's say, three to four months of normal living expenses. That's an emergency fund. Number two, obviously the yellow bucket retirement is more is more longer term. Are we every paycheck do we set some money aside maybe we're even doing something individually like an IRA retirement is money that we're not spending and using until we leave work. And then the blue bucket is living life vacations down payments for a house or a car special occasions, just money that is not a bill every month but it's, it's money that we're going to need individually. I always encourage people to kind of broaden their definition of savings. And the last slide I will show you here, and I don't want to end it on a bad way, and a bad way. But think last year we guys, I think we're on the home stretch here for COVID, but this is an interesting study that was done last year. There's about 5000 people bank rate and they asked, thinking back to your financial situation prior to the coronavirus COVID, given everything that has since occurred, which one of these and they had about seven or eight listed was your biggest financial regret. Do I have any guesses that to what was actually the most common answer. What did people say and this was last summer. And let's see. Yeah, and brought savings, not enough savings and that yeah we're sort of kind of getting kind of getting that theme and and you guys are fairly right where I want you kind of couple different buckets. Look at the liquid was number one, not having that safety net. Do you remember last March or April how sudden things were changing. You guys I was working with people, and they're like, I can't get through to unemployment. I can't even you know I don't have any income. And we didn't have any emergency fund to help us for those couple months. So I'm just sharing this with you because gosh, anything we can do to be like the squirrel to plan ahead a little bit to protect ourselves as is a good thing. And then of course, saving for when we leave so all right. And good stuff. Well, I want to, I'm going to keep this slide up just for a minute because I want to make sure that if for any reason guys you do have, whether it's today or you ever want to reach or chat or send me a question individually, always feel free to do that can use me. I'm happy to always converse and and help. But if it's okay, I'm going to stop the screen share, because I kind of want to see everybody really quick. And now we're all kind of back together here. And just the last minute or two. Does anyone want to share, let's say a takeaway or something that maybe I shared today that got you thinking a little bit, and you can unmute yourself. Feel free to unmute yourself and just share something that was interesting or helpful today. Yes, Carrie, we do carry us individual counseling, carry the only thing I would I would preface with that is the only thing that I'm not allowed to do is give specific financial advice investing I'm not fidelity or TIA, so I couldn't tell you, oh, you need to get into Microsoft or this mutual fund. I'm not a financial advisor, mine would be more high level budgeting and credit and preparing to buy a home and those kind of things but it's either with me or I do have some other folks here at the credit union. So, yeah, you and I can chat offline and make sure that yep. Thanks, Dabby I did Catherine retired. Yep. So actually, I've been here four years now. Yeah. Hi, Mark, I just want to thank you because there's so many different sources out there that speaks to household budget. And I'm glad that you actually specifically said it's net, not growth. I mean, I've seen a lot of articles that, you know, say, you know, reference your growth. And I'm kind of going like thinking in my head that's not realistic. I don't pay my housing, you know, cost off of my growth. It's what's actually in my bank account. So thank you very much for, you know, confirming that it's actually met and not growth. Well, Veretta that's so interesting you say that I get asked to do a lot of seminars for graduating students, whether they're, whether they're your students or at other schools. And one of the things that I show them is most of the time students when they're in the job market, they, they are getting offers of 50,000 a year 70,000 a year grow salary. And I'm going to make an example I say guys. Realistically, when you're creating your month to month budget, you probably should take that gross salary and reduce it by 20 to 25% for health care, taxes, Medicare 401k, and the students eyes get like this. Oh my good, and you are exactly right, Veretta, we've got to make sure on a realistically, where yeah. So good stuff. All right, guys. Oh, Carrie, did you have a comment. Good to echo Veretta's thanks and thanks also to Veretta and the committee that put this together I really appreciate it so wonderful thing to have it presented by Rackham from a trustworthy source I really appreciate that so thank you everybody that put this together. And just in terms of today's presentation I really so much appreciate the discussion of credit and credit scores because I feel like those are so mysterious and we get so much conflicting information and it's just very helpful to have, you know, again a trusted source kind of explain what's going on. And I also very much appreciate the app recommendations because a lot of these things like I hear about them, but I'm not sure if they're trying to sell me stuff or which ones are safe or whether. So it's again very helpful to know recommendations from from someone that knows the industry and knows what to do. Carrie you're welcome and I promise you that I wouldn't suggest any apps that that either don't use myself or or our trustworthy for sure because there's a lot, you know, those are important and, and I definitely it's, I think when it comes to our money one of the things I typically say is, it's not a one size fits all for what works for you Carrie maybe your system, not exactly what Sarah does, but at the end of the day we're all kind of moving in the so whatever helps you stay organized and managed, I'm okay with that. And so that's, that's, I'm glad that you picked up a few things there so good stuff. Yeah. Well, Verona, I just for meeting with you, Mark. Now, never, Debbie, never. Yep. And, and a lot of times I will hopefully eventually we'll get back to a situation where we can actually kind of do it in person, but I'm doing a lot right now either through the phone or for video. Whatever works but no, I just I typically designate a couple days during the month for for individual meetings. It's really totally whatever you'd like to focus on. So good stuff. Well, Verona, thank you for the invitation to meet your colleagues. Absolutely Mark, thank you so much for coming. And I believe we're going to take you upon your offer about financial plans and fall. We, we should, we should do that again in the fall. It's a good it's very good. It's a lot of, you know, some good do's and don'ts to protect ourselves. Yeah, yeah, yeah. And so, again, I'll present that to our Health and Wellness Committee. And I think they will be agreeable with that because this one right here is, is this has just been so rich, and I really, really appreciate shoes on the bottom of my heart I truly appreciate you spending your time with us on the day. Yeah, yeah, thank you so much for agreeing to be recorded because I'm quite sure that there are other colleagues that would really benefit, you know, from the session. And again, I definitely believe we're going to take care of on that financial scam, you know, workshop in the fall. Yeah, because I've been noticing myself. I, I get a lot, but I don't know how they get myself a number, but I've been getting a lot of things on myself and I'm kind of going are you, are you kidding me, you know, and so, you know, there are people out there that will click on that link. Unfortunately, when they click it on, they might just call it clickbait when they click on to it, they can actually hack into a lot of the information through your phone, especially if you keep, and you shouldn't do this if you keep passwords or if you keep any kind of financial information on your phone, we know that it is, you know, convenient, but I don't think that that's a good practice so I think that you know there are some, you know, pretty bad guys out there that's actually taking advantage of that. Agreed. Yeah, yep. Yep. So thank you if no one else has, you know, huh. No, I was absolutely and it was a pleasure to meet everybody today I'm glad. I really appreciate you guys engaging through the chat box and stuff. Answering all those questions and stuff so good stuff. Yeah, yeah, definitely keep in touch for a lot of love to work with you guys. Yeah. Please. Yeah, just a quick request. I didn't get to copy down your email mark before the screen went out. I was wondering, Veretta, if you could pass that to us. Yes. Yeah. Thank you. Oh, there it is. Okay. Yeah, I know it's a super long last name. Thank you. Sorry for the delay. I appreciate it. Here we go. So guys have a great rest of the week. Okay, keep in touch. Take care guys. Bye.