Your top 4 money management questions, answered by our experts

By Jewelle Saunders

The YLAI Network hosted three experts on financial planning for a Facebook chat in March 2020 for Global Money Week for network members.

Our experts, ThrivingDollars‘ Kenishia S. Mais, Desde Cero Finanzas‘ Julio César Pineda and North Central College‘s Dr. Ryan Decker, helped you work through your most pressing money management questions. From debt management and saving tips to investment inquiries, you have money on your mind.

To best address these pressing questions for those unable to participate, we included below your top four money management questions, answered.

How can I save money?

Dr. Decker recommends that you first start with a goal. Ask yourself: What do I want to save for? That will provide you something to aim for. If you have a goal in mind it should provide you with more motivation to stick to a budget. Perhaps even come up with a realistic dollar amount to save by a certain date. Then, track what you spend and look for areas to save. This is a defensive approach to money management — limiting your expenses and working savings into your budget. An offensive approach to money management would be to try to make more money, by focusing on learning new skills, picking up extra hours and finding additional work.

Julio suggests saving above all extraneous spending. “You have to save first and then pay your bills. At the beginning, it could be hard, but for that, you have to make a budget, check all the bills and try to reduce those that are over your payment capacity.” Many financial experts suggest making saving a priority. After receiving your income, consider paying your bills and putting a small amount into savings before making excess purchases.

No budgeting method looks the exact same for every person. Find what best fits your needs and your lifestyle. Read more here to determine what methods might work for you.

How can I get out of debt?

Dr. Decker says there are two main approaches to paying down debt. One is where you pay down the loan that has the highest interest rate first, thereby saving you the most money. Otherwise, “many advocate for the snowball method, where you first ensure all minimum payments are met and then devote extra money to paying off the smallest balance first and then take that monthly payment and devote it to the next largest loan, and so forth.”

Julio advises that it could be a good idea to implement the snowball method to get out of debt. Another thing you have to do is reduce some expenses. To do it, he recommends to start tracking all the expenses to know where your money goes and then reduce those that are not essential right now.

When looking at personal financing apps and resources, Dr. Decker recommends exploring which apps are available and might best fit your needs. He recommends: “If budgeting, Mint is a longtime staple, and if you’re a student, the most popular app now is You Need a Budget (YNAB). It’s a resource and has a fairly robust online community of users to talk about budgeting and debt.”

What is your advice for a beginner investor?

Dr. Decker recommends buying low-cost index funds and diligently saving every week/every month, as every little bit will add up. Be wise to take an appropriate amount of risk given your goals. You can take more risk (more stocks) with money saved for 20–30 years. Take less risk, or no risk, (more bonds or cash) for goals in the next 10 years. He also recommends utilizing tools like mobile apps, such as Personal Capital, which is a great free resource for investing.

“Time in the market is more important than timing the market,” says Dr. Decker. “If you’re saving for the long term, turn off the financial entertainment news and just invest/save as much as you can.”

Kenishia provided further resources for those looking to get started with investing. Make sure to read her posts 4 things to get started with investing and 4 simple steps to overcome your fear of investing.

What are the key steps to growing and funding a business?

Kenishia proposes the following four tips for how to approach starting a successful business:

  1. Put together a proposal of your idea. Include what the benefits to the community will be, as well as the benefits for potential partners. You also need to include the cost of the project.
  2. Reach out to other young professionals who may be interested in partnering with you to bring this to fruition. Even if they can’t partner with you financially, they may bring other areas of expertise to the project that you are missing, which is ultimately valuable. Read this blog as well for some tips on finding a business partner.
  3. Reach out to companies/organizations in your country whose corporate social responsibilities include projects like yours and ask them to fund your initiative.
  4. You may not get a yes at first, or on your first few attempts. Keep asking. Ask as many organizations (and if possible, your government) until someone comes on board.

Bonus: Keep an eye out for international grants that are looking to fund projects like yours that you can apply for.

Securing funding is the next challenge most entrepreneurs face. Here are a few blogs that discuss grassroots ways to fund a startup.

This article is available in Spanish.