On Take it to the Bank,
00:00:01.36\00:00:02.70
you'll find ways
to get out of debt.
00:00:02.73\00:00:05.67
Solve your credit card problems.
00:00:09.50\00:00:14.58
How to make and
stick with the budget,
00:00:14.61\00:00:16.85
simple ways to save,
00:00:19.88\00:00:21.68
buying or selling a home
and many more financial matters
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on Take it to the Bank.
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Hi, my name is Cordell Thomas
00:00:31.83\00:00:33.56
and I'm here with
Take it to the Bank.
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Excited about this program
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because there is some
interesting information
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that actually just came in.
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There was a story
written just the other day
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about how banks are
beginning the process now
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of raising fees
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and targeting
specific type of customers
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that are profitable
or unprofitable for them.
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And it's kind of an
interesting conversation
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because now they are saying
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that you are only
a profitable customer
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if you bring about $100,000
worth of assets to the table,
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assets or investments
to the table to that bank.
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So basically if you have
own a home, you have, you know,
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$10,000 worth of
savings this and that the other,
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they're basically
saying that type of customer
00:01:09.63\00:01:11.67
we can predict is profitable.
00:01:11.70\00:01:13.64
Now, the tensions
between banks and customers
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it's actually
reached a fever pitch
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over the past few weeks,
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based on, you remember the bank
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that was trying to charge
five dollar debit card fees
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for the use of the machines
last year and, of course,
00:01:28.42\00:01:32.79
what we saw with the backlash.
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And, of course, that
was interesting to see
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such a large bank say,
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"All right, we'll back off,
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well, we won't do
anything about that,"
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but they are
still in it to win it
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because banks are businesses
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and they are
there to make money.
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The financial crisis of the past
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caused them a lot of money,
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lot of foreclosures
cost them a lot of money,
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and they are
trying to figure out
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how they can
make that money back.
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I was online the other day
and I looked one major bank
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and they looked at profits
over the past year $1.9 billion,
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$1.9 billion with a B.
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You all
remember, or you remember
00:02:07.92\00:02:10.23
how we calculated a billionaire
00:02:10.26\00:02:11.59
and put in a
context is if you spend
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a dollar a second,
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it takes you approximately
12 days to spend $1,000,000,
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a million with an M.
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If you do that same
thing, one dollar a second,
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how much time will it
take to spend a billion?
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Well, it turns out
that's about 31 years, 32 years.
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That's doing a
dollar a second non-stop
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and if you get that
context that's a lot of money.
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So these banks are
making a lot of money
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and they are finding
ways to be more profitable.
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What are they doing?
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They are looking at you,
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maybe a risk your
customer then most
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and there are trying to get
you to sign on with a credit.
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And so there
getting more credit,
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increasing their market
share, and they are doing that
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because it brings them funds.
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Because what are they
doing with your future payments
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on the credit card?
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They are
bundling these financial,
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these assets,
00:03:03.88\00:03:05.21
and they are
selling them to investors.
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So they make money.
00:03:07.62\00:03:08.95
The investors are
banking on the fact
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that you will either
pay or you may not pay,
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but they are insured on that
00:03:12.82\00:03:15.16
so they're still
gonna money regardless.
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But it's banking on
you, on your future payments
00:03:17.26\00:03:20.20
which means
that they are saying,
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"We know you are
gonna get in debt.
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We know they are
gonna use credit cards
00:03:24.30\00:03:26.50
and we know you probably not
gonna be able to pay them off."
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So what's going to
happen is the long-term
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they have to pay
the minimum payments,
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we will make money on
that interest on that money
00:03:33.54\00:03:37.91
and we will be
able to make more money.
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Of course, the context
00:03:40.05\00:03:41.65
is they are doing in
money different ways also.
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You go to a bank...
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I have banking at
different separate banks.
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One has hold to my
mortgage, of course,
00:03:47.66\00:03:50.43
and then I'm
considered because of mortgage,
00:03:50.46\00:03:52.29
and savings, and checking
00:03:52.33\00:03:54.13
and that kind of
thing and, of course,
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I have then
profit over there too.
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I'm a premier customer.
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Why?
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'Cause that's true,
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I have, they have
over $100, 000 more or more
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of investments and, of
course, assets according to me.
00:04:05.67\00:04:09.81
Now, if you are
not in that level
00:04:09.84\00:04:13.58
and you are at a different bank,
00:04:13.62\00:04:15.52
which you have
another account at,
00:04:15.55\00:04:16.89
they nickel-and-dime
you for everything.
00:04:16.92\00:04:19.02
If your account goes
under a certain amount
00:04:19.05\00:04:20.96
they will charge
you, if you, of course,
00:04:20.99\00:04:23.16
if you bounce a check
00:04:23.19\00:04:24.53
they are gonna
charge a large amount.
00:04:24.56\00:04:27.33
If you are asked
for specific services
00:04:27.36\00:04:30.07
and now seeing that
they look at it that way,
00:04:30.10\00:04:32.80
banks maybe getting
better at figuring out
00:04:32.83\00:04:36.47
when they have to raise fees
00:04:36.50\00:04:38.81
and which customers
they can afford to lose,
00:04:38.84\00:04:43.01
afford to lose.
00:04:43.04\00:04:44.38
So when you take a look at
what banks are trying to do now
00:04:44.41\00:04:47.35
is they're
treating their organization
00:04:47.38\00:04:50.39
as a corporation
00:04:50.42\00:04:51.79
and they are
looking at mitigating loss,
00:04:51.82\00:04:53.99
and maximizing profitability,
00:04:54.02\00:04:56.32
and they are now
looking at targeting customers.
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You know how it is.
00:04:58.23\00:04:59.56
If you are, I, I've
noticed the difference.
00:04:59.59\00:05:01.13
As a premier
customer, if I call up to bank
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I don't wait long,
00:05:04.07\00:05:05.53
I get right through immediately,
00:05:05.57\00:05:06.90
I've noticed that
00:05:06.94\00:05:08.27
and I've asked the
bank to actually that
00:05:08.30\00:05:09.80
because we had
friends in the industry.
00:05:09.84\00:05:11.81
They have it labeled
to a way that they know
00:05:11.84\00:05:14.08
who's you're premier
00:05:14.11\00:05:15.44
and who is just
a regular customer.
00:05:15.48\00:05:16.81
If you are a regular customer,
00:05:16.85\00:05:18.18
you're gonna wait in line
you can wait 5, 10, 15 minutes
00:05:18.21\00:05:21.05
to get through, though a banker
00:05:21.08\00:05:22.65
if you're calling them up,
00:05:22.68\00:05:24.02
but if you're premier customer,
you don't wait that long.
00:05:24.05\00:05:25.99
There are a lot of little perks
that are in there because now,
00:05:26.02\00:05:28.82
as a customer of this bank,
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I don't have to pay
for certified checks,
00:05:30.49\00:05:32.83
the preparation of money orders,
00:05:32.86\00:05:34.30
I don't pay for the preparation
of travelers' checks,
00:05:34.33\00:05:37.67
if I'm traveling along
around the place, varying funds,
00:05:37.70\00:05:40.84
they actually provided me
00:05:40.87\00:05:42.50
my corporation
bank checks for no cost.
00:05:42.54\00:05:47.24
It was a fantastic
perk. I really appreciate it.
00:05:47.28\00:05:49.78
That's a significant
cost when you think about it.
00:05:49.81\00:05:51.91
And you understand
00:05:51.95\00:05:53.35
what they're thinking about now,
00:05:53.38\00:05:54.98
this is just news
that has been provided
00:05:55.02\00:05:58.85
in the news industry
00:05:58.89\00:06:00.29
and I think it's something
that's relevant to you.
00:06:00.32\00:06:01.92
As we talk about finances
00:06:01.96\00:06:03.76
and we talk about
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how these things
impact our lives,
00:06:05.16\00:06:06.56
it's important to realize
that as we mange our funds,
00:06:06.59\00:06:11.37
and we save our funds,
00:06:11.40\00:06:12.73
and we act in a
way that is organized
00:06:12.77\00:06:17.84
and we approach it
00:06:17.87\00:06:19.37
in a calculated manner
of saying that I wanna save,
00:06:19.41\00:06:22.51
I wanna make sure that
I don't let my expenses
00:06:22.54\00:06:26.25
exceed my income,
00:06:26.28\00:06:27.82
those type of things hold true,
00:06:27.85\00:06:29.52
so that if you can
have a savings account
00:06:29.55\00:06:31.35
of $50, 000 or $60,000
00:06:31.39\00:06:33.29
and if you can buy a home
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and have a long-term
relationship with bank,
00:06:35.39\00:06:38.09
one banking entity,
00:06:38.13\00:06:39.46
it works out to
your best interest.
00:06:39.49\00:06:41.46
But now banks are saying
00:06:41.50\00:06:43.67
that they're
going to pick and chose.
00:06:43.70\00:06:45.37
And with the level of
people, the number of people
00:06:45.40\00:06:50.47
that are upset with banks
based on what just happened,
00:06:50.51\00:06:52.71
people are
changing banks at the tune
00:06:52.74\00:06:55.94
of last year 9.6%
customers switched their banks
00:06:55.98\00:06:59.95
which was up from 2010 and 2011
00:06:59.98\00:07:03.15
where it was 7.7%
and 8.7% respectively.
00:07:03.18\00:07:06.92
So people are now
taking more control,
00:07:06.96\00:07:08.82
we can began to see that now,
00:07:08.86\00:07:10.19
and they're saying if
they are not comfortable
00:07:10.23\00:07:11.83
with their current
banking relationship,
00:07:11.86\00:07:14.16
they take it upon
themselves to change it
00:07:14.20\00:07:17.37
and in some cases it
works out well for them
00:07:17.40\00:07:19.33
and some cases it
doesn't not work out that well,
00:07:19.37\00:07:21.64
depending on where you go.
00:07:21.67\00:07:23.61
So as you take a
look at where you go,
00:07:23.64\00:07:25.81
understand that
many of us may not have
00:07:25.84\00:07:27.44
the $100,000
worth of investments
00:07:27.48\00:07:29.24
and assets that a
bank would like to have
00:07:29.28\00:07:31.85
to choose you
00:07:31.88\00:07:33.21
as a potentially
profitable client.
00:07:33.25\00:07:36.35
But that doesn't mean
you don't have any outlet.
00:07:36.38\00:07:38.65
As a matter of facts,
they looked during that article
00:07:38.69\00:07:44.96
at what you can do
00:07:44.99\00:07:46.70
and they're providing
a short shopping guide
00:07:46.73\00:07:48.53
for customers,
financial customers
00:07:48.56\00:07:50.53
who are under
that $100,000 category.
00:07:50.57\00:07:54.10
Don't bundle big money,
00:07:54.14\00:07:56.30
don't bundle a lot
of big money and tied up
00:07:56.34\00:07:58.81
because you know that
your mortgage interest
00:07:58.84\00:08:01.08
is federally
insured up to $250,000.
00:08:01.11\00:08:04.08
If you have a million dollars
00:08:04.11\00:08:05.45
I...recommending what you do
00:08:05.48\00:08:07.72
but if you're just
insured up to $250,000,
00:08:07.75\00:08:12.45
put $250, 000 in
each account at each bank
00:08:12.49\00:08:15.19
so that if something happens
00:08:15.22\00:08:16.93
you're insured up to the
amount that you have there.
00:08:16.96\00:08:18.29
If you have a
million in one bank
00:08:18.33\00:08:19.66
and something happens,
00:08:19.69\00:08:21.03
you're insured up to
that $250,000 amount.
00:08:21.06\00:08:23.47
Bundle little money,
00:08:23.50\00:08:24.83
many banks require a
minimum monthly balances
00:08:24.87\00:08:27.84
of approximately $2,000
or so for free checking.
00:08:27.87\00:08:31.07
So you can get free
checking if you tie up,
00:08:31.11\00:08:33.04
if you're willing
to tie up about $2,000
00:08:33.07\00:08:35.94
without getting
any interest for it.
00:08:35.98\00:08:37.61
That's, that's
and then, of course,
00:08:37.65\00:08:40.02
you will probably
qualify for the free checking
00:08:40.05\00:08:41.82
and avoid any type of
overdraft problems also.
00:08:41.85\00:08:45.29
But I think one of
the best recommendations
00:08:45.32\00:08:47.46
that are out there
00:08:47.49\00:08:48.82
is to seek upstart alternatives.
00:08:48.86\00:08:52.23
Small community
banks are now hiring
00:08:52.26\00:08:55.06
marketing front companies
00:08:55.10\00:08:56.50
to build online
businesses for them,
00:08:56.53\00:08:59.27
companies such
as, well, I, you know,
00:08:59.30\00:09:02.50
companies such as those that
are online and have capacity.
00:09:02.54\00:09:06.01
I'd ask you to go online
00:09:06.04\00:09:07.38
and do a search of those type
of businesses that are online,
00:09:07.41\00:09:10.51
so you can get a
context of those that offer
00:09:10.55\00:09:14.08
a verity of banking accounts.
00:09:14.12\00:09:15.62
They're FDIC
insured, via web portals
00:09:15.65\00:09:19.05
and they've identified online
00:09:19.09\00:09:22.62
if you go in and do a
quick search about ten banks
00:09:22.66\00:09:25.26
offering free checking accounts.
00:09:25.29\00:09:27.53
Seconds issue, use automated,
00:09:27.56\00:09:29.43
you can use
automated investments services.
00:09:29.46\00:09:32.60
You don't have to go
to the big organizations
00:09:32.63\00:09:36.44
that typically provide
00:09:36.47\00:09:39.11
these types of
investment strategies.
00:09:39.14\00:09:40.78
They have online
strategies that you can get
00:09:40.81\00:09:42.88
for relatively
inexpensive amount
00:09:42.91\00:09:45.18
and they can
make stocks and bonds,
00:09:45.21\00:09:47.15
low fee funds that
you can get access to
00:09:47.18\00:09:49.72
if you have now
in place your budget
00:09:49.75\00:09:53.86
which tells you where
your expenses are going,
00:09:53.89\00:09:56.69
where your paycheck and
the revenue is coming from.
00:09:56.73\00:09:59.29
And that difference
between expenses and income
00:09:59.33\00:10:02.80
gives your savings
and possibly moneys
00:10:02.83\00:10:06.13
that you can invest,
00:10:06.17\00:10:08.30
invest and those are
things that we talk about
00:10:08.34\00:10:12.11
when we're looking at
setting financial goals.
00:10:12.14\00:10:14.78
I read a couple of things online
00:10:14.81\00:10:17.55
and they said to set
00:10:17.58\00:10:19.35
and prioritize
your financial goals,
00:10:19.38\00:10:21.55
set them short-term,
mid-term, and long-term
00:10:21.58\00:10:24.25
it tells you where you need
to put your funds specifically
00:10:24.29\00:10:27.49
if you want to get
immediate access to it.
00:10:27.52\00:10:29.79
So if you have an emergency fund
00:10:29.82\00:10:31.33
what does it tell you?
00:10:31.36\00:10:32.69
It says, "Hey, I can get
to this money, its liquid,
00:10:32.73\00:10:36.03
I can get it without
paying any type of penalty."
00:10:36.06\00:10:38.33
If it is funds
00:10:38.37\00:10:39.70
that you're
putting away for retirement
00:10:39.73\00:10:42.44
or a longer-term,
mid-term, long-term,
00:10:42.47\00:10:44.64
then it's something
you don't wanna touch.
00:10:44.67\00:10:47.41
There is a penalty
to go get access to it
00:10:47.44\00:10:49.91
and those are things
that you set for long-term.
00:10:49.94\00:10:53.72
Now do you know how much
in one year you could save,
00:10:53.75\00:10:56.52
if you save 35 cents per day?
00:10:56.55\00:11:00.29
Think about that for second,
00:11:00.32\00:11:01.66
35 cents a day for
the course of one year.
00:11:01.69\00:11:03.83
How much do you have saved?
00:11:03.86\00:11:05.39
And how does that
apply to the bigger picture?
00:11:05.43\00:11:07.63
Because what we are gonna
talk about at this juncture
00:11:07.66\00:11:11.13
has to do with the
consequences of not planning,
00:11:11.17\00:11:15.47
the
consequences of not planning.
00:11:15.50\00:11:17.71
What happens is long-term
00:11:17.74\00:11:19.64
if you don't have
future plans in place
00:11:19.67\00:11:21.94
you're not thinking about
the potential for a job loss
00:11:21.98\00:11:25.61
or the potential for
some major type of emergency.
00:11:25.65\00:11:30.52
And these are the type of things
00:11:30.55\00:11:32.15
that we'd liked to talk about
00:11:32.19\00:11:33.66
over the course of
the next few minutes.
00:11:33.69\00:11:35.46
So, with that said,
00:11:35.49\00:11:37.16
I wanna take you to a
couple of interviews I did
00:11:37.19\00:11:40.00
while we were at the
beach and talking to the people
00:11:40.03\00:11:42.60
in a supposedly
relaxed environment
00:11:42.63\00:11:44.53
and asking them
that same question,
00:11:44.57\00:11:46.87
"What do you
considered the top three crises
00:11:46.90\00:11:50.44
that families encounter?"
00:11:50.47\00:11:51.87
And I like you to
take a look as we listen.
00:11:51.91\00:11:56.08
What do you
consider the top three crises
00:11:56.11\00:11:58.41
that families are
dealing with today?
00:11:58.45\00:12:00.18
Probably top
three crises are money,
00:12:00.22\00:12:02.05
money is one of them.
00:12:02.08\00:12:03.42
And then just like inner
family conflict stuff like that
00:12:03.45\00:12:07.36
I would say.
00:12:07.39\00:12:08.72
Probably the
third one, I don't know,
00:12:08.76\00:12:12.53
the third one just maybe
spending time all together
00:12:12.56\00:12:15.90
like the old
families used to, you know.
00:12:15.93\00:12:18.13
My family would be money, work.
00:12:22.10\00:12:25.24
and probably
other family problems.
00:12:25.27\00:12:27.81
You know what I mean?
00:12:27.84\00:12:29.18
Issues and nonsense
that other people bring
00:12:29.21\00:12:32.21
into a play and,
00:12:32.25\00:12:34.52
my Dad his, whole
work, work, his girl,
00:12:34.55\00:12:40.99
and money, I mean,
that's the main things.
00:12:41.02\00:12:43.06
All right.
00:12:43.09\00:12:44.43
Top three? Top three.
00:12:47.70\00:12:49.66
Financial, work, marriage.
00:12:49.70\00:12:55.04
Its interesting same key issues,
00:12:58.07\00:13:00.88
financial issues,
00:13:00.91\00:13:02.24
personality
issues, family issues.
00:13:02.28\00:13:05.11
We've talked earlier
00:13:05.15\00:13:06.48
and I was
talking about the banks
00:13:06.51\00:13:07.85
and it was kind of interesting
00:13:07.88\00:13:09.22
I really wanna
share this with you
00:13:09.25\00:13:10.59
because if I don't,
00:13:10.62\00:13:11.95
I will have pass
this opportunity there
00:13:11.99\00:13:13.32
to share with.
00:13:13.36\00:13:14.69
It tells one of the things
that customers are now taking
00:13:14.72\00:13:16.52
at upon themselves to complain.
00:13:16.56\00:13:19.29
I mean, with banks
00:13:19.33\00:13:20.66
and any kind of
customer service arena
00:13:20.70\00:13:22.76
and banks specifically is what
we talked about initially with
00:13:22.80\00:13:25.33
some of the changes
that are going on there,
00:13:25.37\00:13:26.74
so they're challenge
00:13:26.77\00:13:28.10
and they know their customers
are gonna make decisions,
00:13:28.14\00:13:30.04
but their customers also
00:13:30.07\00:13:32.27
are fairly clear
with the customers
00:13:32.31\00:13:35.21
that if they have
problem, complain.
00:13:35.24\00:13:37.38
And so what we are finding is,
00:13:37.41\00:13:39.28
if you feel that you're wrong
there is a place you can go
00:13:39.31\00:13:42.48
the new Consumer Financial
Protection Bureau said that,
00:13:42.52\00:13:46.45
they're excepting
customer or consumer complain
00:13:46.49\00:13:50.06
about bank accounts
and you can go, and talk,
00:13:50.09\00:13:54.63
and complain if
there is a specific concern
00:13:54.66\00:13:57.17
which is why it's
quite interesting.
00:13:57.20\00:13:58.80
Because you can
file a complaint,
00:13:58.83\00:14:00.94
you can print it out,
00:14:00.97\00:14:02.30
and you can take
that to the bank.
00:14:02.34\00:14:06.27
Sounds familiar
to you, doesn't it?
00:14:06.31\00:14:07.64
Actually it's pretty cool
because you now have an outlet,
00:14:07.68\00:14:11.08
the better businesses
viewer has a place also,
00:14:11.11\00:14:12.88
which I utilized when
I had a unfair dealing
00:14:12.91\00:14:15.92
that I had at a dry cleaners.
00:14:15.95\00:14:17.95
And there are options for
you in any case when you feel
00:14:17.99\00:14:21.22
that you've been
slided by an organization
00:14:21.26\00:14:23.19
because this is real money,
00:14:23.22\00:14:25.43
it's money out of your
pockets that you put into,
00:14:25.46\00:14:28.53
for example, a bank.
00:14:28.56\00:14:30.27
That bank takes
your money and says,
00:14:30.30\00:14:31.73
"Oh, thank you for
letting us use your money
00:14:31.77\00:14:34.37
and we are gaining 18%, 20%, 22%
00:14:34.40\00:14:37.31
on return on your
money, which we turnaround
00:14:37.34\00:14:40.64
and say to you
here is your 1% or 2%".
00:14:40.68\00:14:43.24
So they are using
the funds that you have,
00:14:43.28\00:14:45.81
there are uses for banks
00:14:45.85\00:14:48.28
and I ask you to take care
00:14:48.32\00:14:49.65
as you chose the
bank that you have
00:14:49.68\00:14:51.02
it could be a
physical brick-and-mortar
00:14:51.05\00:14:54.26
or it could be a virtual bank
00:14:54.29\00:14:56.79
that you can
access via a web portal.
00:14:56.83\00:15:00.40
But what we're
talking about today
00:15:00.43\00:15:02.33
via these actual interviews
00:15:02.36\00:15:05.90
had to talk
about top three crises
00:15:05.93\00:15:08.20
that families deal with
00:15:08.24\00:15:09.57
and it has to do with
money and relationships.
00:15:09.60\00:15:11.91
It all has to do with money.
00:15:11.94\00:15:14.64
I had talked earlier that
there is an article out there
00:15:14.68\00:15:17.41
about what some people,
smart people happy people,
00:15:17.45\00:15:21.95
are individuals that don't
concern themselves with money.
00:15:21.98\00:15:25.92
They have money,
they can make more money
00:15:25.95\00:15:27.52
if they chose to,
00:15:27.56\00:15:28.89
but they're not
worried about money
00:15:28.92\00:15:30.39
because they
have what they need,
00:15:30.43\00:15:32.39
they have a
conservative approach to life,
00:15:32.43\00:15:34.63
and they enjoy life.
00:15:34.66\00:15:36.60
And it doesn't mean
that they don't spend it,
00:15:36.63\00:15:38.17
they spend it, they do
things because they have planed.
00:15:38.20\00:15:42.00
They have done what
they have to do early on
00:15:42.04\00:15:44.87
to ensure that they are
meeting there obligations
00:15:44.91\00:15:47.88
and planning for the future
00:15:47.91\00:15:49.24
with not only
themselves as a family
00:15:49.28\00:15:51.61
but their children accordingly.
00:15:51.65\00:15:53.62
But then, the
context of this is,
00:15:53.65\00:15:55.98
"What happens
when a crisis happen?"
00:15:56.02\00:15:57.89
Top three crises have
to do with money, job loss,
00:15:57.92\00:16:01.09
medical emergencies,
those type of things.
00:16:01.12\00:16:03.89
Let's take a look.
Let me ask you a question.
00:16:03.93\00:16:06.86
What you do
00:16:06.90\00:16:08.93
when you just lose a
job or go through a layoff?
00:16:08.96\00:16:11.77
What you do?
What's your first step?
00:16:11.80\00:16:14.34
How do you approach it?
00:16:14.37\00:16:15.80
Have you planned for it
00:16:15.84\00:16:17.34
from a standpoint
of future planning
00:16:17.37\00:16:20.21
and future type of emergencies?
00:16:20.24\00:16:23.91
I would say, let me
ask a different question.
00:16:23.95\00:16:27.18
You just begin a new job
00:16:27.22\00:16:28.98
and they require you to
pay the expanse to move,
00:16:29.02\00:16:32.59
does that happen?
00:16:32.62\00:16:33.96
It does.
00:16:33.99\00:16:35.32
Where do you get the money from?
00:16:35.36\00:16:36.69
Do you have the
emergency account setup?
00:16:36.73\00:16:38.06
Have you budget it accordingly
for this type of emergency?
00:16:38.09\00:16:42.46
And it is an emergency.
00:16:42.50\00:16:43.83
You wanna move,
you wanna make money,
00:16:43.87\00:16:46.03
you wanna continue
the process of supplying
00:16:46.07\00:16:49.07
the needs for your family,
00:16:49.10\00:16:50.47
but then "I don't
have the savings in place
00:16:50.51\00:16:54.54
the emergency funds in
place to handle this new issue"
00:16:54.58\00:16:58.45
because most companies will say,
00:16:58.48\00:17:00.28
"We'll relocate you.
00:17:00.32\00:17:01.65
We'll pay for your
relocation expenses.
00:17:01.68\00:17:03.02
We'll pay for you to
get where you need to go".
00:17:03.05\00:17:04.65
But some don't.
00:17:04.69\00:17:06.02
And these are things to look at.
00:17:06.05\00:17:07.39
This can come
right out of the blue
00:17:07.42\00:17:08.92
and put a shock into
your financial status
00:17:08.96\00:17:11.86
and your budget.
00:17:11.89\00:17:13.23
What about an
auto accident happens?
00:17:13.26\00:17:17.13
The auto, it
needs to be retired,
00:17:17.17\00:17:19.73
it just breaks down and
doesn't want to go anymore,
00:17:19.77\00:17:21.77
or you have to go
through a major repair.
00:17:21.80\00:17:25.04
This is another major item
that can influence how you deal
00:17:25.07\00:17:29.81
with the loss of income
00:17:29.84\00:17:31.18
as well as dealing
with a medical emergency,
00:17:31.21\00:17:34.05
or just an
emergency that comes up
00:17:34.08\00:17:36.72
that can happen in
any form or fashion,
00:17:36.75\00:17:40.19
are you planning for it?
00:17:40.22\00:17:42.06
Do you deal within
the right type of way?
00:17:42.09\00:17:44.16
We find that people
00:17:44.19\00:17:46.43
who plan are
people who are happy,
00:17:46.46\00:17:50.57
people seem to be in
a better state of mind
00:17:50.60\00:17:52.93
because they're not worrying
about this issue out here
00:17:52.97\00:17:55.87
because if I need
a new water heater,
00:17:55.90\00:17:58.21
I have that savings account
00:17:58.24\00:18:02.14
that can fund that acquisition,
00:18:02.18\00:18:05.65
which leads to a
couple of other questions
00:18:05.68\00:18:07.45
which I'll bring up in a minute.
00:18:07.48\00:18:08.82
But I'll ask a few more.
00:18:08.85\00:18:11.15
What happens when you
have a major home expense,
00:18:11.19\00:18:14.42
a broken water line, a
tree falling on your roof,
00:18:14.46\00:18:17.26
fire, natural disasters,
00:18:17.29\00:18:18.79
which goes to whole
other area of insurance
00:18:18.83\00:18:22.40
and insurance protection?
00:18:22.43\00:18:23.80
We do know that
there is a great deal
00:18:23.83\00:18:27.04
of insurance fraud
that's going on out there.
00:18:27.07\00:18:29.50
We do know that there are things
00:18:29.54\00:18:30.94
that create anxiety in our lives
00:18:30.97\00:18:33.71
and can we overcome that?
00:18:33.74\00:18:35.24
And do we have the
right type of insurance,
00:18:35.28\00:18:37.01
homeowners
insurance, renters insurance,
00:18:37.05\00:18:40.05
you knew that you need to get
00:18:40.08\00:18:41.75
or should have
renters insurance,
00:18:41.78\00:18:43.42
insurance on your car?
00:18:43.45\00:18:44.99
These are all things
which will mitigate the loss
00:18:45.02\00:18:49.12
because we have that
insurance mechanism in place
00:18:49.16\00:18:52.66
that will help to
make you whole again.
00:18:52.69\00:18:56.56
How about pet healthcare?
00:18:56.60\00:18:58.80
If you have a pet, you
have to take care of the pet.
00:18:58.83\00:19:01.30
That's a major
responsibility too
00:19:01.34\00:19:03.34
and there are money
outlets that need to happen
00:19:03.37\00:19:05.87
from that standpoint.
00:19:05.91\00:19:07.24
What happens when you
have an unexpected tax
00:19:07.28\00:19:09.68
that you owe the IRS,
00:19:09.71\00:19:11.31
relevant to a lot of
people and especially now
00:19:11.35\00:19:13.98
that were in tax season
00:19:14.02\00:19:15.75
there are audits
that will be ongoing
00:19:15.78\00:19:17.75
throughout the
course of the year
00:19:17.79\00:19:19.12
and are you're
prepared for an audit
00:19:19.15\00:19:20.66
if one should come
across your front porch?
00:19:20.69\00:19:24.19
What happens if
an unexpected death
00:19:24.23\00:19:26.33
in the family that requires
you to help pay funeral costs
00:19:26.36\00:19:29.36
and other expenses?
00:19:29.40\00:19:30.73
When my father
passed away in Jamaica
00:19:30.77\00:19:34.97
we had to take care
of those type of things
00:19:35.00\00:19:37.84
and it was
tremendous type of burden
00:19:37.87\00:19:41.24
when you had to
pay for certain things
00:19:41.28\00:19:43.08
that were not
necessarily covered
00:19:43.11\00:19:45.35
through whatever
programs and insurance packages
00:19:45.38\00:19:48.08
that he possibly had.
00:19:48.12\00:19:49.45
So those things can create
a lot of burden and stress
00:19:49.48\00:19:52.49
on a family and
create a lot of grid lock,
00:19:52.52\00:19:55.09
as well as
confusion, as well as conflict.
00:19:55.12\00:19:57.63
Those are things that
we have to watch carefully
00:19:57.66\00:20:00.20
and look at how
we protect ourselves.
00:20:00.23\00:20:02.70
And then, of course,
00:20:02.73\00:20:04.83
unexpected medical expenses
not fully covered by insurance.
00:20:04.87\00:20:09.40
And these crop up all
the time, long-term care,
00:20:09.44\00:20:13.07
there are things
that you need to be aware
00:20:13.11\00:20:15.68
to plan and prepare.
00:20:15.71\00:20:17.31
So how do you plane
for this type of things?
00:20:17.35\00:20:22.25
Have you
assessed where you are at
00:20:22.28\00:20:23.75
right now in your life?
00:20:23.79\00:20:26.49
Where is your
finances right now?
00:20:26.52\00:20:29.59
What are you doing to
assess your current debt?
00:20:29.62\00:20:32.39
Do you have debt,
and if not, kudos to you.
00:20:32.43\00:20:35.63
I'm glad that you're
in that much control,
00:20:35.66\00:20:37.77
but do you know
how much your pay check
00:20:37.80\00:20:40.54
and revenue is
in a monthly basis?
00:20:40.57\00:20:42.74
Do you know how
much your expenses
00:20:42.77\00:20:44.91
are on a monthly basis?
00:20:44.94\00:20:46.68
Are you in a
net profit situation
00:20:46.71\00:20:48.88
so you can utilize
the savings mechanism
00:20:48.91\00:20:54.55
and to put money away
00:20:54.58\00:20:56.42
into an
emergency savings package
00:20:56.45\00:20:58.35
so that you have
those funds available
00:20:58.39\00:21:00.82
in case something comes up
00:21:00.86\00:21:03.39
that you are not
quite prepared for?
00:21:03.43\00:21:05.06
Because count on it,
00:21:05.09\00:21:08.93
unexpected items
always happen in life.
00:21:08.96\00:21:13.50
How much should you plan
00:21:13.54\00:21:15.70
to put away in an
emergency savings program?
00:21:15.74\00:21:19.71
Emergencies happen all the time.
00:21:19.74\00:21:22.88
Job loss happens all the time.
00:21:22.91\00:21:25.31
Lack of funds
happen all the time,
00:21:25.35\00:21:27.65
so what we're
dealing with right now
00:21:27.68\00:21:29.02
is having something put
away so that if you lose a job
00:21:29.05\00:21:31.25
and while you're
looking for new job,
00:21:31.29\00:21:33.02
and hopefully you can
find one relatively quickly,
00:21:33.05\00:21:35.09
you can tap into
an emergency fund
00:21:35.12\00:21:39.19
that will carry you
through this time of turmoil
00:21:39.23\00:21:43.13
or a time of challenge.
00:21:43.16\00:21:45.37
But many experts differ on
their basic expectations of
00:21:45.40\00:21:52.17
what you should
have put away in savings.
00:21:52.21\00:21:55.34
And I will not tell you
that I have the answer in full,
00:21:55.38\00:22:00.08
but what I will do is
tell you my recommendation is,
00:22:00.12\00:22:03.52
with the way things
are in the economy now
00:22:03.55\00:22:06.35
I don't think that
three to six months
00:22:06.39\00:22:08.42
is adequate enough to cover
when you go through a job loss.
00:22:08.46\00:22:13.90
What I suggest is this if
you do go through job loss,
00:22:13.93\00:22:17.63
your expectation should be
00:22:17.67\00:22:19.87
that you are
probably be without a job
00:22:19.90\00:22:22.24
for approximately a
year, maybe up to 18 months.
00:22:22.27\00:22:25.31
That's what the averages
are at this point in time.
00:22:25.34\00:22:27.88
Now as the economy gets better
00:22:27.91\00:22:29.61
and more jobs are made available
00:22:29.64\00:22:31.31
it'll be easier and easier
to get that job and quicker.
00:22:31.35\00:22:34.58
But I would suggest this,
00:22:34.62\00:22:35.98
in planning and in preparing
for that type of emergency,
00:22:36.02\00:22:39.09
I think, that
three to six months
00:22:39.12\00:22:41.22
maybe a little too
limited at this point of time
00:22:41.26\00:22:45.53
and you can use that
up relatively quickly.
00:22:45.56\00:22:47.56
Unless, of course,
00:22:47.60\00:22:49.40
you have other
talents and skills
00:22:49.43\00:22:51.37
and you expand your horizons
00:22:51.40\00:22:53.64
and tap into a variety of
different revenue streams.
00:22:53.67\00:22:56.71
If you teach piano,
if you teach mechanics,
00:22:56.74\00:23:01.91
if you fix cars,
00:23:01.94\00:23:03.41
if you do other
things on the side
00:23:03.45\00:23:05.05
that can help mitigate the
use of that emergency fund,
00:23:05.08\00:23:09.05
then you are in a better setting
00:23:09.08\00:23:10.62
and it can help you get
to where you need to go.
00:23:10.65\00:23:13.36
But that is my
recommendation here
00:23:13.39\00:23:15.59
is I would say eight
to ten months of savings
00:23:15.62\00:23:19.36
would work out a lot better
00:23:19.39\00:23:20.96
then if you had
just three to six months.
00:23:21.00\00:23:22.93
But any type of savings is good.
00:23:22.96\00:23:26.23
And I recommend that
you take a look at that.
00:23:26.27\00:23:29.20
So what they recommend
00:23:29.24\00:23:32.11
and I'll give
you what's in writing
00:23:32.14\00:23:33.88
from several different gurus
that are out there they say,
00:23:33.91\00:23:36.28
two to three months
worth of take-home salary,
00:23:36.31\00:23:39.98
two to three months
worth of take-home salary,
00:23:40.02\00:23:42.68
or six months
worth of living expenses,
00:23:42.72\00:23:46.86
living expenses.
00:23:46.89\00:23:48.22
So to live what would be
00:23:48.26\00:23:50.06
you can live half of
your savings for six months
00:23:50.09\00:23:55.76
without having to
bring in additional revenue.
00:23:55.80\00:23:58.17
And I suggest that would be
a better way of approaching it.
00:23:58.20\00:24:02.04
So six months
of living expenses.
00:24:02.07\00:24:04.17
Start small and pay off debts
00:24:04.21\00:24:06.51
before building
your three to six months
00:24:06.54\00:24:08.54
worth of living expenses.
00:24:08.58\00:24:09.91
So the first thing
you must do I think
00:24:09.94\00:24:13.35
in preparation for
any type of emergency
00:24:13.38\00:24:15.32
is getting rid of the debt
00:24:15.35\00:24:16.69
that you don't
necessarily need to have.
00:24:16.72\00:24:18.35
And what is that?
00:24:18.39\00:24:19.72
Credit card debt,
those type of debts
00:24:19.75\00:24:21.92
that you don't necessarily
need such as, you know,
00:24:21.96\00:24:25.96
any type of overhead
expense that you are not,
00:24:25.99\00:24:28.23
you'll necessarily
utilize on an ongoing basis.
00:24:28.26\00:24:31.43
So strip down all of
the expenses you have,
00:24:31.47\00:24:36.30
look at your budget and find out
00:24:36.34\00:24:38.64
what you need
versus what you want.
00:24:38.67\00:24:40.98
Take care of all of those needs,
00:24:41.01\00:24:42.74
come to a place
where you understand
00:24:42.78\00:24:44.71
where you're at
with the paycheck
00:24:44.75\00:24:46.78
and how much
revenue you coming in,
00:24:46.82\00:24:48.52
where you are with expenses
00:24:48.55\00:24:50.65
and understand how
where the money is going.
00:24:50.69\00:24:52.59
And knowing that you have
a certain amount of money,
00:24:52.62\00:24:54.59
you can put into savings
00:24:54.62\00:24:55.96
and allocate a certain
amount for an emergency program
00:24:55.99\00:24:58.26
so when something
happens you have the ability
00:24:58.29\00:25:01.63
to take care of
that specific concern.
00:25:01.66\00:25:04.53
Now there is a slide
that I like to put up
00:25:04.57\00:25:07.07
at this point in
time that talks about
00:25:07.10\00:25:09.04
the consequences of poverty,
00:25:09.07\00:25:10.67
consequences of poverty.
00:25:10.71\00:25:12.04
And this is one of the slides
or I think is very interesting
00:25:12.07\00:25:15.08
because it shares with us
00:25:15.11\00:25:16.64
that there are
consequences to not planning.
00:25:16.68\00:25:20.42
Typically what happens
when someone runs into a crisis
00:25:20.45\00:25:24.19
and a stress with finances,
00:25:24.22\00:25:26.19
as you see domestic violence
00:25:26.22\00:25:28.42
and anxiety
happens within that family,
00:25:28.46\00:25:31.36
the stress typically
takes on a different format
00:25:31.39\00:25:34.36
because then you see many
other type of stress stories
00:25:34.40\00:25:37.80
type of happen in the family.
00:25:37.83\00:25:40.24
And then of number three
00:25:40.27\00:25:41.60
is mental and physical
illness tends to happen.
00:25:41.64\00:25:44.57
Humiliation, a feeling
of failure, alcoholism,
00:25:44.61\00:25:47.74
drug addiction,
these are all things
00:25:47.78\00:25:50.75
that people deal with
00:25:50.78\00:25:55.75
when they're looking
at going into poverty.
00:25:55.78\00:25:58.35
They are fighting through
it, they can't find a job.
00:25:58.39\00:26:01.06
You find that
what happens after that
00:26:01.09\00:26:02.92
is kind of juvenile
delinquency prostitution.
00:26:02.96\00:26:06.03
Those types of things
actually happen in families
00:26:06.06\00:26:08.13
that are going
through this crisis.
00:26:08.16\00:26:10.67
Communities that are
having these financial issues
00:26:10.70\00:26:13.30
and you can see pockets of
them in underserved communities
00:26:13.34\00:26:16.14
having run-down
communities you see tagging
00:26:16.17\00:26:18.61
and that's the biggest
issue that that tends to lend
00:26:18.64\00:26:23.48
that there are other things
00:26:23.51\00:26:25.11
under the surface
starting to happen.
00:26:25.15\00:26:26.65
When kids can't find work,
when parents can't find work,
00:26:26.68\00:26:29.68
you see a lot
of other activities
00:26:29.72\00:26:31.52
happening in the community,
00:26:31.55\00:26:32.89
Poor education is another key,
00:26:32.92\00:26:35.19
and then of
course, community, violence
00:26:35.22\00:26:39.26
and unrest happens
00:26:39.29\00:26:40.63
and it can lead
to premature death
00:26:40.66\00:26:42.56
as we talked about
00:26:42.60\00:26:43.93
by people stressing
over Christmas Day issues.
00:26:43.97\00:26:47.30
And then did you
know that monetary issues
00:26:47.34\00:26:52.64
can lead to wars
and major conflict,
00:26:52.67\00:26:55.98
major conflict?
00:26:56.01\00:26:57.51
There are things that
you should be aware of.
00:26:57.55\00:27:00.58
Because when you look
at what loss of income
00:27:00.62\00:27:05.82
and lack of
preparation for emergencies
00:27:05.85\00:27:09.49
and the inability to find work
00:27:09.52\00:27:12.06
and the stress that happens
to the family environment,
00:27:12.09\00:27:15.86
you begin to understand
00:27:15.90\00:27:17.23
that this thing can be prevented
00:27:17.27\00:27:19.10
if we take a step
back and plan and think.
00:27:19.13\00:27:23.17
And I keep going back to
the basic issue of assessing
00:27:23.20\00:27:28.31
where you're at.
00:27:28.34\00:27:29.68
Write that down,
where are you now.
00:27:29.71\00:27:31.65
Then take a look at
what your budget is.
00:27:31.68\00:27:35.22
Do you have a budget?
00:27:35.25\00:27:36.58
And if you don't,
00:27:36.62\00:27:37.95
create a budget simple
look at what I bring in,
00:27:37.99\00:27:41.32
and what I spent.
00:27:41.36\00:27:43.56
And with that you
can better develop
00:27:43.59\00:27:47.70
a roadmap to success.
00:27:47.73\00:27:50.00
Because all of
this has to do with
00:27:50.03\00:27:52.40
is understanding that
you have the opportunity
00:27:52.43\00:27:56.74
to be successful
00:27:56.77\00:27:58.11
so take it to the bank and save.
00:27:58.14\00:27:59.84
I'll see you next
time. Thanks, God bless.
00:27:59.87\00:28:01.81