Basics of budgeting covered by Salvation Army and TFCU

The Salvation Army and Tongass Federal Credit Union have partnered together to host a series of financial workshops. These monthly programs are scheduled to cover the basics of finances, from building credit to handling debt. The workshops are free and open to the public, held once a month at the Salvation Army office on Zimovia Highway. The first class was held on March 12, covering the basics of setting a budget.

"This is supposed to be a learning and fun exercise, if you will," said Kemberly Green, with TFCU.

A budget, simply put, is a list of a household's monthly income and expenses. The first step of creating a budget is to determine these expenses, adding together all available sources of income and figuring out each expense a household has. A budget is a good way to organize and manage money, she said. Green also added that following a budget requires a lot of willpower sometimes, which is something people need to keep in mind when they are making their own.

Marisa Fulgham, also with TFCU, talked about some different aspects of budgeting people need to keep in mind. Fixed expenses, as the name implies, are expenses that do not change month by month. Fixed expenses can include rent or insurance payments. Flexible expenses can change on a monthly basis, such as groceries or gas money. "Income" is the amount of money coming into a household, Fulgham said, but that is not the same thing as "disposable income." Disposable income is the amount of money left over when one subtracts income taxes from their total income. Disposable income is the amount of money a household can use to cover their expenses. Another important aspect of budgeting, that Green brought up, is the importance of knowing the difference between a "need" and a "want." Groceries count as a necessity, but an expensive bag of chips would fall under the "want" category. To have a stable budget, making sure needs are covered, and sticking to it, is important.

"Discipline is a very hard word when dealing with a budget," Green said. "I think that's where we all have a way of learning our strengths and our shortfalls when it comes to a budget, with the discipline aspect."

During the workshop, Green passed out handbooks going over budgeting and how to create one. She said TFCU was ordering several, which they would have on hand to pass out at their office in the near future.

The next finance meeting at the Salvation Army will be on April 9, on debt management.