Saving On Home Renovations

Is your kitchen in desperate need of a facelift? Bathrooms haven’t been remodeled sinceTwo men measuring boards Bush was in the White House? (And we’re not saying which one!)

With the warmer weather approaching, many homeowners are thinking of making minor and major household improvements. And for most, the cost will be prohibitive: The average kitchen remodel tops $60,000 and a bathroom overhaul can run $18,000.

No worries, though! With some careful planning and smart choices, you can shave thousands off the cost of renovations.

Here’s 7 terrific ways to save when remodeling.

1.) Don’t do a complete remodel

It’s tempting to want to go all out once you’re remodeling, but unless structural damage demands that a room or area be completely gutted, there’s rarely a reason to start from scratch. Instead of knocking down walls and hallways, try to envision the outdated area with a fresh coat of paint, new light fixtures and some minor décor changes.

Is your kitchen a total blast from the past? Instead of giving it an overhaul, consider replacing the drawer handles and knobs, staining the cabinets and refacing the moldings. Perfecting old cabinets can be a full 50% less expensive than putting in brand new ones.

Potential money saved: $30,000.

2.) Shop around for a contractor

Choosing a contractor is not a decision to take lightly. You’ll want to find someone honest, professional and reliable – and willing to give you a decent price.

Don’t hire anyone on the spot; check out at least three different contractors before making your decision. Ask for references and meet with each contractor in person to get a feel for their character and professional conduct. Take note of whether they show up on time and their willingness to answer questions. Doing these simple tasks will provide you with important clues about their reliability. Be sure to ask your prospective contractor if they generally stick to their schedules or tend to fall behind. In this business, time is money, and a delay in a project’s completion can cost you a pretty penny.

Finally, be sure to sign a detailed contract before making any final decisions. The contract should stipulate the final cost and estimated timeframe for the project.

Potential money saved: several thousand dollars.

3.) Consider long-term costs and benefits

You don’t want to choose the most expensive option for every remodeling decision you’re going to make, but it often makes sense to pay more now if it’ll save you big further down the line.

For example, if you’re installing clapboard siding, you’ll save in the long run by paying more for pre-primed and pre-painted boards. Using the more expensive prefinished claps means you’ll need half as many paint jobs in the future.

Money saved: $1,250 (for a 10×40 area).

4.) Pick decent but midgrade materials

Choosing the cheapest materials usually ends up costing more in the future. But that doesn’t mean go with the most lavish and expensive. in general, it’s best to go with the midgrade option whenever possible.

One significant area where you’ll see this at play is in carpeting. Basic olefin and polyester carpeting will run you $1 to $2 per square foot, while wool costs upward of $9 to $11 per square foot.

Money saved: $400 (for a 40-square-foot area).

5.) Bring in natural light without windows

Looking to add a splash of sunshine in your kitchen? Don’t cut that gigantic hole in the side of your house just yet! Adding windows is a major deal and there are other, less expensive ways of bringing sunlight into your home.

Instead, consider installing a “light tube.” This genius contraption slips between the rafters on your roof and works to funnel sunshine down and into the living space below.

Adding a double-pane window can run you $1,500, while a light tube is only $500.

Money saved: $1,000.

6.) Lend a hand

You don’t have to be super-handy to help out and save money at the same time. You can easily do some of the demolition work yourself, paint some walls or even sand the walls to prep them for painting. If you think you’re too clumsy for even these minor jobs, lend a hand with the cleanup at the end of a project. Why pay a cleanup crew $200 a day to sweep up sawdust when you can handle a broom just fine on your own?

Money saved: $200 a day or more.

7.) Increase efficiency, not size

If you feel like your kitchen is too cramped and you need to push out some walls to make it work, think again. You can easily reorganize your kitchen for maximum efficiency and save tens of thousands of dollars.

Replace large, clumsy shelves with pullout drawers that are equipped with racks for easy, aesthetic storage space. Upgrade your cabinets with lazy susans, dividers, pullout trays and more. Consider hiring a professional organizer to show you how to maximize the space you’ve got; the organizer’s fee and the money you’ll spend on the specialized cabinets will still fall way below the cost of an expansion.

Money saved: up to $60,000.

However you choose to go about your renovations, don’t forget to call, click, or stop by Destinations Credit Union today to learn about our fantastic rates on Fixed Home Equity Loans and Home Equity Lines of Credit (HELOC)!

Your Turn: Have you recently remodeled? How did you save money? Share your best hacks with us in the comments!


How To Use The Money Envelope System

If you’re like many of us, you’ve been trying to stick to a budget for a while, but by the man putting money in envelopetime each month is over, you’ve busted your budget – again.

Because of this recurring pattern, you’re probably wondering if there’s a better way. Fortunately, the answer is yes!

The money envelope system has been around for years, and it’s an incredibly motivating and powerful way to keep spending in check.

Destinations Credit Union is proud to bring you this handy guide to understanding and implementing the money envelope system in your household.

Note: If you already have a workable monthly budget, you can skip to step 2.

1. Determine your monthly income and expenses

For the next few months, track all of your expenses. Hold onto every receipt or record each purchase you make, being sure to indicate which category of expense it falls under. Hold onto every pay stub, too. When a three-month period has passed, you’ll sit down to figure out exactly how much discretionary income you’re left with each month. This will not include fixed amounts, like insurance premiums, mortgage payments, savings and investments.

2. Create a budget for every expense category

Now, divide your discretionary income into different categories. The categories you need and the amounts you’ll set aside for each will depend on your individual lifestyle and habits, but you’ll likely need categories for food, gas, entertainment, transportation and clothing costs.

Review the way you’ve been spending your money in the last few months for an idea of how much you’ll need to set aside for each category. If you see you’ve been overspending in a certain area, this is a great time to resolve to cut back.

3. Create your envelopes

This is where the money envelope system differs from a regular budget. Instead of having money set aside for each category in your head, or even scribbled on a paper somewhere, take one envelope for each expense category and mark it clearly. Now, put the exact amount of cash for this month in the envelope for each category.

Do this with every expense category, and voila! You’ve created your new budgeting system!

4. Stick to your budget

As in any budget, following through on a plan is the hardest part. With the envelope system though, it’s a whole lot easier.

Say you need to make a grocery run. You’ll peek inside your “groceries” envelope, take note of how much cash is inside, and figure out how much you can afford to spend. Take that amount of money to the store with you, and only use that cash. No cheating! There’s absolutely no card-swiping allowed and no sneaking money from another envelope to beef up a skimpy cash supply in another. You need to work with what you have.

Instead of walking out of the store with a dozen items in hand that weren’t on your list, you’ll be forced to stick to your budget. And, if you find yourself running low on grocery money one month, you’ll have to make do. You can take the pantry challenge and dream up a menu created around the ingredients you have on hand, or you can shop the sales and cook according to what’s cheapest this week.

Do whatever it takes – but no cheating!

5. Reward yourself!

If you find yourself with extra money in any category at the end of the month, it’s OK to celebrate. Dave Ramsey recommends rewarding yourself with a dinner out or an expensive drink. Alternatively, you can treat that money as “rollover cash” and use it to enjoy a roomier budget next month.

Tips and tricks

Here are some variations and different approaches to this ingenious system:

  • Use a small accordion file folder instead of individual envelopes. It’ll be easier to keep track of your envelopes when they’re all in one place, and it’s sturdier than paper envelopes.
  • Go cashless! Love the idea but hate the thought of only using cash? You can still use the envelope system with some minor adjustments. There are apps designed to create virtual envelopes for you to use, such as Mvelopes. You can also use a cost-free budgeting app that allows you to divide and track your spending into different categories, such as Mint, Quicken and Monefy.
  • Trim your fixed expenses. If you’re finding it difficult to stick to your self-created budget, try to cut back on your non-discretionary spending. Search for a cheaper auto insurance plan. Ditch your cable. Find ways to trim your electric bill and gas expenses. Use the money you save to add to the envelopes that never seem to have enough to get you through the month.
  • Create an emergency envelope. Set aside $20 or $50 to use in case another envelope runs out of money.
  • Use Destinations Credit Union “You Name It” accounts as your envelope for larger expenses, like emergency savings, gift-giving or vacations.

Congratulations! You’ve got the money envelope system down pat! Here’s hoping it helps you on your journey toward financial wellness.

Your Turn: Have you tried the money envelope system? Has it worked for you? Why, or why not?


6 Ways To Know You’re Using Your Credit Cards Responsibly

Credit cards are an important financial tool, but they need to be used responsibly. Here’s woman shopping online with credit cardhow to know you’re okay.
  1. You can easily pay more than just the minimum payment each month.
  2. You don’t rely on your credit card for everyday purchases.
  3. You are using less than 30% of your credit limit.
  4. You never take out cash advances.
  5. You use it mostly for large, necessary expenses.
  6. You read all the fine print in every letter you receive from your credit card company.
Your Turn: In what ways do you use your credit card? Share with us in the comments!

Energy Saving Tips – What To Look For When Buying New Appliances

There’s no getting away from the fact that our dependence on energy increases daily. Couple buying appliancesWith energy-dependent technology driving our lives, ecologists continue to search for ways to save our environment. Focusing on energy-efficient appliances is one way to do that.

Your monthly electric bill may not itemize the specific usage of each appliance in your home. If you are interested in a breakdown, though, you can ask your local electric company for a listing. But about 30% of the charges on your statement stem from your electrical appliances. That’s why the government, as well as the majority of appliance manufacturers, encourage consumers to replace standard devices with new energy-saving ones.

So, if your dishes aren’t coming out clean after a run in the dishwasher, or if the ring around your shirt collar has not disappeared after a hot laundry wash, you may be in the market for a new appliance.

There could be some good years left in that 10-year-old refrigerator or oven. But, generally speaking, prices for electrical appliances have come down across the board over the years. And once you consider the cost of a new part for your old apparatus, plus the charge for the visit, it just might be worthwhile to chuck the old and buy new.

It’s also worth keeping in mind that the new energy-efficient appliances save you money on a monthly basis because they use far less electricity. They also help the environment by cutting down on greenhouse gases emitted into the air.

What is Energy-Efficient?

So what does it really mean if an appliance is energy-efficient? In simple terms, it means the process used to make the appliance function – spin, clean, cool, heat, etc. is using less energy. This can be achieved in a number of ways, and manufacturers are always adapting new techniques, such as using renewable sources of energy like water or sunlight.

Now that you have decided that a modern and energy-efficient refrigerator is what you need, how can you be sure you’re choosing the best product at the most reasonable price?

Here are some tips to guide you in your search:

  1. Determine the total cost. Since the purpose of your new purchase is to save on monthly energy costs, the first thing to consider is the operating costs. That, along with the actual purchase price, should give you the real cost of the appliance.
  2. Look for the energy rating. There are several reliable rating services that provide information about appliance energy consumption. The federal government uses the yellow and black Energy Star Standard sticker to inform consumers about operating costs and annual energy consumption. This helps buyers compare one clothes dryer to another. Energy Star tests each item independently.
  3. Select the right size appliance. Running a large machine – even the most energy-efficient one – uses more electricity than a compact one, so don’t buy something bigger than what you need.
  4. Look for economy choices. Many dishwashers and washing machines offer a variety of different cycles. If you find one with an economy cycle, that will save you money when you need to wash only a small load of clothes or dishes.
  5. Stay Simple. When it comes to choosing a refrigerator, go easy on the add-ons. According to one independent rating service, a water dispenser or ice maker uses a lot of extra electricity. Also, top-to-bottom fridge/freezer models are more energy-efficient than side by sides. The auto-defrost feature uses heat to speed up defrosting and makes running the refrigerator less efficient.

This holds true for self-cleaning ovens as well, so consider the value in this upgrade.

  1. Contact your utility supplier for the latest ways to save on utility charges. With today’s smart devices, appliances can be programed to use less energy at certain times of the day.
  2. Check out your home. If you have the time and the extra cash, it may be worthwhile to call in a home assessor to help identify ways you can save on your overall energy and water costs. He or she may be able to tell you how to use your appliances at the most energy-efficient times of day.
  3. Comparison shop. Never buy the first model you see. Household appliances are not cheap, and to find the most energy efficient one at the best price, shop around. Well-known name brands are always more expensive than lesser-known companies. However, they don’t always offer a better product. If you check carefully, you may find that heating element in the name-brand laundry dryer is exactly the same as the one in a model selling for hundreds of dollars less. Compare the details. You might be surprised.

Your Turn: Do you own an energy-efficient appliance? How much has this purchase trimmed from your monthly electricity bill?


Saving as a Family

By Sarah M. Ellis, UF/IFAS Extension Citrus CountyFamily sitting in front of house

When you have a family, it seems like there is never enough money to go around and saving money frequently gets pushed aside. However, saving money can help stabilize your family’s financial life.

Saving is putting money aside for future use and requires discipline and, at times, denial. Therefore, it’s important to discuss the importance of saving with the whole family. Generally, people save with a goal in mind. Do you have an emergency fund? Do you need a new car? Would you like to take a family vacation?

If you do not have an emergency fund, establishing one should be your first goal. Life happens and you never know when a family member or pet might get sick or have an accident. Having money set aside in case of an emergency helps you avoid building debt if a crisis occurs.

How much money should be in your emergency fund depends on your family size, income, spending habits, and job security. It is recommended, if possible, to have three months of income in your emergency fund. Saving three months of income might seem impossible, but how much you save is less important than how often you save. Small, but consistent, savings add up over a period of time.

Once you have your emergency fund established you can start saving for other needs or wants!

For saving tips visit America Saves’ 54 Ways to Save Money.

Saving as a Family

By Elizabeth Kiss, Ph.D.; Associate Professor and Extension Specialist, Kansas State University/Kansas Saves

Sometimes when children hear their parents or other adults in their lives talking about cutting spending or saving money, they assume that the family is going through a rough patch. As appropriate based on children’s ages, family conversations about money goals, including saving and spending plans, reassure children. It is also a great way to introduce (or remind) children about the reasons we save.

Talking about family saving goals helps children understand that putting money aside for the future – whether to be prepared for unexpected expenses, for short-term goals such as summer vacation, or for longer term goals such as paying for college – is important to you. They will also likely be interested in knowing how they can help. They may even want to set their own savings goals and be motivated to work toward achieving them!

Get Your Family Involved

Get your family involved with your saving plan by brainstorming ways to cut expenses in order to free up money to put toward your saving goals. Explore low- and no-cost activities you can do together as a family. Consider selling rarely used books, toys, clothes and other items in a garage sale or other marketplace.

Involve children by:

  • Encouraging them to be aware of their energy and water use by turning off lights and electronics when not needed and by turning off the water when brushing teeth and taking showers
  • Thinking about things that the family regularly spends money on and talking about if the family stills wants or needs the items or if they can select cheaper alternative or perhaps do without them
  • Teaching them to comparison shop and choose generics or use coupons when it makes sense
  • Challenging them to suggest ways to enjoy time together as a family for less. Not sure where to start? Check out these suggestions

Including children in trips to your financial institution (or an ATM) to deposit or transfer money into a saving account helps them to visualize the process. Consider posting a running total of the dollar amount of deposits and the progress made toward a family saving goal on the refrigerator or a bulletin board.

Encouraging Children to Save

Saving money is a habit that is developed over time. In addition to letting children know that you save, help them begin to develop their own saving habit. Money as You Grow, a framework that links money-related activities to children’s developmental stages, is a great resource for conversation starters and activities for children of all ages at

Make Your Tax Refund Work for You!

By Justin Chu, Program Associate, Taxpayer Opportunity Network

Piggy bank on tax form

Filling income tax form with pen, calculator and piggy bank

Every year, the middle of April marks the end of the federal tax return filing season. For many Americans, that can mean seemingly endless forms, paystubs, and other paperwork. However, tax time can also be a unique opportunity for saving for your future! You can maximize tax time in three easy ways and have your tax refund work for you.

1. Put your refund into a saving account
For people claiming some of the unique tax credits that benefit hardworking families around the country such as the Earned Income Tax Credit and the Child Tax Credit, their tax refund may be the largest sum of money they will see the entire year. By opening a savings account, you can deposit a portion or all of your refund and let the amount grow over time. Luckily, you can do this using the IRS Form 8888, which will divide your refund over multiple accounts.

2. Put your refund into a savings bond
As a part of the Form 8888, you are now able to easily and seamlessly purchase Series 1 US Savings Bonds as you prepare your tax return! These 30-year bonds are backed by the United States government and they will pay you interest yearly. Bonds are a great, low-risk option to grow your savings while receiving a little bit of money each year.

3. Get your taxes prepared for free
If you make less than $53,000 a year, you can your taxes prepared at no-cost by IRS-certified volunteers in your local community! The Volunteer Income Tax Assistance (VITA) program has served millions of Americans for more than 45 years. If you qualify, you can find your local VITA program using this tool; at these VITA sites, you can find expert information to help demystify the tax code and to prepare your taxes.

These three steps are only a small sample of how you can leverage this annual process! Tax time can be confusing but you can maximize your tax return to build for a more sustainable future. Don’t delay and be sure to start your own saving story today!

Do you and your money care about the same things?

By Heather Marshall, CFPC, MPP; Educator, AAA Fair Credit Foundation/Utah SavesPiggy bank in front of blackboard

As the old adage goes “Actions speak louder than words.” On the topic in question, it is fair to say spending is an action that implies values. Which explains why the nature of finances can be so personal, and challenge us to ask the question, what do we value?

Is it:

  • Family?
  • Friends?
  • Health?
  • Happiness?
  • Travel?
  • Spontaneity?

In asking these questions, spending becomes a means of self-examination shedding light on our actions and our values. Sometimes they don’t add up and when they don’t add up life can get off track. Such as if you value health, and yet find on your bank statement a lot of transactions related to unhealthy fast food. Thus, prompting the questions:

Does your money care about the same things you do?
Is your budget going towards things you really care about?

In which case steps can and should be taken to realign spending with what we value. Such as:

  • Review expenditures and categorize them to see where the money is going. Know where you are now so you can make a plan going forward.
  • Recognize there may be some items in your budget that need adjusting, but will take time to achieve. For example, moving closer to work to cut down on travel and provide more family time will require time and planning.
  • Set goals to getting your money on track.
  • Make your goals visible. When you have the impulse to spend on something you really don’t value, you can stop yourself because you have visual reminders around you. Create visuals with pictures of your goals on the wall, on our computer, on your phone. Keep it readily in front of you.

Remember, money can enable a lifestyle of values and goals that reflect us. Now that you are aware of these tendencies and about what you value in life…go make your money care about what you care about.

Saving for Education is Simplified in 2018

By Invite EducationChild with graduation cap and gown

The recent tax bill expands 529 savings plans to include expenses for elementary and secondary education. And, the annual gift tax exclusion has increased. This is big news for education savers – no matter how much you are saving!

Congress wanted to make it easier to save for education. Traditionally, 529 plans have been used to cover college costs only, making 529 savings plans the go-to option to save for college for many families.

The new tax bill allows 529 plan distributions of up to $10,000 annually to pay for private school tuition all the way through the senior year of high school. This would include religious and parochial institutions.

“This expansion of the 529 plan is a net positive for families saving for higher education as it opens flexible options for tax-advantaged savings towards high school tuition as well.” said Peter Mazareas, a member and former chairman of the College Savings Foundation.

The other benefits of 529 plans remain unchanged. Earnings are accumulated tax-free each year, and distributions from the accounts for qualified educational expenses are also made free of tax. These tax-free savings and distributions help build a larger education savings nest egg and help reduce the amount borrowed for college.

States and national program managers offer 529 plans, often sold directly by the states (direct-sold plans) or through financial advisers (adviser-sold plans)

In addition to the federal tax benefits, you should also consider these factors:

State tax advantages: Many states offer deductions for qualified contributions. However, take a closer look at any restrictions. Some states require residents to use an in-state plan to qualify for deductions.

Fees and performance of investment options: As with any investment plan, it is important to pay attention to the fees and to the risk/return given the time frame for saving. Many plans offer age-based investment options to reduce the risk of principal loss as students get closer to college age.

More information on the program in your state can be found at

Some education savers may also take advantage of the increase in the annual gift tax exclusion. Taxpayers can now make tax-free gifts up to $15,000 ($30,000 for joint filers). If you have the means, consider taking advantage of a unique 529 plan benefit: you can lump-sum, super-fund a 529 plan with five years of gifting. Up to $75,000 can be bundled without gift taxes and put into a 529 plan, making it easy to transfer to relatives and help pay for future expenses. Once making the maximum bundled gift of $75,000, the contributor would have to wait five years before making additional gift contributions without penalty.

These changes are intended to encourage saving for education. But, the most important step remains the same: begin saving today. Consistently saving – even small amounts – over long periods of time allows a basic concept of finance, compounding, to work in your favor. Compound interest is the additional amount earned on previous interest. For example, if you have $100 in the bank and earn 3 percent interest, after 1 year you will have $103 if the interest compounds annually (aka simple interest). If it compounds every day, you will have $103.05. At the end of the second year, you will have $106.09 with annual compounding and $106.18 with daily compounding. The point is to illustrate that earning interest on interest grows savings as quickly as possible.

Another related basic rule of finance is that savings will double when the number of year times the interest rate approximately equals 70. For instance, in 10 years at a 7 percent interest, a $100 investment would be valued at $201.36, compounded daily. Taking advantage of compound interest can help grow education savings and reduce future college debt.

Finally saving for education is getting easier as crowd-funding opportunities are used. Many 529 plans have programs to permit relatives and friends to contribute to a student’s 529 education savings account. Also, be on the look-out for national programs such as Gift of College, which can now be found at retail outlets such as Toys R Us and Babies R Us. Friends and relatives can purchase these gift cards online or in stores to contribute to a student’s college savings.

All of these programs are designed to make saving for education easier with the hope of reducing future student debt. Remember: Saving a dollar today is better than borrowing one tomorrow.

Is It Always Best to Pay Off Credit Cards Before Saving for Retirement?

By Janet Alvarez

image of credit card

Close-up of a credit card

Conventional wisdom says you should pay off your credit cards before saving for retirement. While it’s generally true you should pay off high-interest credit card debt as quickly as possible, there are a few situations where retirement savings should come first. Let’s look at the benefits of each approach.

Benefits of Paying Off Credit Cards First

Credit cards usually mean high-interest debt, and the longer you take to clear it, the more you’ll pay in interest. Here are some key reasons why you should pay off credit cards first:

  • High-interest credit card debt can be hard to make a dent in. If you’re not making more than the minimum payment on your credit card, compounding interest means your balance will barely budge. Even if you never use the card again, you will end up making payments for a long time.
  • If you’ve got credit card debt, your finances might be strained. High credit card debt is usually an indicator that you’re living above your means. You should get your spending and budget under control before investing in retirement.
  • High-interest debt rates are usually higher than market returns. If your credit cards carry a 25 percent interest rate, but a retirement fund is likely to only earn about 8 percent per year in the market, that’s a whopping difference of 17 percent that you’d be missing out on by saving for retirement instead of paying down credit cards.

Benefits of Saving for Retirement While Paying Off Cards

Still, saving for retirement is critical, and there are several reasons why you might wish to do so even if it takes you longer to pay down high-interest cards. Among these are:

  • 401(k)s and other retirement vehicles carry tax benefits. You can contribute to 401(k)s and certain other retirement plans using pre-tax dollars, thereby reducing your adjusted gross income and overall tax burden. This frees up extra cash for other purposes, such as credit card debt repayment.
  • The earlier you start saving for retirement, the better. Delaying retirement savings means missing out on months or years of compound interest. The longer you wait, the more likely you’ll end up pinching pennies in your 50s as you try to catch up on retirement savings. Compounding interest allows even people who never make big salaries to end up with comfortable nest eggs—but only if they start saving early.
  • Saving for retirement builds good financial habits. Socking money away for retirement is not only essential to your financial future, but it also helps you develop better money habits today. In doing so, you’ll learn how to budget better and address the sources of your debt. Plus, retirement accounts are usually difficult to raid (they often carry fees and penalties for early withdrawal). These extra hurdles discourage you from accessing this cash until you actually need it for retirement.

Special Situations May Help You Decide

Deciding whether to pay off credit cards or save for retirement first is a complex, personal issue. However, there are some special circumstances that suggest a clear direction:

  • Your employer offers a 401(k) match. A retirement savings match is free money. Even if you have high-interest credit cards, save at least the minimum required to get your full employer match, or you’re leaving money on the table.
  • Your credit cards have low interest rates. If you’re able to carry or transfer your credit card debt on low or zero percent APR cards, then it makes sense to save for retirement while paying these off, since your low interest rates mean debt won’t snowball quickly—assuming you’re not making new purchases that add to existing debt. (See: When to Do a Balance Transfer to Pay Off Credit Card Debt).
  • You’re age 50 or older. If you’re 50 or older, savings are critical because you’re that much closer to retirement, and have less time to save or allow money to compound. Plus, savers 50 or older are allowed extra catch-up contributions to their retirement plans.
  • You’re buying a house or applying for credit. If you’re applying for a mortgage or other forms of credit in the foreseeable future, you’ll want your credit card balances low, and your credit score as high as possible.

Paying off credit card debt and saving for retirement are both important financial goals. Often, they can even be achieved simultaneously. Regardless of which one you pick, commit today to setting aside extra cash each month to achieve your financial goal.

Janet Alvarez is the news anchor for WHYY/NPR and the Executive Editor of Wise Bread, an award-winning consumer education publication focused on helping consumers make smarter credit choices.