Budgeting 101 Comes to Solon Library

“These are things I’ve done myself,” said William Russo, a certified financial planner, to start off the budgeting workshop at the Solon library Thursday night. Speaking to a full house, he talked about his professional and personal experiences with budgeting.

First of all, he suggested not calling it a “budget” but a “spending plan” because of the negative connotation linked to budgets.

“There has to be a motivating factor to make a change, then you can put yourself in a position to take control,” said Russo, who is also a member of the Solon City Council. 

The current economy has put pressure on many outwardly affluent communities, including Solon. Your overall net worth does not matter, and recognizing that you have little or nothing left at the end of the month should send warning signals.

Following these six easy steps takes discipline, but will result in reaching your financial goals and reducing money related stress in your life:

1. Gather sources of income by listing all the funds coming into your spending plan.
2. Review your fixed (housing, insurance, loans) and variable (food, clothing, entertainment) expenses.
3. Trim wherever possible, by cutting avoidable expenses, reducing variable spending, and planning for lower fixed costs.
4. Align income with expenses. Make some hard decisions, and evaluate the costs of your habits and hobbies.
5. Include savings as part of your budget so that you can cover the unexpected and take advantage of new opportunities.
6.  Monitor and modify your plan as you start achieving your goals. Your plan should reflect your goals and is not cast in stone.

Throughout the workshop, Russo stressed the importance of identifying "leakages" – the seemingly small amounts of money that dribble through your fingers.

“It's not uncommon to see $500-$2,000 unaccounted for in family spending monthly,” Russo said.

He supported this claim by discussing the direct and indirect cost of smoking. Another way to save is by buying a lunchbox, he suggested. It’s easy to save $350 a year just by brown-bagging once a week.

Russo wrapped up by saying that you should never make purchases based on what other people do, and always put yourself first by including savings as part of your budget/spending plan.

Responding to a questions, Russo said that paying bills online was an acceptable risk. 

Tracy Glivar said she thought the budgeting class was a worthwhile program and laughed as she said she’d have to “take some things out of my life that I don’t need.”

Ila Mistry added: “I thought savings was something you had left over, not something you budgeted for.”