STRIVE with Dave Peterka on Financial Management and Planning
The STRIVE Presenter on February 16th was Dave Peterka, Vice President and Chief Credit Officer of Beacon Bank and an Excelsior Rotary Club Member. Dave discussed Financial Management and Planning with the students. He started out by telling the students that he has been in the lending and operations end of the banking business for 34 years and that 30 of those years have been right here in Excelsior. He and two others started the Beacon Bank 21 years ago. Dave told the students that his kids graduated from Minnetonka High School.
Dave started his presentation by suggesting that participation is important when discussing financial information and that the students could ask questions at any time during his talk. As it turned out the STRIVE students asked more questions that any group in the past. Peterka handed-out a worksheet for the students to work from that covered the main topics of Budgeting, Spending, Savings, and Debt.
“Everyone needs a budget” was Dave’s first major point. He pointed out that without a budget it is too easy to get in debt regardless of your age or income level. Dave has had a personal budget for the past 33 years and pointed out that it is important to save something every pay period. Page two of the handout contained a sample personal budget and Dave urged the students and mentors to begin budgeting. He asked how many of the students track their money with a written record or an electronic and all the students indicated that they did it electronically. Dave emphasized how important it is not to have overdrafts and the consequences thereof. (Pictured here with Dave are Matt and Travis who are interested in pursuing Business Majors in college.)
Peterka next turned to the topic of spending and the importance of tracking your spending. He indicated that there are many types of software out there such as “Quicken” and “Simply Checking” to help them track their spending and to avoid the consequences of overdraft charges. Dave discussed Credit Cards and the need for the students to protect their credit card information and to be sure to pay-off the charges each month. “Credit card debt is Bad Debt!” exclaimed Peterka. Along with this line of thinking Dave also discussed Credit Scores from good ratings of near 850 all the way down to 300. He suggested that two credit cards are better than one because it shows that you can manage multiple accounts. “Also be sure to stay current with payments to protect your credit scores and a higher credit score gets you lower rates on loans.” said Peterka.
At this point Dave was bombarded with questions about credit scores and managing money issues that the STRIVE students were concerned about. He said, “This is the perfect place to discuss ‘Good Debt vs. Bad Debt’. Good Debt is major purchases you can plan and budget for and might include a home loan, buying a car and/or taking out a student loan. If you take out a student loan use it only for tuition and take out as little as possible.”
“Bad Debt on the other hand is getting into credit card debt that isn’t paid off within 30 days.” Dave knows of people who have had over 30 credit cards and have gotten themselves into deep financial debt. So Peterka cautioned them, “Do not have more than two credit cards and payoff your balances monthly and above all else do not fall into impulse buying!”
After many more questions Dave summarized his presentation by making the following hints for good financial management and planning:
1. Start reading “Money & Business” in the Sunday Tribune (some good hints weekly)
2. Maintain close control of your own money
3. Manage your money and expenditures daily (using software)
4. Establish a budget and follow it (budget some fun)
5. Don’t use credit
6. When you get paid – save a little!
7. Protect your identity – do not share it with anyone!